Every industry encounters its watershed moments during the passage of time and the same invariably provide the companies in the domain excellent opportunities to move over to a higher growth orbit. Automotive industry and its allied segments have faced several such since the beginning of liberalization in early 1990s, notably some in the recent past; and poised to encounter many more in the not too distant future – thanks to the technology disruptions, regulations and growing awareness to environmental protection and sustainability realities. Logistics segment closely linked to the automotive industry has also undergone paradigm shifts at these inflection points. Also with more of it in the offing, the players are bracing themselves to the imminent changes in business models, to address the emerging opportunities. Asset-light and non-asset based approaches are bound to become the order of the day and knowledge driven, skilled and technical service providers likely to rule the roost. When such business models are backed up by global expertise and experience, the service providers in that class will be naturally sought after by various companies desirous of expanding their operations in the domestic and overseas markets. Wallenius Wilhelmsen Group, the behemoth in the Logistics segment, following the above business route right from inception is naturally in demand for its technical services. We met Capt. Naresh Kundlas, Managing Director Wallenius Wilhelmsen in India, a Master Mariner with 23 years of rich experience in the field of shipping and logistics to understand their approach and plans to expand the operations.
Pedigree factor
Wallenius Wilhelmsen has a more than 150-year history and is a market leader in its operational segments – in RoRo (Roll-on, Roll-off) ocean transportation and vehicle logistics, which includes transporting cars, trucks, rolling equipment and breakbulk cargo around the world. The group consists of Wallenius Wilhelmsen Solutions to take care of land-based logistics and terminals, Wallenius Wilhelmsen Ocean to focus on ocean transportation, American Roll-On Roll-off Carrier (ARC) the American RoRo flagship company and Eukor, the Eukor car carriers firm.
Capt. Naresh Kundlas says: “Wallenius Wilhelmsen started its operations in India in 2009 with South-based car OEM as the first customer. The assignment was concerning yard management, quality inspections, long term storage maintenance, load building, allocation of trailers, monitoring the trailers movement till it reached the destination, viz., the complete chain activities from yard to delivery. The next customer followed soon was from High and Heavy sector where we offered services involving dismantling the factory manufactured high-end 60 ton plus oversized material handlers like dumpers and loaders. It involved dismantling of tyres, chassis, canopies, etc., from the unit to suit road transport; and assemble them back at the port to make it RoRo like the original equipment, fit for ocean transport.”
The Indian operations of the company are on the non-asset based business model and WW Solutions India does not own any assets in either of its trucking or land-based business. Their focus is on providing specialized technical services for land and ocean-based business segments. They lease the land for their operations or work at customers’ premises / factories in extending their services. The Indian team has around 500 employees, which includes all employees located at customers’ sites as well as WW Solutions’ office in Chennai.
“Following the maturing of automotive market and the success of the firms like Maruti and Hyundai, many international auto firms entered the Indian market around 2010. They needed an agency to support them in global practices of quality, supply chain and varied facets of logistics services to meet the domestic and export requirements; and WWL India fitted the bill backed by its global expertise and experience. Wallenius Wilhelmsen’s group operations across the globe maintain same quality standards and the same being delivered in India too. Our emphasis has been to bring in the WW’s ‘WoW’ (way of working) to the Indian OEMs. It’s easy for international companies here in India with whom we are associated worldwide to understand our services and KPIs and this has enabled us to expand our customer profile in India,” indicates Capt. Naresh Kundlas.
Operations and challenges
Wallenius Wilhelmsen secured the service assignments from a wide range of customers in Automotive, Commercial vehicles, Agriculture and Construction equipment for Pre-delivery inspections, Yard Developments, Transportation and Supply Chain Solutions. Capt. Naresh Kundlas points out, “The chassis or Fully built vehicle produced in various plants of our commercial vehicle customers meant for export are sent our facility inside the port. Our responsibility includes receiving the vehicles, inspecting and repairing damages occurred during transit, performing quality checks and loading units onto vessels. For Manufacturing of commercial vehicles and Engines, WW Solutions supports the quality inspections in the production lines beside Customer’s own quality and inspections, viz., our assignment is akin to third party inspections. We bring in our specialized service to complement OEM’s quality endeavors, though the OEM is responsible for all quality related guarantees for the supplied product. Depending upon the needs, we have that flexibility to add or reduce skilled technicians and engineers to complete the assignment and this is one significant advantage for the customer from cost implications. We have recently leased out a four-acre facility in Telangana, where we receive the vehicles from OEM from their Pithampur plant. We have a full-fledged team at the facility responsible for receiving, inspections, storage, maintenance and handing it over to local person / dealer as per OEM instructions. Apart from land based services cited above, we have an ocean team attending to freight forwarding activities. Our vessels to various destinations depart from Singapore port and we book the cargo in third party vessels to reach our Singapore base for onward shipment.”
Wallenius Wilhelmsen handles High & Heavy cargoes from ports of Chennai for exports to various countries. WW Ocean’s vessels include Pure-Car-and-Truck Carriers (PCTC) and RoRo vessels. The RoRo vessels can carry the cargo equivalent of up to 7,000 cars and with a ramp capacity of 450 tonnes, it can support a full metro railcar or generators at ease on its ramps. Apart from cars, trucks, varied material handlers and RoRo equipment, they also carry big gensets and other breakbulk cargo, states Capt. Naresh Kundlas.
Commenting on the operational challenges Capt. Naresh Kundlas opines: “Lackadaisical implementation of rules and regulations are a few of the overall impediments. Take for example the road transport of tractors on trailers. The tractors have to be loaded forward-facing to comply with width regulations. However, we have seen tractors being loaded across trailers to accommodate more cargo on the trailer and save transport costs. We cannot do that being a professional organization and taking full responsibility for the delivery up to customer locations. This also puts us in a difficult spot, but with the implementation trailer code and the permissible length fixed as max 18.75 mtr, it gives a level playing field to all transporters. Lately, the service margins have come under severe pressure due to increasing competition in the space. Over a period of time, many local service providers have entered the scene with fair operations deliveries has started squeezing on the price front. As a multinational organization, WW Solutions strives to provide quality-based services and remain competitive by offering specialized services that enable us to retain and grow our business together with customers.
Road ahead
GST (Goods & Services Tax) and E-way bill will lead to reduced transit times, though not significantly in the beginning, remarks Capt. Naresh Kundlas. He adds: “Even if the seven-day transit time between Chennai and Delhi is cut down by a single day, it will lead to significant cost savings. Also with the GST and porous state border realities, OEMs are planning to reduce the number of storage depots and will look at service providers who can undertake the cost optimization exercise as a project, which we see as an opportunity for WW Solutions India. More interestingly with the recent thrust by the Govt. for electric vehicles and electric mobility, we see big opportunities shaping up for us. Logistics will play a key role in the EV arena as we are looking at the entire life cycle support for the mobility related needs. We are already extending our specialized services to OEMs who manufacture electric vehicles and we are upbeat about this segment taking off in India.” WW Solutions India, with its well-entrenched operational network, is gearing up to move into the fast lane and with Capt. Naresh Kundlas at the helm, confident of a smooth sail; and with strong tailwind in the segment. WW Solutions India is certainly a company to be watched during the exciting times ahead.