LOGISTICS

Logistics happens to be an integral part of the supply chain and with an organization as huge as Toyota
they need their segments to be as efficient and effective as possible. They want their operations to work
at a pace suitable for their extremely rigid delivery requirements. The Toyota Production System makes
sure the logistics operation for their products is same across all the globe. The logistics in Toyota plays to
significant roles.

INBOUND
LOGISTICS Deals with the transportation of vehicle
parts and other raw materials from (tier)
1 suppliers to the OEM plants.

OUTBOUND
LOGISTICS Deals with the distribution of the finished
vehicles from assemply parts to showrooms
and dealers.
 INBOUND LOGISTICS
Inbound Logistics at Toyota deal with the segments that come before the manufacturing stage. The
suppliers which are responsible for supplying parts and equipment directly to an Original Equipment
Manufacturer (OEM). The best way to describe logistics at Toyota is by calling the whole chain a logistic
network.

Local Inbound Logistics

The suppliers are organized in clusters according to their respective locations. The trucks are required to
pick up multiple parts from different suppliers along the way. This is also known as ‘milk route’. These
trucks are unloaded at the terminal known as a cross dock. The unloading of these trucks are only done
when necessary. The production flow and the unloading of these trucks go hand in hand so that what is
delivered to the plant is at the right time and right quantity. Toyota has established partnerships with
several third party logistic providers.
 NETWORK LOGISTICS
(S1, S2, S3) (S4, S5, S6)
CLUSTER 1 CLUSTER 2

T1 T2

C1X C2

T3 T4

T5
P1

P2

T6
 ROUTE PLANNING
Route planning is done once a month with respective to the upcoming production plan. It is an essential
part of logistics, a detailed plan regarding producting plan is needed for routue planning or else a route
plan without an advance production plan would not only be inefficient but would also be disorganized.

Combing hundreds of suppliers, checking their proximity to cross docks and running the entire operation
in time is a heavy task but Toyota does it all too easily. The planner makes sure he knows the loactions
and decides to go with the plan with the most less travel time along with the lowest costs possible. The
planner also keeps track of the amount of space required for each shipment so that the trucks and
orders could be alligned in a similar way. Partial loads would not make any sense and would also be a
hurdle to the entire logistics chain therefore the planner has to be extremely efficient about the entire
planning process.

The road routes, the distances and the potential problems that could be witnessed by the drivers on the
way to and from the plants and regional cross docks are also kept in mind and considered before
finalizing the route plan.
 PIPELINE MANAGEMENT

Toyota operates a very lean supply chain, making sure the management is aware of the different
segments of the pipeline, more specifically parts pipeline. This basicalliy means all the parts have been
picked up by the trucks from the suppliers and yet to be unloaded.

The truck enters the plant and the parts status is updated to show that the parts are in the plant yard.
The trucks are not uploaded until they’re updated about the status of the production. When the parts
are unloaded,the arrival of the trucks is displayed after scanning. Pipeline data helps Toyota to have an
indepth insight about the parts pipeline. This pipeline database is significant to prevemnt situations like
parts shortage, short shipment, or transportation delay. It is thus clear that visibility plays a key role in
the management of the inbound parts logistics process.
 OVERSEAS INBOUND LOGISTICS

Parts from Japan are shipped From the rail car it is

through a vessel to a port from transported to the
where it’s then transported by assembly plant rail yard.
railway.

From the rail yard the

container is emptied into a
truck which then takes the
shipment to the assembly
dock.

The overseas parts are transported at a higher risk because the long lead time which is usually around
six weeks or more can lead to excessive junk, defaulted parts. A part shortage could be detrimental to
the entire logistics process.
 OUTBOUND LOGISTICS
Outbound logistics, also known as the distribution process because it covers all the processes after the
product is done with its manufacturing stage. The finished vehicles are transported from the OEM plants
to the consumers, more likely known as retailers. The outbound logistic chain is a little bit different for
different regions and country. Toyota depends greatly on trucking companies and other sources of
transportation for the distribution process because its relationship with 3PL only goes so far.

after the
processing in the shipment can be
fined vehicles are marshalling yard done in two ways;
transported into a the vehicles are through trucks
marshalling yard moved further to and through
the staging area railcars
for shipment
 MARSHALLING YARD OPERATIONS

The marshaling yard operation is exceptionally vital because it makes sure the deliveries are made on
time. Marshaling yard flow displays the flow operation performed in the marshalling yard. After the
production of vehicles in the plant, they are moved further to other areas. Vehicles that need the
installation of accessories go to accessory staging which can take up to a few days. Marshaling yard flow
directly to either of the two options be it through the rail or truck staging areas.

BY ROAD SHIPMENT
The trucking companies are responsible for loading and unloading the containers are perform their due
deliveries on time. The trucking partner is provided with a weekly forecast of the required vehicles by
the dealer. This helps the trucking companies in arranging the right amount of drivers and trucks for the
deliveries. There still could be unforeseeable circumstances which might delay the deliveries but the
entire process depends on the efficiency of the trucking partners.
 RAILWAY SHIPMENT

Railcar Prestaging
shipping stage empty railcars

Assigning
loading the
destinations to
vehicles
railcars

unloading the
shipment from
railcars