Volvo Ab Class A · OMXSTO:VOLV_A
Volvo Ab Class A — Investor Day (December 2013)
16 slides from Volvo Ab Class A's investor day presentation, Dec 4, 2013
Slide 1: Optimizing the Volvo Group manufacturing cost
CAPITAL MARKETS DAY Optimizing the Volvo Group manufacturing cost Mikael Bratt - EVP Volvo Group Trucks Operations 1 VOLVO
Slide 2: Demanding double production peak during 2013 - challenging, costly and successful
Demanding double production peak during 2013 - challenging, costly and successful • New product program for Volvo Trucks, Renault Trucks and UD Trucks industrialized 2012-2013 – old program produced in parallel • Euro VI HD and MD engines industrialized 2013 – Work load peak old program produced in
Slide 3: New products will improve industrial productivity
New products will improve industrial productivity Improved products – More modularized – Design for assembly Improved industrial process – Fishbone layout – Line upgrades – Internal logistics Result – More efficient assembly – Higher first time through – Better ergonomics Volvo Group Headquart
Slide 4: We are on time and on track in optimizing our manufacturing cost
We are on time and on track in optimizing our manufacturing cost 2012 Q1-Q2 Analysis of total potential Q3 Launch of manufacturing optimizing project (Part of Strategic Objective 1.2) 2013 Q1-Q2 Detailed planning Q3-Q4 Decision-making and first implementation 2014-2015 Implementation - Major install
Slide 5: Volvo Group Trucks Operations sites around the world – potential for consolidation
130 Volvo Group Trucks Operations sites around the world – potential for consolidation Cab & Vehicle Assembly Powertrain Production including Reman Logistic Services – warehouses for inbound, outbound, aftermarket distribution Volvo Group Headquarters 5 Mikael Bratt, EVP Group Trucks Operations, Cap
Slide 6: Towards a multi brand industrial footprint to support Group brand positioning
Towards a multi brand industrial footprint to support Group brand positioning Current brand related footprint Future multi brand footprint + European/US centered….………...………………………………….……………………………....Global coverage + + Lack of or redundant capacity…………....…………………………….……………………….... Balanced capacity +
Slide 7: Targeting reduction of fixed cost
Our vehicle for cost reduction Targeting reduction of fixed cost Variable cost 60% Fixed cost 40% Manufacturing 70% Logistics 30% Volvo Production System Top 50 list Volvo Group Headquarters 7 Mikael Bratt, EVP Group Trucks Operations, Capital Market Day, Göteborg 7 4 December 2013
Slide 8: Fixed cost reduction in the industrial structure - some examples
Fixed cost reduction in the industrial structure - some examples Asia Europe • Stepwise optimization of truck industrial footprint in Asia • Stepwise optimization of • New plants for value products truck industrial footprint in Europe • Right-sizing of manufacturing in Japan • Optimization of engine
Slide 9: Stepwise optimization of truck industrial footprint in Asia
Stepwise optimization of truck Japan Master Plan industrial footprint in Asia Consolidation into main site Ageo Truck plant from 50,000 to 13,500 capacity (+/-20%) Engine assembly plant to 13,500 capacity (+/-20%) MD engine plant Stepwise to 100,000 capacity Japan China Truck plant Stepwise to 16,00
Slide 10: Stepwise optimization of truck industrial footprint in Europe
Stepwise optimization of truck industrial footprint in Europe From 6 to 5 assembly lines in Umeå – high volume HD cab manufacturing plant 4 heavy-duty truck plants Kaluga – new market – close one line in Tuve HD truck plant Move cab trim from Umeå to Tuve Tuve – medium volume HD truck plant Co
Slide 11: Stepwise optimization of warehouse footprint in North America
Stepwise optimization of warehouse footprint in North America One new central warehouse for fast- and medium-moving parts in Tri state area of Tennessee/Mississippi/Arkansas One central warehouse for slow-moving parts in Columbus Dallas, Memphis and Atlanta to be closed Baltimore, Chicago an
Slide 12: Targeting reduction of variable cost
Our vehicle for cost reduction Targeting reduction of variable cost Variable cost 60% Fixed cost 40% Manufacturing 70% Logistics 30% Volvo Production System Top 50 list Volvo Group Headquarters 12Mikael Bratt, EVP Group Trucks Operations, Capital Market Day, Göteborg 12 4 December 2013
Slide 13: Significant improvement potential by lifting productivity of low-performing plants
Significant improvement potential by lifting productivity and performance of low-performing plants VPS Audit score G A P Sites Bring the best together to be the Challenge every site Focus on best practice sharing guiding stars and implementation Volvo Group Headquarters 13Mikael Bratt, EVP Group Tru
Slide 14: Key areas for successful continuous improvement by Volvo Production System
Key areas for successful continuous improvement by Volvo Production System Volvo Group Headquarters 14Mikael Bratt, EVP Group Trucks Operations, Capital Market Day, Göteborg 14 4 December 2013
Slide 15: Key areas addressed to optimize our manufacturing performance
Key areas addressed to optimize our manufacturing performance Quality – First time through – Warranty Lead Time – Factory delivery precision – Inventory Cost efficiency – Variable cost per unit – Fixed cost Volvo Group Headquarters 15Mikael Bratt, EVP Group Trucks Operations, Capital Market Da
Slide 16: Summary: We have traction
Summary • We have traction – One target – Comprehensive program – Activities well underway – Full attention and commitment Volvo Group Headquarters 16Mikael Bratt, EVP Group Trucks Operations, Capital Market Day, Göteborg 16 4 December 2013