Driving reliable coverage and lower costs for a leading automaker
This Fortune 500 automobile manufacturer struggled to source reliable capacity on low-density lanes, leading to costly over-tendering in the spot market.
By enrolling their low-volume lanes in Guaranteed Primary, this automaker locked in 100% tender acceptance—up from 65%—while securing cost savings in the form of lower rates. And with Guaranteed Primary’s monthly transparency reports, the automaker has identified ways to drive operational efficiencies.
Accelerating the search for capacity
Reliability can make or break a business. When you’re a Fortune 500 automobile manufacturer, all freight is business-critical to meet production demands. That’s why a world-leading automaker chose Convoy as their single-source shipping solution and enrolled their most challenging lanes in Convoy’s Guaranteed Primary program.
Demand outstripped supply in the automotive industry from 2020 onward. This automaker, along with others in the automotive industry, struggled with issues across their supply chains, from chip shortages and labor shortages to rising fuel and service costs.
Adapting to these market shifts and streamlining operations was essential for business growth. This included securing reliable capacity across low-density lanes. The automaker required a minimum 97% tender acceptance rate across lanes, but observed carriers accepting nearly all high volume lanes and canceling shipments for low volume lanes with fewer than 48 annual moves. These challenges led the automaker to over-tendering in the spot market, which amplified costs.
Guaranteed Primary hops in the driver’s seat
By enrolling in Convoy’s Guaranteed Primary program, this automaker locked in coverage across their low-volume and surge volume lanes. To date, more than 3,200 shipments have been completed across 348 unique lanes. Tender acceptance increased from 65% to 100%.
Each shipment was priced based on dynamic rates in-tune with the market. Convoy delivered fair value for guaranteed capacity, ensuring coverage when needed and cost savings when possible given market conditions.
Transparency reports also helped the automobile manufacture identify more ways to streamline operations and optimize costs. Detailed breakdowns of Convoy’s competitive rates and estimated shipper savings offered insights on additional savings opportunities in comparison to other offerings in the market.
At the end of the day, we know what we pay. We know other providers are more expensive and might not be the most effective partner. This transparency helps me find a better way [to source capacity].”
VP of Transportation Operations at Fortune 500 automaker
Counting on expanded coverage
Today, this automobile manufacturer continues to find ways to streamline their operations, drive efficiencies, and enhance quality by exploring ways to expand Guaranteed Primary coverage to low- and high-volume lanes.
Key to operational strategy is insight drawn from Guaranteed Primary transparency reports. The automaker is using report data to find ways to improve multi-stop operations, shorten lead times, and shrink appointment windows.
Operations leaders and Convoy are also partnering to adapt to evolving market conditions. As market softening occurs, Convoy is passing on cost savings directly to the automaker in the form of lower rates—all the while continuing to deliver consistent and high-quality capacity.