The global supply chain in motion is having the requirement of comprehensive preparations as well as making of decisions at various stages that are having a direct major influence on a the organizational performance of Jaguar Land Rover. In 1989, Ford did the purchasing of the company. In 1994, BMW bought Land Rover and the latter joined Jaguar under Ford in 2000 that created a new well-known brand called Jaguar Land Rover. In 2008, the company was taken over by Tata for £1.1 billion. Jaguar Land Rover is spending roughly £4.5 billion having more than 2,200 suppliers in 2010, most of it in respect of production suppliers that are providing the materials, elements as well as equipments that are required for making the vehicles for Jaguar Land Rover. The company is purchasing products as well as services from other suppliers for supporting the company’s operations that includes the aspect of transporting the parts as well as products, marketing as well as IT.
Manufacturing
The company’s manufacturing base is primarily in the UK and is presently split across six sites comprising of three vehicle manufacturing plants, two advanced design as well as centres for engineering and one centre for the manufacturing of engine. The £500 million engine centre started its operation in 2014, and is designed for manufacturing a range of 4-cylinder petrol as well as diesel engines. There occurred the commencement of full production from 2015 with a targeted capacity of 400,000 engines every year.
From 2008/2009, the volumes of Jaguar Land Rover have mostly doubled and 2 of its 3 plants in the UK have switched to a three-shift pattern for meeting the growing demand. Moreover, the organization is growing and is continuously trying to look at the expansion of its manufacturing operations in different parts of the globe.
Jaguar Land Rover is having as well as development centres in Dubai, Minnesota (US) as well as at the Nurburgring (Germany). Moreover, in 2012, through the aspect of joint venture, Jaguar Land Rover did the extension of its operation to China. The company made an agreement for commencing a partnership with a domestic Chinese company, Cherry Automobile Company, and did the establishment of Cherry Jaguar Land Rover (Mangan 2016).
In this context, it can also be stated that there is the necessity for procuring pertinent raw materials as well as spare parts at the appropriate time for the effective functioning of Jaguar Land Rover. In an equal manner, it is necessary to do the delivery of the finished products in respect of the company’s dealers as well as distributors. The company is acknowledging that the company’s supply chain is having a major contribution on the company’s sustainability performance and as a result, the long-term growth of the company. The company did the initiation of various programmes for enhancing environmental as well as social awareness within the company’s supply chain. The final aim of the company is ensuring that the supply chain of Jaguar Land Rover is having an equal consideration of the company’s sustainability vision as well as strategic aspects.
Suppliers
There is occurring the development of the car industry as an extended as well as complex network of varied level tier suppliers. First-tier suppliers are delivering to OEMs, either individual parts or large incorporated methods that are accumulated from parts whose delivery s done by second-tier suppliers. There occurs the collection of parts by Jaguar Land Rover only from the first-tier suppliers majorly due to the schedules of demand that are delivered only to the first-tier suppliers. First-tier suppliers should, as a result do the placement of separate schedules of demand on the second-tier suppliers.
Jaguar Land Rover is having a base of roughly 900 suppliers that are situated in continental Europe, the UK as well as the rest of the globe. The company is seeking suppliers that are delivering quality as well as reliability while being understanding of the overall costs of logistics. The other major factors that needs to be taken into consideration are location, time and cost of transport, weights, sizes, duties as well as securities relating to supply. Jaguar Land Rover is holding a close association with its suppliers. Consequently, Jaguar Land Rover is ensuring the organization will get value for money, particularly when there is the involvement of international freight. Also, there occurs the demonstration of the fact that Jaguar Land Rover will be recognizing that its service providers are not only having the required proficiencies in the field. But a very effective understanding as well of the market due to the collaboration with other OEMs, which is resulting in an improved summary of the various routes of transport, ports as well as rates of operation that are having the availability. The supplier’s use of comprehensive information will be providing different scopes (Mangan 2016).
Demand and Sales
From 2010 to 2015, Jaguar Land Rover did the witnessing of exceptional success. In 2014, there occurred the establishment of the new sales records for Jaguar Land Rover in 38 markets, while in total the organization did exporting to more than 170 countries. Changes regarding demand occurred not just regarding total absolute volumes but also regarding the geographical aspect.
Logistic Service Providers
The Logistic Service Providers or LSPs are playing a major role in the manufacturing of Jaguar Land Rover. They are having an involvement in different activities all through the supply chain that ranges from collecting the parts as well as in-plant material flow management to the aspect of distributing the finished vehicles. The USP of the company is making a major contribution as well regarding the international growth of the Jaguar Land Rover, majorly in the designing as well as implementing strategies regarding logistics outsourcing. Jaguar Land Rover is contracting the LSPs with an increased experience level as well as proficiencies in particular areas, which is allowing the maintenance of high levels of customer levels.
Jaguar Land Rover did the establishment of a more strategic association with a particular LSP named called DHL, which is playing a major role in the overall logistics operations regarding Jaguar Land Rover. The company’s accountabilities regarding the supply chain will be encompassing a much more wider opportunity in comparison to the other LSPs of Jaguar Land Rover. This kind of LSP is termed as a ‘lead logistics provider’. DHL is accountable towards the coordination of the overall inbound network of Jaguar Land Rover, which includes transport management, stock handling as well as line feeding in the 3 UK plants. DHL is accountable for almost 85% of international inbound freight, which includes all of Europe as well as the UK (Mangan 2016).
Packaging
Efficient packaging is of major significance in respect of the car industry not just because it is safeguarding the raw materials as well as finished vehicles but also due to the fact that it influences the cost as well as logistic operations. The automobile industry is using traditionally returnable packaging majorly in respect of cost related benefit, quality as well as operational effectiveness. The international expansion of Jaguar Land Rover will be leading to the growing utilization of expendable packaging. For supporting this process, Jaguar Land Rover did the establishment of a close association with DS Smith, a leading British based global business related to packaging. By involving this experienced provider of packaging solution, Jaguar Land Rover did the successful actualization of an increased rate of deliveries relating to undamaged portions (Manners-Bell 2014).
Jaguar Land Rover is spending roughly £4.5 billion having more than 2,200 suppliers in 2010, most of it in respect of production suppliers that are providing the materials, elements as well as equipments that are required for making the vehicles for Jaguar Land Rover. The company is purchasing products as well as services from other suppliers for supporting the company’s operations that includes the aspect of transporting the parts as well as products, marketing as well as IT.
The company is depending on their suppliers for providing the goods and services, required for running the business of Jaguar Land Rover. To work with them will assist the company in reducing the impacts of sustainability from the life-cycle of the company’s vehicles, as well as making sure they are operating in a responsible manner for reducing the collective risk regarding the reputation of the company. Almost 34% of the company’s production supplier sites are within UK and another 52% are in other countries of Europe. The company is recognising that these markets might not possess all the time similar stage of regulatory standards regarding sustainability in comparison to the markets that are more established and the company is possessing devoted teams for procurement in China as well as India for developing the capabilities of suppliers in these areas (Manners-Bell 2014).
Supplier Requirements
The company is having strong systems for the management of social as well as environmental threats across the company’s base of suppliers. The requirements regarding sustainability is forming an integral portion of the Global Terms and Conditions regarding Jaguar Land Rover in respect of all suppliers along with the aspect of accompanying guides relating to environmental as well as social aspects. These are having the requirement of basic legal as well as regulatory compliance and adopting the company’s Code of Basic Working Conditions that is covering child labour, human rights, health and safety as well as fair pay.
Figure 1 Location of production supplier sites
Source: (landroverhk, 2017)
Moreover, production suppliers are required actualizing 3rd party accreditation relating to environmental management standard ISO 14001. Manufacturing suppliers are also required complying with the company’s extensive list of prohibited as well as limited substances, reporting concerned substances that are logged in the company’s database of materials for assisting the company in understanding in what ways these are being utilised in the company’s products as well as assessing the probable substitutes. In addition, following the company’s guidelines for using renewable or recycled items, reusable packaging as well as recyclability (Manners-Bell 2014).
In 2010, the company created a new set of Supplier Environmental Requirements that will be bringing together all the available needs as well as emphasizing the company’s objective towards reducing the impacts all through the company’s product lifecycle.
Assessing compliance
New suppliers should require completing an individual evaluation against the company’s Jaguar Land Rover Quality aka JLRQ standard that takes into consideration the criteria regarding sustainability. The company is conducting a site evaluation for checking the information that is provided is correct prior to the qualification of a supplier as a Jaguar Land Rover supplier. In this context, the company’s engineers are visiting the sites for the production suppliers in a regular manner for assessing the compliance with quality as well as requirements relating to sustainability. They are focusing specifically on sites in which there has been the identification of the factors. The company is providing advice as well as training in respect of suppliers for supporting them to actualize or maintain the JLRQ standard when necessary (Mangan 2016)
Reducing environmental influences from the company’s supply chain
The company is working with suppliers for assisting them in operating in a more sustainable manner to focus on those with the highest influences, which are majorly suppliers of production as well as logistics.
In 2010, the company commenced a 4-year plan for reducing carbon emission from the phase of supply chain in respect of the product lifecycle of the company. The company has asked their suppliers for nominating a dedicated champion of the environment as well as for collecting data relating to carbon emissions. For supporting the company’s local base of suppliers within the UK, the company did the piloting of a carbon reduction evaluation approach with seven suppliers, functioning with Advantage West Midlands as well as the Manufacturing Advisory Service (Mangan 2016).
In 2009, the company conducted a pilot lifecycle evaluation for comparing the various carbon footprints regarding the part of a vehicle (body structure castings that is being used regarding the Jaguar XK) when offered with the help of the available supplier as well as a probable new supplier. The basic logic to consider a change regarding supplier was to do the exploration of methods for reducing costs, but the Life Cycle Assessment did the confirmation of the company’s decision through the demonstration of major emissions savings (Manners-Bell 2014). Jaguar is using the using the well-known GaBi model for conducting the Life Cycle Assessment relating to various processes of manufacturing as well as options of sourcing. One of the major differences amongst the suppliers was a new process of heat treatment that is used to manufacture the body structure castings. The use of energy as well as related emissions from this method is considerable less.
Conclusion
Jaguar Land Rover’s record sales in combination with the expansion of plants as well as development in global markets did the creation of various challenging aspects throughout the supply chain, from sourcing of suppliers as well as management of inbound flow of materials to the distribution of vehicles as well as reverse logistics in respect of returnable packaging. Last but not the least, a huge scale of supply chain operations are occurring in the automotive industry. The company is conducting a site evaluation for checking the information that is provided is correct prior to the qualification of a supplier as a Jaguar Land Rover supplier. In this context, the company’s engineers are visiting the sites for the production suppliers in a regular manner for assessing the compliance with quality as well as requirements relating to sustainability.
Reference
Mangan, J., Lalwani, C. and Lalwani, C.L., 2016. Global logistics and supply chain management. John Wiley & Sons.
Manners-Bell, J., 2014. Supply chain risk: Understanding emerging threats to global supply chains. Kogan Page Publishers.
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