Why did GM Brazil choose TNT as its logistics partner

Streamlining Logistics at General Motors Corp

Why did GM Brazil choose TNT as its logistics partner

This caselet discusses the technology initiatives by General Motors Corp. (GM) in Brazil. These initiatives are targeted at improving the logistics system, to make the production of economy range cars in Brazil more efficient. The caselet also discusses the outsourcing contract of GM, which was expected to bring in benefits in its logistics worldwide.

Issues:

» Importance of logistics in production schedules

» Impact of logistics management on costs

Introduction

General Motors Corp. (GM), the world’s largest automaker, came into existence in 1908. By mid-2005, GM had manufacturing bases in about 32 countries, sold its vehicles in about 200 countries, and employed around 324,000 people around the world. GM’s brands included Buick, Cadillac, Chevrolet, GMC, Holden, Hummer, Opel, and Pontiac.                              

GM set records in industry sales in the US for the fourth consecutive year in 2004 for total trucks, pick-up trucks, and sports utility vehicles…

Questions for Discussion:

  1. Why did GM Brazil choose TNT as its logistics partner? How did TNT help GM in achieving its objectives of following the Just in Time concept? Explain by bringing out the advantages of logistics systems to GM. 

  2. Apart from generating a super efficient logistics system to help develop the OTD concept and increase Internet sales, what are the other benefits that GM could have obtained by forming a joint venture with CNF Inc.? Why did it avoid the traditional contracting arrangement with the logistics firm?

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