Tata Motors Limited is the world’s 17th-largest motor vehicle manufacturing company, fourth-largest truck manufacturer, and second-largest bus manufacturer. The company’s Commercial Vehicles Spares business has partnered with Vector Consulting Group since June 2014 in order to build an agile supply chain that can deliver excellent service to their customers. A good after sales service with excellent availability of genuine parts is crucial for vehicle sales. Ensuring spares availability for commercial vehicles is a major challenge due to the enormous variety of spares (potentially more than 1,20,000 parts) across a portfolio of trucks ranging from sub-tonne to 49-tonne mass movers, and passenger transporters that range from 5-seater mini vans to 81-seater buses. Since it is necessary to maintain this large variety of parts over the long life span of vehicles (7 plus years) , Tata Motors, like most players in this segment, was operating with very high inventory and long lead times.
By implementing the ‘pull’ replenishment model of TOC (as opposed to conventional forecast based model) on 893 vendors and 200 dealers for 26,367 parts that accounts for 95% of the sale, the Spares business has transformed its operations. The following benefits were achieved: