Lucid looks for a flawless launch with Glovis
Electric vehicle start-up Lucid Motors is preparing to launch its first luxury sedan, the Lucid Air, from a new plant in Casa Grande, Arizona. The carmaker is working closely with logistics provider Glovis America on how to execute volume deliveries when the car comes to market next year, writes Marcus Williams
As a start-up carmaker Lucid Motors has been working to a tight planning schedule, which is why it needed the expertise of a seasoned logistics player such as Glovis America to help with the development of an outbound distribution network.
“We have a very short launch window and that requires us to partner with talent and bring that into the company,” said Greg Henninger, director of global logistics at the carmaker, who was speaking at this year’s Automotive Logistics Supply Chain Live conference. “I couldn’t possibly have hired the talent necessary to launch a logistics and supply chain network in the timeframe in which we are going to launch the vehicle.”
Glovis America has experience in developing outbound logistics networks from beginning to end having established one in North America for Hyundai and Kia, as the logistics company is part of the Hyundai Motor Group. At the same time, Lucid being a brand-new company means Glovis has a clean slate to work with.
“In comparison to our existing partners who are legacy and come in with their ideas and plans, Lucid is younger and more innovative,” says Charles Franklin, senior national manager of sales at Glovis America. “There are people on both sides of Lucid and Glovis who can provide input and create a brand-new programme, trying to avoid some of the mistakes or legacy constraints that we have all experienced.”
The companies started collaborating early to work on the outbound strategy and Lucid’s engineering team worked with Glovis on the most cost-effective way to ship the vehicle. That included bringing a Lucid Air model to one of Glovis’s facilities so that staff could see how the vehicle would work in an actual environment. Getting the engineering team involved also helped familiarise them with the realities of shipping an electric vehicle, something that helped influence modifications to the vehicle to make it more efficient to ship across the different modes of transport, according to Henninger. Since then the scope of vehicle logistics services that Glovis provides to Lucid have expanded further.
“When we first engaged Glovis is was specifically to do the transport, conveyancing and delivery to the customer,” said Henninger. “That has evolved as things do. Now Glovis has stepped in to help us design our yard and the building we have in it.”
The yard is built on the greenfield site of the plant in Arizona and Glovis brought its knowledge of previous developments to the table.
“It was really working hand-in-hand with Lucid to see how it would fit timing, scheduling and the flow, even down to the number of jobs per hour,” explained Victor Arabe, senior manager of business development at Glovis America.
Lucid Motor’s logistics department will hand over the vehicles to Glovis at the yard. Both parties will do a quality check and put the vehicles to charge and from there Glovis takes control of the outbound shipment to the forward destination centre and PDI location. After that Lucid takes back control and its sales and marketing department handles final delivery to the customer.
Choice of equipment
Building volumes into any established distribution network is a challenge when dealing with a start-up company but, according to Arabe, Glovis’s strong relationships with its carriers means it has been able to do this successfully.
“When we first developed the network design with Lucid we had to consider which of our carrier partners would be best suited for this task,” he said. “They need the right technical equipment. The advantage of doing the testing with Lucid in advance helped us identify which type of tractor-trailers would be used for this, including closed and open ones.”
There are also special considerations for the transport of EVs given the weight of the lithium-ion battery and the specific dimensions of the car. In Lucid’s case is the length of the vehicle is around 5 metres. This reduces the number of vehicles per transporter given the legal loading regulations for vehicle transporters in the US. Currently a typical 80-ft (24.4-metre) transporter is limited to a weight of 80,000 lbs (36.3 tonnes).
“The weight restrictions are still the same so with that you can get five to six vehicles on [an open] tractor-trailer nowadays, said Arabe, with fewer still on an enclosed trailer. “It does impact the position and the number of vehicles on the trailer.”
Rail is also an option for the movement of the Lucid Air but not on the trilevel rail wagons that would usually be for sedans and smaller vehicles in North America. There are also slight restrictions on the use of bilevels related to the chocks used to secure the vehicles in place.
“Let’s just say 80% of the chocks work but there are a few chock designs that are too high for you to be able to lock the vehicle down,” said Franklin. “With that you have to monitor what chocks are coming in on the railcar because if the railcar comes in with the wrong ones you will not be able to use it.”
Added to this is the state of charge of the vehicle being transported, which is a big priority for Lucid. Taking the distribution network into account the carmaker has established the level of charge for the Lucid Air before each vehicle is handed over to Glovis.
Henninger said the regulations governing EV distribution have improved over the last decade, which has helped.
Tracking the vehicles from when they have left the facility in Arizona through the distribution chain is another priority for Lucid and Glovis. Finished vehicle logistics lags other sectors in the provision of up-to-the-minute visibility but according to Henninger, anything less in today’s environment is a failure.
“It was not only an expectation but a requirement during our sourcing process that we have real-time visibility,” he said. “The technology exists, we just need to ensure we are applying the technology that is available.”
Glovis is aiming to provide this through the modification of a real-time tracking system it already uses for aftersales parts visibility.
“We are modifying that system to apply to finished vehicles,” said Franklin. “We do parts deliveries to dealers over 24 hours because dealers are asking for the part to fix the car. Basically, we are modifying systems that we already have in place.”
Getting the right equipment in place to transport the vehicles safely and with the greatest efficiency, and knowing exactly where they are in the system, is going to help Lucid achieve the flawless launch Henninger said is the number one priority. Working with Glovis the carmaker is focused on improving processes and systems over the next two years. That reducing cost, increasing efficiency and securing adequate capacity to support outbound operations.
“I can’t accept anything less than a flawless launch,” he said. “At the end of the day that is what we all are doing."
One of the things that makes the distribution network somewhat novel is that Lucid’s assembly plant is in Arizona, a state not previously known as an automotive hub but one that is attracting the attention rival EV makers as well.
“There are other alternative fuel [vehicle] manufacturers if not in Arizona then in that general region, so this could be new normal for production for the alternative fuel vehicle,” said Franklin.
According to Henninger there are a number of advantages to making a car in Arizona.
“If you take it out of context, Arizona doesn’t seem to be an automotive hub but it is business friendly environment,” he said. “It has a great workforce as we have found out over the last six months and the transport network is good, including road, rail and air. There is also an added benefit: the free trade zone treatment in Arizona is unique in the nation I think.”
Arizona is also relatively close to the southern Californian ports and within the scope of road haulage. That has helped Glovis develop its own network by creating an origin-destination link.
“It gives an additional opportunity for the network to have a destination to return from,” explained Arabe. “Vehicles delivering from our facility in port Hueneme to Arizona now have a way to get back. It has developed the network for us and probably for others.”
Volvo Cars is also in the launch phase of its new fully electric XC40 Recharge, which has driven greater complexity into the inbound supply chain. In the previous article, Volvo's Magnus Ödling talks with supporting logistics providers talk about managing new flows, new volumes and new part numbers
When we first engaged Glovis is was specifically to do the transport, conveyancing and delivery to the customer. That has evolved as things do. Now Glovis has stepped in to help us design our yard
Greg Henninger, Lucid Motors
When we first developed the network design with Lucid we had to consider which of our carrier partners would be best suited for this task,” he said. “They need the right technical equipment”
Victor Arabe, Glovis America
It was not only an expectation but a requirement during our sourcing process that we have real-time visibility. The technology exists, we just need to ensure we are applying the technology that is available
Greg Henninger, Lucid Motors
We do parts deliveries to dealers over 24 hours because dealers are asking for the part to fix the car. Basically, we are modifying the systems that we already have in place [for finished vehicles]
Charles Franklin, Glovis America