Honda Malaysia has announced that they will be utilizing rail-based transportation system for delivery of parts between Thailand and Malaysia; becoming the first Honda company in the world to switch to rail-based delivery. Previously, Honda Thailand shipped parts manufactured in Thailand to Honda’s assembly plant in Alor Gajah, Malaysia via trucks.
The leverage between Honda Malaysia and Honda Thailand is aiming for is better and more efficient logistics delivery of Honda parts. Honda Malaysia has also committed to continue providing excellent customer satisfaction by delivering parts in good condition, shortening the waiting period and back orders, reducing cost of production and passing the reduction in cost to Honda customers in the future.
Besides cost reduction benefits, this initiative is in parallel with Honda’s environmental friendly credentials; claiming that the switch of modes of transportation from trucks to trains will to result in a reduction of 60% of CO2 emissions. Honda Malaysia has also discovered that the switch to railways will also lead to lower logistic risks, less wastage and minimize damages. Real time tracking is possible as local railway services provider, Keretapi Tanah Melayu (KTM), uses a GPS tracking system that allows Honda Malaysia to estimate time of arrival of the goods.
All these will lead to a cost reduction of logistics by 50% in two years. With that, Malaysians can expect a possible price reduction of Honda cars and spare parts in the coming years, while Honda remained in-line with its ambition to become the epitome of environmentally friendly car manufacturer.