Intermodal Operations. Peter Marshall Director - Supply Chain Operations Europe, Middle East Africa Dusseldorf November 18, 2014
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1 Intermodal Operations Peter Marshall Director - Supply Chain Operations Europe, Middle East Africa Dusseldorf November 18, 2014
2 Dow Fast Facts Founded by Herbert H. Dow Headquarters in Midland, MI Fortune 100 Company ~53,000 Employees Worldwide More Than 6,000 Products 201 Sites in 36 Countries Customers in ~180 Countries Sales of US$57 Billion in 2013
3 Dow s Key Markets Developing innovative solutions aligned with attractive end markets Automotive Food Packaging Adhesives Electronics Water Agricultural Construction Coatings Infrastructure
4 2013 Sales by Geographic Region (dollars in millions) North America Sales: $20,849 Europe, Middle East & Africa Sales: $18,244 Asia Pacific Sales: $10,193 Latin America Sales: $7,794 Emerging 28% 2012 Target Developed
5 Supply Chain Strategy & Intermodal Operations
6 Priorities and Objectives for Supply Chain at Dow Working Capital Pre-requisites EHS Performance Trade Compliance Business Success Geographic Expansion New product Introduction Service Key Enablers Talent Development Supply Chain Technology Cost
7 Strategic Objectives for Modal Operations Objective Intent Meet Client requirements and targets for safety, quality & service Fulfill operational requirements, OTD, safety & quality, including Differentiated Service Requirements Create high level of client satisfaction and strong relationships Deliver World Class Sourcing options to Business needs Value Proposition Create and maintain a sustainable competitive position Leverage volumes and product sourcing Deliver market competitive value propositions to our business clients Create sustainable truck availability to meet Business growth objectives. Ensure sufficient capacity to transport all goods regardless of trucking market conditions and demand variations Achieve supply assurance and continuity without sacrificing competitive rates
8 However, Intermodal Operations has a role to play We recognize the potential; Reduce road traffic congestion Improve environmental performance Mitigate truck driver shortage
9 Current use of Intermodal in Europe DOW Bulk Products DOW Packed Products 26% Total volume transported by road 12% Total volume transported by road 74% Total volume transported by intermodal modes 88% Total volume transported by intermodal modes Dow already makes significant use of Intermodal 80% of Intermodal via Road, 20% Short Sea
10 DOW Shipments from Benelux 53 (86%) 41 (90%) 43 (58%) 122 (77%) 54 (12%) 36 (45%) 183 (89%) 48 (93%) Volume: 1,000MT
11 2014 CEFIC Report: Intermodal Transport Network Development
12 2014 CEFIC Report: Intermodal Transport Network Development
13 2014 CEFIC Report: Intermodal Transport Network Development
14 Developing Intermodal Transport Networks The perspective of a shipper
15 What does a shipper need? 1. EHS performance 2. Cost effective alternative 3. Regular and reliable service 4. Supply Chain resilience 5. New routes connecting underserved regions
16 What does a shipper need? 1. EHS performance in principle moving from road to alternative mode is inherently safer (lower accident frequency rates) additional activities at intermodal terminals need to be managed End-to-end emergency response must be assured
17 What does a shipper need? 1. EHS performance 2. Cost effective alternative European Chemical Industry is challenged;» Competition from feedstock advantaged regions» High energy costs» Lack of growth,» High regulatory standards Higher payloads are beneficial but often create inflexibility carriers need to ensure that the intermodal provider market is offering sustainable & cost competitive solutions.
18 What does a shipper need? 1. EHS performance 2. Cost effective alternative 3. Regular and reliable service: Frequency of service On-time delivery performance relative to road, End-to-end service management including proactive communication of delays or real-time information
19 What does a shipper need? 1. EHS performance 2. Cost effective alternative 3. Regular and reliable service 4. Supply Chain resilience Agile response to disruptive events such as adverse weather, strikes etc (e.g. Alpine tunnel closures in 2012, current German Rail strike) Need for back-up solutions to go with alternative modes (road or different rail/sea route) and proactively offer these to the shippers
20 What does a shipper need? 1. EHS performance 2. Cost effective alternative 3. Regular and reliable service 4. Supply Chain resilience 5. New routes connecting underserved regions: consider connectivity with major ports include door-to-door service offering
21 What does a shipper need? 1. EHS performance 2. Cost effective alternative 3. Regular and reliable service 4. Supply Chain resilience 5. New routes connecting underserved regions
22 Conclusions Intermodal is an established alternative in Europe with the potential for further growth, There are some obstacles to overcome but opportunities for service providers who master the challenge Chemical industry shippers are willing to collaborate in the development of intermodal
23 Thanks for your attention!
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