Categories: B2B Payments

B2B Transportation Biz Cranks Up Tech, Logistics To Meet New Normal

Whether it’s moving cars across town or hauling them across the country, COVID has changed the way commercial shippers, carriers and car dealers handle millions of vehicles each year, while opening new markets that didn’t exist before.

For example, wholesale auto sellers who used to deal mostly in person have pivoted — and largely stayed — with their new digital model, in turn bringing a surge of business to transportation providers like Manheim Logistics.

“As more dealers turned to these [digital] platforms, they started shipping from farther away,” Joe Kichler, vice president of Manheim Logistics, told PYMNTS.  “So we saw an uptick in the number of new clients needing help with longer moves,” he added.

And not just longer moves, Kichler said, since the pandemic had “everyone doing things differently,” which meant relearning everything from how to access facilities, to understanding changes for pickup and deliveries, to handling increased calls for status updates.

Bottom line, though: all of it highlighted the need for more technology solutions to keep things moving smoothly.

“No one knows what the ‘new normal’ will be, but we believe people will continue to buy more cars digitally — on both the wholesale and retail sides,” Kichler said.

In addition, he added, as more dealers offer digital retailing, “there’s also going to be a growing need for local delivery to a consumer, as well as picking up the trade-ins and taking them back to the dealership.”

It’s all part of why Manheim just formed a new collaboration with DHL, as it looks to prepare for that eventual upheaval in the $5 billion B2B auto transportation space.

“We want clients to let us manage their entire supply chain and create a great experience while they focus on their core businesses of selling cars,” Kichler said. “We recognize that the biggest opportunity in this space revolves around how technology can enable advanced load building and routing, versus manually dispatching one or two cars at a time.”

By combining advanced technologies and the logistical expertise of DHL, Manheim seeks to go beyond what clients have received in the past, by offering more detailed data reporting and mobile access for remote workers.

The Repo Ripple

Another less positive trend that bodes watching is repossessions, which Kichler said he is “keeping a very close eye on.”

“We haven’t seen as many repos as we historically have at this time of year because of the government and banks providing longer grace periods,” he said. “However, we are starting to see that faucet turned back a little,” he added.

Although the rate of repos has not yet returned to “normal,” when it does, he said it will come with its own administrative challenges for shippers and carriers.

And while a carrier supply shortage experienced in the early part of the pandemic has largely rebalanced itself, prices are still inflated from pre-COVID levels.

Going forward, Kichler said the new car business looks to be the biggest business opportunity for Manheim right now, and its upgraded emphasis on delivering better logistics through improved technology.

“As you move cars around, you can bundle new and used car loads and create greater load and price efficiencies,” he said.

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NEW PYMNTS STUDY: ACCELERATING THE REAL-TIME PAYMENTS DEMAND CURVE – NOVEMBER 2020

About: Accelerating The Real-Time Payments Demand Curve:What Banks Need To Know About What Consumers Want And Need, PYMNTS  examines consumers’ understanding of real-time payments and the methods they use for different types of payments. The report explores consumers’ interest in real-time payments and their willingness to switch to financial institutions that offer such capabilities.