Renault Group’s Logistics Transformation with Exotec Skypod System

In 2024, Renault Group undertook a major transformation of its spare parts logistics operations by implementing Exotec’s innovative Skypod robotic system at its Villeroy warehouse in France. This case study examines the drivers behind this initiative, the implementation process, key outcomes, and lessons learned. The adoption of Exotec’s automation technology has enabled Renault to significantly improve operational efficiency, customer service levels, and sustainability in its aftermarket parts business.

Company Background

Renault Group is a major global automotive manufacturer headquartered in France. In 2023, the company sold 2.2 million vehicles across 130 countries. Renault’s Parts and Accessories Logistics Division (DLPA) is responsible for the critical function of supplying spare parts and accessories to the company’s global network of dealerships and service centres. Prior to this transformation, DLPA managed 290,000 part numbers across 25 warehouses worldwide.

Renault Group’s Logistics: A Comprehensive Overview

Logistics plays a crucial role in Renault Group’s operations, encompassing both inbound supply chain management for manufacturing and outbound distribution of finished vehicles and spare parts. The company’s logistics network is vast and complex, spanning multiple continents and involving numerous stakeholders. This intricate system is the backbone of Renault’s ability to efficiently produce vehicles and deliver them to customers worldwide, while also ensuring a steady supply of spare parts for after-sales service.

Global Supply Chain Structure

Renault’s global supply chain is organised into several key divisions, each with its own specific focus and challenges. The Inbound Logistics division manages the flow of parts and components from suppliers to manufacturing plants, ensuring that production lines are supplied with the necessary materials at the right time. Outbound Logistics oversees the distribution of finished vehicles to dealerships and customers, coordinating a complex network of transportation modes and storage facilities. The After-Sales Logistics division, managed by the Parts and Accessories Logistics Division (DLPA), handles the distribution of spare parts and accessories to Renault’s global network of service centres and dealerships. Additionally, the Reverse Logistics division manages returns and recycling of parts and vehicles, playing a crucial role in Renault’s sustainability efforts.

These divisions operate under the umbrella of Renault’s Supply Chain Department, which coordinates activities across the group’s global operations. This centralised approach allows for greater efficiency and consistency in logistics practices across different regions and markets.

Inbound Logistics

Renault’s inbound logistics operations focus on ensuring a steady and efficient flow of components to its manufacturing facilities. This involves coordinating with thousands of suppliers globally, a task that requires sophisticated planning and communication systems. The company has implemented Just-In-Time (JIT) and Just-In-Sequence (JIS) delivery methods, adhering to lean manufacturing principles to reduce inventory costs and improve efficiency. These approaches minimise the need for large parts inventories at production sites, reducing carrying costs and the risk of obsolescence.

To optimise transportation, Renault employs milk-run systems, carefully planning routes to collect parts from multiple suppliers in a single trip. This not only reduces transportation costs but also minimises the environmental impact of logistics operations. The company also utilises cross-docking facilities, where shipments from various suppliers are consolidated before being sent to manufacturing plants. This intermediate step helps to streamline the flow of materials and reduce overall transportation requirements.

Outbound Logistics

The distribution of finished vehicles involves a complex network of transportation modes and storage facilities. Renault operates several strategically located Vehicle Distribution Centers, which serve as hubs for storing and preparing vehicles for final delivery. These centres play a crucial role in managing inventory levels and ensuring that the right models are available in the right markets at the right time.

Renault employs a multimodal transportation approach, utilising a combination of road, rail, and sea transport to optimise delivery times and costs. This flexibility allows the company to adapt to varying market conditions and geographical challenges. For the final leg of the journey, Renault coordinates with local carriers for last-mile delivery to dealerships, ensuring that vehicles arrive in perfect condition.

In response to growing consumer demand for personalisation, Renault has also implemented vehicle customisation capabilities at some of its distribution centres. This allows for late-stage personalisation options, enhancing customer satisfaction while minimising the complexity of managing numerous variants during the production process.

Reverse Logistics and Sustainability

Renault has been a pioneer in implementing circular economy principles in its logistics operations. The company has established robust systems for collecting, refurbishing, and redistributing used parts, effectively creating a secondary market for remanufactured components. This not only reduces waste but also provides customers with more affordable repair options.

End-of-life vehicle recycling is another key focus area for Renault’s reverse logistics operations. The company manages the collection and recycling of vehicles at the end of their lifecycle, recovering valuable materials and minimising environmental impact. This commitment to sustainability extends to packaging as well, with Renault implementing reusable packaging solutions throughout its supply chain to reduce waste.

Digital Transformation in Logistics

Renault Group has been investing heavily in digitising its logistics operations, recognising the potential for technology to drive significant improvements in efficiency and visibility. The implementation of control towers provides centralised platforms for visibility and decision-making, allowing for real-time tracking and management of logistics operations across the globe.

The company is also leveraging the Internet of Things (IoT) to enable real-time tracking of parts and vehicles throughout the supply chain. This enhanced visibility allows for more precise planning and rapid response to any disruptions or delays.

Artificial Intelligence and Machine Learning are being applied to enhance demand forecasting and route optimisation, leading to more efficient inventory management and transportation planning. Additionally, Renault is exploring the use of blockchain technology to improve supply chain transparency and traceability, which is particularly important in an industry with complex, global supply networks.

These digital initiatives are part of Renault’s broader Supply Chain 4.0 program, which aims to accelerate the digital transformation of the company’s entire supply chain. This comprehensive approach to digitalisation is positioning Renault at the forefront of logistics innovation in the automotive industry.

Challenges and Drivers for Change

Renault faced several key challenges in its aftermarket parts logistics operations that drove the need for transformation:

1. Fragmented distribution network: Parts warehouses were specialised by part family rather than geography, leading to inefficiencies.
2. Lack of a central distribution hub for France: Limited ability to meet demand in Renault’s home market, which accounts for 37% of DLPA’s business.
3. Outdated systems and equipment: Aging infrastructure was undermining customer service quality.
4. Rising customer expectations: Increasing pressure for faster order fulfilment and delivery times.
5. Need for improved sustainability: Desire to reduce energy consumption and environmental impact.
6. Labour challenges: Difficulties in recruiting and retaining warehouse workers for manual tasks.

To address these issues, Renault initiated the OTAGO project to revamp its warehouse master plan in France. This involved:

• Closing the Cergy warehouse and opening a new site in Puiseux for European/international markets
• Transforming the Villeroy warehouse into the primary distribution centre for France
• Specialising the Flins-sur-Seine warehouse for heavy/bulky parts

The Villeroy site, as Renault’s largest global warehouse at 152,000 m2, was chosen as the focal point for introducing advanced automation to drive operational improvements.

Solution: Exotec Skypod System

After evaluating various options, Renault partnered with French robotics company Exotec to implement their Skypod automated storage and retrieval system at the Villeroy warehouse. Key elements of the solution include:

• 191 Exotec Skypod robots for automated parts handling
• 14 picking stations
• 65,000 recycled plastic storage bins
• Integration with specialised packaging machines (carton forming, closing, labelling, etc.)
• Custom software integration with Renault’s warehouse management system

The Skypod robots are able to autonomously navigate the warehouse, climb storage racks up to 10 metres high, and transport bins of parts to and from the picking stations. This “goods-to-person” approach eliminates the need for operators to manually retrieve parts from shelves.

Implementation Process

The implementation of the Exotec system at Villeroy, dubbed the ReVA (Renault Villeroy Automatisation) project, involved several phases:

1. Planning and design (Q3-Q4 2023)
2. Installation and integration (Q4 2023 – Q1 2024)
3. Testing and staff training (Q1 2024)
4. Ramp-up and optimisation (Q1-Q2 2024)

The project team faced challenges in adhering to the ambitious schedule while ensuring a smooth transition. As Louis Szukics, Warehouse Engineering Manager at Renault noted: “Keeping to the schedule and achieving our ramp-up curve were major challenges. We are satisfied with the results achieved so far and are preparing to finalise the organisational transformation around this new facility.”

Key Outcomes

The implementation of the Exotec Skypod system has delivered significant benefits across multiple dimensions:

1. Operational Efficiency

• Order processing time reduced from 120 minutes to 20 minutes
• Ability to process up to 4,000 order lines per hour at peak times (up from ~670 previously)
• 25% increase in daily order capacity
• Productivity improved by a factor of 4 within the automated area

2. Customer Service

• Parts ordered by 5:30 PM now dispatched for next-day 8:00 AM delivery
• Over 99.7% customer service satisfaction rate achieved
• Faster order fulfilment enables quicker vehicle repairs and improved dealer/customer satisfaction

3. Space Utilisation

• Reduced storage footprint due to high-density vertical storage
• Ability to store 110,000 part references, including 20,000 in the automated system

4. Employee Safety & Satisfaction

• Elimination of manual high-reach tasks and associated fall risks
• Improved ergonomics with parts delivered to operators
• More engaging, technology-driven work environment

5. Sustainability

• 30% reduction in energy consumption compared to previous handling equipment
• Use of 65,000 recycled plastic storage bins

6. Flexibility & Scalability

• System can adapt in real-time to changing production needs
• Easy to add storage modules, robots, or modify conveyor layouts

7. Cost Savings

• Reduced reliance on temporary labour
• Lower energy costs
• Improved inventory accuracy and reduced losses

Financial Impact

While specific financial figures have not been publicly disclosed, the 25% increase in order capacity without a proportional increase in labour costs suggests significant improvements in operational efficiency and cost per order. The reduction in energy consumption and space requirements also contribute to ongoing cost savings.

The major capital investment in the Exotec system is likely justified by these operational savings, improved customer service levels, and strategic positioning of Renault’s aftermarket business for future growth.

Key Success Factors

Several factors contributed to the successful implementation and outcomes of this project:

1. Clear strategic vision: The transformation was part of a broader strategic initiative (OTAGO) to optimise Renault’s parts distribution network.
2. Selection of proven technology partner: Exotec’s track record with other major retailers and manufacturers reduced implementation risk.
3. Phased rollout: Starting with 20,000 part references allowed for optimisation before full-scale deployment.
4. Focus on employee engagement: Efforts to train staff and communicate benefits of the new system.
5. Attention to sustainability: Alignment with Renault’s broader environmental goals.
6. Integration of end-to-end process: Combining Skypod robots with other automated packaging systems for a holistic solution.

Lessons Learned and Future Outlook

The success of the Villeroy transformation provides several key takeaways:

1. Automation can deliver simultaneous improvements in efficiency, service levels, and sustainability.
2. Partnerships with innovative technology providers can accelerate transformation in traditional industries.
3. Employee buy-in and training are critical for successful adoption of new technologies.
4. Flexible, scalable systems are essential to adapt to changing market demands.

Looking ahead, Renault Group is well-positioned to leverage this experience to further optimise its global parts distribution network. Potential next steps could include:

• Rollout of similar automation to other major distribution centres
• Exploration of predictive analytics and AI to further improve inventory management and demand forecasting
• Integration with emerging technologies like autonomous delivery vehicles

Renault Group’s implementation of the Exotec Skypod system at its Villeroy warehouse represents a significant leap forward in automotive aftermarket logistics. By embracing cutting-edge robotics technology, Renault has not only improved its operational efficiency but also enhanced customer service and sustainability. This case study demonstrates the potential for innovative automation solutions to transform traditional industrial operations and create competitive advantage in the rapidly evolving automotive sector.