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It was 2007 when Valk Welding delivered the first welding robots to the STAS factory in Doornik, Belgium.

Today that successful partnership continues, recently marked with the delivery of a large welding robot installation for the main STAS plant in Waregem, where its aluminium tipper trucks are produced.

In the last 18 years STAS has undoubtedly undergone a significant evolution in technology, even receiving ‘Factory of the Future’ award for both of its sites.

What STAS has learned is that automation doesn’t negate the need for people – quite the opposite.

“Within the factory of the future, a human-centred organisation is paramount, and this is largely reflected in the way we have automated production, especially the welding department,” said Senior Automation Engineer, Patrick Hugelier.

Aluminium tippers

With its aluminium self-dischargers and tippers, STAS focuses on the transportation of bulk goods. Transporters using self-dischargers and tippers place great importance on stability, reliability and low vehicle weight.

Welding aluminium panels requires special attention because of specific challenges, such as the low melting point and the high risk of contamination of the weld pool. In previous installations in Doornik, STAS used many short robot programs per production order. This lowered the entry threshold for the welders who were operating the installation. The combination of STAS’s control software and Valk Welding’s robot expertise has proven that a stable process can be achieved.

Six welding robots

The most recent project at STAS consists of two production lines with a total of six welding robots. These installations are used for producing aluminium floor panels and sidewalls for tippers and can significantly reduce production lead times.

“High user-friendliness of the installations has always been the starting point,” Hugelier said. “The machine must adapt to the people, not the other way around. This has mainly been solved through software. Within this setup, our welders are now process and quality controllers, providing higher added value to the entire organisation.”

Custom software

Key to making the technology work and remain sucessful at STAS was the establishment of an internal automation department which works hand in hand with Valk Welding’s software engineers.

“Thanks to the combination of our own machine control and Valk Welding’s ROSE server, we can control, monitor, and adjust production within the new installation,” Hugelier said. “We have also created our own link to our Enterprise Resource Planning (ERP) package. It is safe to say that an important part of the success of ‘human-friendly’ automation lies with the software.”

SQUADRON

Having this newfound knowledge has meant sharing information via SQUADRON, a network of business process experts. Through SQUADRON, STAS offers its experience to assist other SME manufacturing companies with end-to-end digital transitioning. Besides welding automation, SQUADRON also takes care of linking IT-related matters, such as ERP integration and MS Power Apps, to operational matters such as project management, the development of user-friendly software and the visualisation of production data.

Single-piece production

SQUADRON has developed an ERP package with a vehicle configurator for STAS, allowing dealers to configure all available variants there. When the configuration is converted into an order, this data automatically drives and generates material procurement, production planning, and welding programs. In this way, STAS can achieve single-piece production, similar to the automotive industry.

Challenges

The next step for STAS is further integration to reduce even more ancillary activities .

“The goal is to add value only to the end product and to eliminate all waste,” Hugelier said. “We are also still at the beginning when it comes to processing data. If we can add AI intelligence to the data, we should be able to initiate preventive actions online to avoid downtime. Realising this will be an exciting challenge in the future.”

A rise in e-commerce sales, consumer demand for faster delivery times, geopolitical re-shoring of manufacturing and post-pandemic inventory rebuilding are contributing factors for growing demand in the logistics space according to David Roberts, Head of Real Estate Strategy at Macquarie.

Despite growing demand and rent rises, higher interest rates and capital market volatility are triggering refinancing and redemption pressure among asset owners who are selling down highly liquid logistics assets. With the rise in building costs which have impaired construction activity, there could be a supply issue for industrial assets in the future.

Logistics, according to Roberts, is a simple business at its core – efficiently distributing goods to households, retailers and businesses.

“But the apparent simplicity hides a fast-growing, sophisticated and complex network of operations feeding an ever-more-demanding consumer,” he said. “Traditional mail-order timeframes have evolved into today’s fast-paced system of next-day, same-day, and even within-the-hour delivery. But alongside the rapid growth of e-commerce, businesses are also investing in reshoring global supply chains and building inventories to protect against future shortages – further fuelling demand for warehousing space.”

In contrast to other key developed markets, Roberts said accommodative lending conditions and positive leverage continue to support logistics pricing in Japan.

“Attractive cash-on-cash yields and strong demand fundamentals are supporting demand for logistics exposure from domestic and foreign real estate investors. Furthermore, monetary policy is likely to remain accommodative as Japan grapples with demographic headwinds and underlying soft demand conditions as its population ages.

“Should rates tighten over the next 12-24 months, for example to support a cyclical recovery in the currency, any tightening is likely to be quickly reversed when the global monetary easing cycle begins and underlying demand conditions weaken.”

Demand for logistics space, according to JLL, is now at cyclical highs reflecting the ongoing shift to online spending, consolidation of existing operations and drive for efficiency with occupiers shifting to newer modern facilities underpinning development strategies.

Firms, Roberts explained, are also increasingly considering automation of their facilities to address labour shortages which is boosting demand for modern logistics facilities that can accommodate such shifts.

He said rents are expected to continue to rise, reflecting a combination of higher land prices and construction costs which is putting upward pressure on prices for newly completed properties. Rising construction costs are also likely to impact development pipelines for weaker projects in non-core locations.

Looking at industrial rental growth change between June 2020 to June 2023 (data via PMA, CoStar, JLL, as at September 2023), London has seen the most change at nearly 60 per cent. Inland Empire falls in at close to 50 per cent while Los Angeles and Sydney sit near the 40-per-cent mark. Other cities reported include New York (30 per cent), Munich (29 per cent), Singapore (25 per ent), Paris (18 per cent) and Hong Kong and Greater Tokyo under 10 per cent.

Fleet moves down under

In September 2023, Liquefied Petroleum Gas (LPG) marketer, Elgas, agreed to acquire Rivet Energy, which it claims is Australia’s largest LPG fleet operator.

Rivet Energy, a provider of gas and liquid fuel transportation and distribution services, currently services 100 per cent of Elgas’ bulk haulage requirements across Australia.

As part of the acquisition, Elgas will purchase all of Rivet Energy’s assets including its transport fleet of trailers, tankers and prime movers.

It will also retain Rivet Energy’s depots and workforce.

Elgas and BOC Managing Director, Binod Patwari, said the acquisition would secure Elgas’ LPG supply chain nationally and provide strong security of supply to thousands of customers across Australia.

“We are delighted to welcome Rivet Energy to the Elgas business and are confident this acquisition will safely deliver greater efficiencies and productivity across our transport fleet with access to industry-leading transport maintenance facilities and expertise,” he said.

“Rivet Energy has a highly experienced management team and drivers who share our strong commitment to safety and have an excellent track record hauling dangerous goods.

“We look forward to working closely together to strengthen Elgas’ national LPG supply chain and deliver strong security of supply to Elgas customers.”

Rivet Energy General Manager, Mark Anderson, said he was delighted to expand the longstanding, productive partnership between Rivet Energy and Elgas.

“We are thrilled to be securing the future of the Rivet Energy business, including the ongoing employment of our experienced staff and drivers who can now be part of Australia’s largest supplier of LPG,” he said.

“Our transport industry experience and specialist workshops in key metropolitan locations throughout Australia will be a valuable addition to the Elgas transport fleet and delivery services for customers.”

Meanwhile, Austria’s Gebrüder Weiss is expanding its network in Australia with the opening of a new Air and Sea office in Brisbane.

This is now the third location operated by the international logistics company in Australia, following on from Sydney and Melbourne, and will be tailored to customers from the engineering, agriculture and medical equipment sectors.

“Opening a location in Brisbane represents another key step in our efforts to increase our presence in Australia,” said Managing Director Australia and New Zealand, Andrew Antonopoulos. “The services include air & sea transports, customs clearance and a customised logistics mix for project orders.”

Brisbane’s container port, with a record throughput of 1.56 million standard containers last year, is the most important international transhipment hub in the city, while the nations’s most significant import partners are China, the United States as well as other Asian countries such as South Korea and Japan.

“We offer efficient end-to-end logistics solutions for connections with the rapidly growing amount of intra-Asian traffic,” said Regional Manager East Asia/Oceania, Michael Zankel.

Most recently, Gebrüder Weiss organised the transport of an innovative solar car from Switzerland to Australia and back for the ETH Zurich’s aCentauri Solar Racing Team who covered a distance of 3,000 km across the Australian outback using only solar power.

Gebrüder Weiss has plans to open additional locations in the north and west of Australia to provide blanket coverage for the whole continent. It also has a foothold in New Zealand with locations in Auckland and Christchurch.

North American sales

Trucking company, XPO Inc, was the top bidder at a sale of bankrupt Yellow’s assets, winning the right to 28 service centres at a price tag of $870 million USD.

The 100-year-old transport firm, which serviced the less-than truckload market, filed for bankruptcy protection in August blaming ongoing strike action by the International Brotherhood of Teamsters union for its financial woes.

Yellow’s 17.5 million annual shipments made it the third-largest in the US, but it had an outstanding debt of about $1.5 billion as of March, despite receiving a $700 million loan from the federal government in 2020. The company had been in an ongoing battle with the Teamsters union, which represents 22,000 drivers and dock workers, over unpaid pension and health insurance contributions.

According to a report by Reuters, XPO expects the deal, which is subject to court approval, to add to core profit in 2024 and adjusted profit per share from continuing operations from 2025.

XPO’s successful bid was part of a court-supervised auction that saw nearly two dozen companies, including Estes Express Lines and Knight-Swift Transportation Holdings, win rights to purchase Yellow’s assets for $1.88 billion, as per a court filing on Monday.

European game changer

The DB Group is looking to minimise debt by potentially selling its logistics business.

A sale will only be settled, according to DB Group, if it has apparent economic advantages for Deutsche Bahn in all respects.

“A sale would significantly accelerate Deutsche Bahn’s focus on its core business and the implementation of the Strong Rail strategy,” DB Group said in a statement.

“Deutsche Bahn has already completed or contractually agreed the sale of several of its business units in foreign markets and would be taking another big step by letting go of DB Schenker. Our goal is to serve the climate, people and the economy by substantially increasing the cargo and passenger volumes handled by eco-friendly rail services.”

While DB Schenker has contributed positively to DB Group’s economic growth over the years, the DB subsidiary will need additional capital and flexibility for its own growth.

In December 2022, the Supervisory Board of Deutsche Bahn AG assigned DB’s Management Board the task of examining the case and preparing for a potential sale of its entire shares in DB Schenker. The final decision on a sale of DB Schenker will be based on a separate resolution adopted by the Supervisory Board of Deutsche Bahn AG at the end of the sale process. The process is also subject to general capital market developments.

Compared to its competitors, DB Schenker has a strong position in all the relevant industry sectors – land, air and ocean freight – and in comprehensive and specialised logistics solutions. With some 76,600 employees at over 1,850 locations in more than 130 countries, the company is one of the world’s leading logistics providers.