Monday, May 3, 2010

Computer glitch hits Proton delivery system

By Habhajan Singh & Ishun P Ahmad

Proton cars faced what is probably its worst delivery hick-up when a new central logistics hub meant to improve delivery from the manufacturer to dealers nationwide broke down due to a computer glitch.

With car delivery grinding to a near halt for a good part of April, the national car maker could see a massive drop in the registration of Proton models for the month as most dealers were unable to secure units to deliver to customers. It is understood that Proton Edar Sdn Bhd, the marketing arm of Proton Holdings Bhd, has outsourced the task of managing the logistics hub to public listed Konsortium Logistik Bhd and that the hub was supposed to have commenced on April 1.

Proton Edar general manager for sales Sidik Abd Hamid told The Malaysian Reserve that Proton has reverted to the conventional mode of delivering cars to dealers for the moment as it works to resolve the computer glitch at the new centralised logistics hub at Sijangkang, near Klang.

"There was some system error and it could not capture the barcodes of the cars parked at the hub. The cars started piling up," he said.

Beginning April 1, Proton Edar started utilising the centralised logistics hub in an effort to improve its supply chain. Under the plan, all cars from the Shah Alam manufacturing plant were sent to the Sijangkang yard for a pre-delivery inspection (PDI) and storage before being sent via trucks to dealers nationwide. Cars from Proton's Tanjung Malim plant were sent to a yard within the plant itself.

In a memo dated April 1, Proton Edar told its dealers that the effort was to 'improve its supply chain to meet fast changing business requirements and achieve cus tome r s at i s f ac t ion through speed and quality'. The idea — internally known as 'Class', which is short for centre for logistics, allocation, storage and service — was to 'specifically address the vehicle flow from manufacturing plant up to delivery to end customers'.

The memo stated that each hub would be equipped with facilities to support centralised services such as stock management, vehicle storage maintenance, pre-delivery inspection and repair jobs. Prior to this, car dealers handled areas like the predelivery inspection and repairs before handing the car to customers.

"On paper, the idea is perfect. The logistics hub is to benchmark the qualit y standard for all Proton cars leaving the hub. The hub was supposed to standardise that portion of the job," said Proton Edar Dealers Association Malaysia (PEDA) president Armin Baniaz Pahamin.

Hence, Armin said that customers would benefit in the long term after enduring this short term delay as Proton Edar sorts out the glitches at the logistics hub. Proton Edar is now also looking at back-up plans in the face of the problems at Sijangkang.

"We are devising Plan B and Plan C, should the hub face similar problems. We had done trial runs earlier, and things moved smoothly," said Sidik when asked if the national car maker's distribution arm had done a test run.

As at the end of last week, Sidik said the cars stuck at the Sijangkang hub have been allocated to the respective dealers.

Konsortium, a public listed company that in 2008 earned 27% or RM70.3 million of its revenue from the automotive logistics segment, has yet to revert to queries on the problems at the logistics hub. It is understood that the project comes under the purview of its executive director Che Azizuddin Che Ismail. He is responsible for overseeing the logistics operations of Konsortium, specifically the automotive, oil and gas, container haulage, Westport Distripark, distribution logistics and group human resources, according to the company's most recent annual report available on its website.