10.05.2018

Parts issues for Terex Cranes

Terex Cranes president Steve Filipov has written to customers regarding the recent parts issues, following the consolidation of the parts business into the group’s third party managed parts centre in Roosendaal, the Netherlands.

As is often the case with such moves, the transfer has resulted in longer lead times, dispatch speeds and some availability issues. In his letter he confirms that a specialist Terex parts team is working with the third party supplier to identify and fix issues which they now confirm are due to issues such as IT interfaces between Terex and its logistics partner, gaps in data quality, supply chain disruptions and a steeper than anticipated learning curve for the logistics provider, in spite of the fact that it has managed Genie replacement parts for several years.

The letter is published in full below.

“To our valued customers:

Last summer, Terex Cranes embarked on a bold program to improve our mobile crane spare parts fulfillment by consolidating multiple European parts warehouses into one centrally located, state-of-the-art distribution center in Roosendaal while partnering with a world-class logistics provider. This plan will ultimately help us to serve you better with increased availability and faster delivery than what we were capable of before.

We are in the final stages of the consolidation, and we remain confident that this initiative will improve our responsiveness to all of our European crane customers over the long term. However, we have encountered some short-term issues that have been more disruptive than we anticipated. Namely, our parts availability, lead times and responsiveness speed has suffered, while our parts order backlog has grown.

Terex Cranes takes seriously any disruption in meeting our commitment to supporting you and your business efforts. Therefore, we have assigned a dedicated, experienced team whose mission is to assess and address these short-term disruptions. The team has identified several root causes of these issues, which include IT interfaces between Terex and our logistics partner, gaps in data quality, supply chain disruptions, and a steeper-than-anticipated learning curve for our logistics provider.

We have already implemented a number of countermeasures to address these disruptions, and the initial results are encouraging. Additional dedicated resources are now in position to resolve the key root causes of these disruptions, and we have a plan and people in place to work through the existing backlog issues.

At this time, parts availability is improving and incoming parts orders are being fulfilled faster than before. The overall parts order backlog has stabilized and started to shrink. We anticipate our parts fulfillment operations to be back to normal by early summer, and by summer’s end, we expect to achieve our overall goal of you experiencing improved performance and higher fill rates from our centralized European parts distribution strategy.

Thank you for your continued business and trust in Terex Cranes!

Sincerely,

Steve Filipov
President - Terex Cranes”