Al-Futtaim Logistics purchases more customised vehicles and brings transport business in-house

Al-Futtaim Logistics previously operated its own fleet mainly for automotive and international transportation.

This new business direction for Al-Futtaim Logistics follows the cancellation of third-party transportation contracts for domestic transportation. The fresh approach also comes close on the heels of the award-winning logistics company purchasing 35 tractor heads from Hino and Volvo, both Al Futtaim Group companies and 60 customized container flatbeds, box-vans and taut-liner trailers from Munro International, a well established Transport equipment provider.

The moving of its fleet operations in-house is also seen as a measure of strong confidence in the company's ability to gain fresh business initiatives during these difficult times when many logistics companies have adopted a cautious approach towards development plans.

Al-Futtaim Logistics estimates this move will enable the company to reduce operating costs by 15% over the lifetime of the vehicles. Delivery of the vehicles started in March '09.

Tom Nauwelaerts, Head of Logistics at Al-Futtaim, said:

"The current economic climate has helped us look at all aspects of our business and after a thorough review we felt there was a solid business case to move our transportation function in-house."

"Clearly, the numbers added up. We just knew that it would be better for our customers and thus better for us. This confidence can be attributed to the vast experience of being part of the Al-Futtaim group which owns and operates through more than 65 companies in sectors as diverse as retail, real estate, commerce, industry and services," he said.

Tom Nauwelaerts also said deteriorating service levels, increased prices from transportation subcontractors and substandard equipment that did not truly match the requirements were identified as the key drivers for the decision to bring the transportation function in-house.

"This move has enabled us to become extremely competitive by combining day time transportation with night time operations thereby ensuring maximum utilization of the vehicles. Throughout history, the UAE and Dubai in particular, has been a central location on global trading routes. The major challenges for the logistics industry at the moment however, despite major transformations, are bringing professionalism to all players and facets of the sector," added Tom.

Al-Futtaim Logistics offers a full range of supply chain solutions that include temperature controlled Warehousing & Distribution, Road Transportation, Sea and Airfreight forwarding to a blue chip clientele and currently has over 200 Volvo and Hino vehicles in its fleet.