General Motors - Managing damage done to vehicles during transport

BUSINESS CHALLENGE

General Motors sells vehicles all over South America. Every time a vehicle is transported, there is a risk of damage. From the moment it leaves the factory until it arrives at the dealer, a vehicle can be transported by road, rail and sea. Damage can be small, like a scratch, or it can be total destruction. GM needed better damage information to control the risk better, and reduce insurance costs. It also needed a way to know the exact position of each vehicle at all times.

SOLUTION

In 2001, Bureau Veritas created a new service for GM called Vehicle Damage Tracking (VDT). The concept is simple but effective: every time a vehicle is moved, it is inspected. Initially, the service was provided in Argentina, Brazil and Chile; it has now been extended to include Colombia, Ecuador and Venezuela. Each inspector is equipped with a portable scanner to record the Vehicle Identification Number. If any damage can be seen, it is recorded with a special code to describe the damage. If there is major damage, digital photos are taken. On the same day, all information can be put onto BVnet, the secure Bureau Veritas intranet. This Web-based tool can then be accessed by all authorized parties: GM logistics, transport companies, shipyards and insurance companies. The system also enables GM to track the position of each vehicle. If a repair is needed, the system reports it. A local reporting meeting is held each month in each country. All the partners involved in vehicle transport for GM are present. They look at performance in the previous month, identify problems and look for solutions. If one transport partner is responsible for more damage than others, it pays more insurance premium.

BENEFITS

For GM, this service is extremely important in managing insurance claims. It also helps to reduce GM's insurance costs. Another benefit is that dealings with GM's transport partners are now smoother and easier. All players who share the insurance cost are more happy with the new system. They accept the independent information provided by Bureau Veritas. Previously, each player employed its own surveyor. Now there are no arguments about whether the reporting is accurate or not. With 6 countries now active in VDT for GM, Bureau Veritas is able to take advantage of synergies between countries: since everyone works with the same system, new teams can easily get support from more experienced teams, skills can be shared, and GM can enjoy the same level of service in all its markets. In April 2005, General Motors Argentina presented Bureau Veritas with a Certificate of Merit for excellence in performance with its Vehicle Damage Tracking service.