Cardboard boxes are delivering more than parts to Yanfeng Automotive Interiors’ North American plants — they’re also delivering millions in production savings.
Humble cardboard cartons, among the lowliest commodities in the long auto manufacturing supply chain, have gotten an innovative new design from a third-party supplier that allows Yanfeng to reuse them repeatedly back and forth between plants.
By reducing the volume of packaging material it consumes, the company has saved $10 million over the past 24 months, according to David Colclough, Yanfeng‘s senior buyer for North American packaging. The new cartons have stronger construction with greater stacking strength, but can be easily flattened and returned for use when Yanfeng ships components from Mexico and among its 21 North American plants.
“Corrugated boxes have been used for a hundred years and people have always perceived them as a disposable material,” Colclough told Automotive News. “But we found a product that’s a lot more durable. It’s still basically paper, so it’s not going to last forever. But we’re finding that in some cases, we can get 10 turns from a single box.”
It didn’t hurt that the switch occurred during a period of cardboard cost inflation. Corrugated material prices have gone up by about $60 a ton, according to the packaging and logistics software firm Lumi.
Yanfeng’s solution, sold under the marketing name “P2,” is the brain child of Rudy Youell, CEO of P2 Packaging in Dublin, Ohio. Youell previously owned packaging material firm American Corrugated Products, which served primarily Tier 1 auto suppliers in six states, but which he sold in 2016. He said his team stumbled onto the idea of making a cardboard box stronger by making separators out of the same material as the box, but customizing it to fit the specific components being shipped. That allows a manufacturer to fit more individual components into each carton, which translates into fewer shipments.
“In this business, every year like clockwork, customers want cost reductions. They want to beat down the cost of your product” Youell said. “But a corrugated box? What are you going to do with that?”
Youell notes that a P2 box costs 30 to 40 percent more than a standard cardboard box. “But if you use it six or seven or with times, it’s just money in the bank.”
Youell has licensed three U.S. companies to produce the new packaging: The Royal Group of Greenfield, Ind.; Anchor Bay Packaging in New Baltimore, Mich.; and Concept Packaging Group in Spartanburg, S.C.
Colclough is downright zealous about the innovation. “It’s kind of exciting,” he said, acknowledging his own enthusiasm over something as basic as cardboard.
“With all of the pressures and price increases the supply chain is experiencing, you just can’t ignore this. I’ve been working in the auto industry for 30 years, and nothing’s come along that moves the needle like this packaging solution.”