Don't miss your next business season!
All over the world various mobility solutions are becoming more and more popular. However, the global shortage of semiconductors and many other parts required to produce vehicles, as well as challenges in logistics are becoming increasingly apparent. Even big companies including carmakers and Apple have been forced to announce that they are cutting production. So if you are planning to launch or expand your mobility business during the next season, this is the last moment to order vehicles and get ready.
Before starting any mobility business, there are three aspects you must consider: market research, software integration, and hardware, as well as vehicle manufacturing and delivery. Market research is entirely dependent on your efforts. You can leave the software to ATOM. Adapting ATOM software to your business idea won't take more than 20 days. However right now the biggest challenge currently all over the world is hardware and vehicle manufacturing and delivery.
Force majeure started shortly after the pandemic, with a dramatic increase in demand for different materials that were previously available in appropriate amounts. Unfortunately, at ATOM we experienced situations when our clients were ready to start their mobility businesses in March and April 2020, but couldn’t launch it before September and even October for the simple reason that vehicles had not yet been delivered. So they just had to watch in frustration as the hottest season passed them by.
It’s a bit easier in Europe
What options of ordering vehicles do you have? If you are located in Europe, then, of course, Europe is the first thing that pops up in your mind. However, the spring of 2020 showed that the availability of vehicles in Europe is extremely limited. If you are not planning a big fleet, then you can probably get by somehow. But if you are planning a fleet with over 100 units, there are just a few options.
The other option is China. ATOM team can help you with contacts, but even so, the task is not simple. It takes time to negotiate with hardware and vehicle providers. You should double-check and make sure that all the details are right, all the documents are in order, and that the vehicles will be ready, as well as shipped on time.
Up to 90 days
At the end of the day, it doesn't matter what manufacturer you choose, the manufacturing lead time starts from the down payment. Depending on the fleet size ordered, you should bear in mind that the lead time may range from 40-90 days. Any customized products or special orders will increase the production lead time to 60-90 days. And it still depends on the number of orders made at the same time by different clients.
The closer the season gets, the more orders can be made. This could also influence the price - the manufacturer may decide to charge more if demand is high. This means unexpected expenditures for you even before your business is up and running.
Fernando Brito, Sales operations manager at ACTON, one of the leading micro-mobility vehicle manufacturers on the market, says that you should definitely add six weeks to the schedule before making a discovery call to the manufacturer and making your final decision. “Normally it takes several meetings to reach a decision. During the first meeting, ACTON usually presents its solutions and listens to the customer’s needs. The next step is the making of a quote. Of course, this usually also creates some discussions and throws up additional issues like shipping costs, taxes, production lead time, and also needs regarding any specific local regulation. Beyond this, this step usually leads to a demo call where all technical and specification details about the vehicles are covered. If everything goes well, then the decision to proceed is made and production can begin. However, negotiations can take more time. In addition, complicated regulatory compliance can require extra meetings about the really specific features of the vehicle. So it is better, of course, to have extra time so you don’t find yourself having to make any decisions in a hurry,” says Fernando.
Additionally, at the beginning of the high season, everything can get a bit crazy. “We try to ensure that our production can fulfill that demand. Moreover, as we grow we are increasing our operational capacity in several markets - namely, Europe - with new facilities and additional personnel. Right now, we are not experiencing any queues for orders, because we’ve planned our production accordingly, and we manage customer expectations successfully,” explains Fernando. He says that ACTON has some batches of vehicles in stock so the company is ready for extra orders of standard vehicles - these can be shipped within 2 to 3 weeks.
There is still one phase to consider and this is delivering the product to the owner. Covid-19 has posed new challenges to logistics. According to a representative of our logistics partner ACE logistics, planning and implementing logistics could be a real struggle at present: “The pandemic has had a major impact on supply chains all over the world. There were periods when the main Chinese ports were closed for several weeks due to quarantine. There have been movement restrictions in countries due to COVID-19. Factories are short of personnel and therefore the fulfillment of orders is subject to long delays. At the same time, the global consumption boom and economic growth are demanding ever more manufactured goods.”
And with no prospect of a brighter outlook in the immediate to short term, this should be taken into account while planning any orders. According to ACE logistics, the peak importing season from Asia has always been and will be the period from Golden Week in October to the Chinese New Year. During this three to four-month period, massive volumes of industrial, seasonal, and lifestyle goods are exported from China. Historically, spring and summer are a quieter period in terms of freight volumes, which has also led to some slackness inactivity. Unfortunately, this was not the case in 2021. “Since November 2020, we have continued to see freight rates rising several times a month. Waiting times for an empty container and available space on board have already exceeded four to five weeks. Huge volumes of goods have also hit the speed of customs clearance. In addition, we are seeing our customers struggle with manufacturers, who are also under strain. The energy crisis leaves a strong mark on all parties involved. And the global consumption boom is significantly extending the originally planned lead-time,” warns the ACE logistics representative.
Are you ready for the spring of 2022?
Preparations for the spring season are now in full swing. If your goal is to get goods to Europe by the beginning of March 2022, waiting times for empty containers and berths are up to a month. Additionally sea transit times from China to European ports are approximately four to six weeks. Now is the time to lock in deals in the coming weeks! However, it is important to keep in mind that even the best planning is no guarantee that the desired deadlines will be met.
In short, you have to make a decision and place an order for manufacturing hardware and vehicles for your mobility business no later than the middle of December before the Christmas holidays. Then you might get your order by the beginning of the season in March. Orders from manufacturers in Europe are a bit easier, but the availability of vehicles in stocks in Europe could be extremely limited.
All additional measures required to launch your mobility business when your vehicles arrive should be done simultaneously. ATOM can start to prepare all the necessary configurations and integrations for your hardware right away. It will be ready in a maximum of 20 days. Contact us here!