Using easy-to-install kits made from off-the-shelf components, Toyota converted 22 tow tractors at one of its plants into automated guided vehicles. Plans are now in the works to bring the technology to DCs.
Contributing Editor Toby Gooley is a writer and editor specializing in supply chain, logistics, and material handling, and a lecturer at MIT's Center for Transportation & Logistics. She previously was Senior Editor at DC VELOCITY and Editor of DCV's sister publication, CSCMP's Supply Chain Quarterly. Prior to joining AGiLE Business Media in 2007, she spent 20 years at Logistics Management magazine as Managing Editor and Senior Editor covering international trade and transportation. Prior to that she was an export traffic manager for 10 years. She holds a B.A. in Asian Studies from Cornell University.
Imagine walking into a material handling equipment maintenance and repair shop, pulling standard components off the shelf, and—with relatively little time and effort—turning an ordinary industrial tow tractor or forklift into an automatic guided vehicle (AGV).
That day isn't here just yet, but it's closer than you might think. An automation project at a Toyota auto manufacturing plant in Georgetown, Ky., has shown that it's possible to retrofit some types of manual equipment quickly and easily, earning a big return in terms of cost, labor, efficiency, and flexibility. Although the project involved a manufacturing environment, it may well serve as a prototype for bringing more AGVs to material handling environments, where they have yet to make major inroads due to their cost and complexity.
TOW TRACTOR TRANSFORMATION
Toyota Motor Manufacturing Kentucky Inc. (TMMK) makes the Camry, Venza, and Avalon models at the Georgetown facility, a 1,300-acre complex encompassing some 7.5 million square feet of manufacturing and assembly space. Like all Toyota operations, the Georgetown plant adheres to the Toyota Production System, also known as "just-in-time" or "lean" manufacturing.
Over the years, Toyota had honed production at the Georgetown plant to a high level of efficiency. But there was still room for improvement when it came to the internal movement of parts. The factory, built in 1988, is not as compact as newer facilities. As a result, workers delivering materials to the body-weld department had to drive long distances, navigating congested areas to drop flow racks and palletloads of parts at work cells. Sudden stops, complicated workflow paths, and the occasional traffic jam or collision led to product damage and delayed deliveries.
A team assigned to study the problem determined that automating the transportation of parts to the 1 million-square-foot body-weld area—in essence, taking human drivers out of the equation—would eliminate most of the delay and damage problems. Their conclusion may not be very surprising. What is surprising is the way TMMK accomplished that objective: Instead of purchasing new equipment, the factory chose to retrofit 22 of its Toyota 24-volt, AC-drive tow tractors with locally built automation kits that turned them into automatic guided vehicles.
To develop these "home-grown" AGVs, TMMK worked with two local business partners—AutoGuide, an automation specialist led by AGV innovator Paul J. Perry, and Industrial Concepts Inc. (ICI), a developer of custom machinery and control systems whose president, Tim Taylor, is a former TMMK mechanical whiz. (AutoGuide and ICI are closely allied; the two share a facility across the street from TMMK, and ICI's executives have an ownership stake in AutoGuide.)
Utilizing the same off-the-shelf devices already in use for other types of AGVs at TMMK, AutoGuide outfitted the 10,000-pound-capacity tow tractors with obstacle and guidance sensors, radio-frequency modems, RFID tag readers, and a touchscreen programmable logic controller (PLC) interface, among other technologies. All of the components are contained in a removable attachment designed by AutoGuide. Installation is a simple matter of drilling six holes in a tractor's chassis, and is the only physical change required, according to Tim Meyer, Toyota Production System solutions and AGV product manager for Toyota Material Handling U.S.A. Inc.
Flexibility was another reason TMMK chose to convert standard, manual equipment to AGVs. The stand-alone attachments can be installed either at the time of purchase or lease, or after the vehicles go into service, and they can be easily removed and reinstalled on other vehicles, Meyer explained during a tour of TMMK. Drivers can switch the tractors from automatic to manual mode simply by stepping on a pressure-sensitive mat in the driver's compartment.
NAVIGATING "SPAGHETTI JUNCTION"
Before the AGVs arrived in the body-weld department, manned tow tractors dropped off flow racks and pallets full of parts alongside each of the robotic welding cells, which were located on both sides of a wide aisle. Team members then picked up the parts they needed from racks and pallets on both sides of the aisle. The work and material flow for parts delivery to the robotic welding cells involved 16 stops, or actions, from pickup to placement in the welding robot load positions.
Today, the storage racks and pallets are gone. Now, a driverless tow tractor pulls as many as five dollies full of auto parts from the storage area to the cells, a distance of about 950 feet. Team members retrieve the parts they need from the dollies, which are positioned parallel to the cells just a few steps away, eliminating the need to cross the aisle. Once all the parts have been unloaded, the AGV returns to the storage area for more material, while another tractor with the next batch of parts arrives just when they're needed. Instead of 16 stops, there are only nine. And because the AGVs always travel the same route at the same speed, the time from pickup to arrival at the welding cells is consistent and predictable.
To get where they're going, the tow tractors follow over two miles of magnetic strip slotted into narrow troughs in the concrete floor. Their positions are tracked by RFID tags embedded in the floor.
Navigating the high-traffic body-weld department requires care and precision. The weld stations are positioned along a 300-foot "highway" with nine routes branching off and merging into it—an area known as "spaghetti junction." In addition, the tow tractors have to share the road, so to speak, with other Toyota AGVs (such as L-cart material transporters and low-profile "Mouse" tug-carts) that motor along the same magnetic guide paths. The tow tractors also cross paths with the manned vehicles that deliver partial loads and those destined for multiple drop-off sites. Drivers are required to yield to the AGVs.
To manage the movements of the automatic vehicles, TMMK's AGV implementation team worked with ICI to develop traffic-control technology that would be compatible with the guidance systems and control devices already in place for other types of AGVs. The resulting Automated Vehicle Intersection Navigational Utility (AVINU) is "the link between the AGVs and everything else that's automated," said ICI President Tim Taylor.
The wireless system communicates with the different types of AGVs, reporting each one's location, status, and performance data—information that can be viewed on any authorized computer in the facility. AVINU assigns loads to vehicles and regulates traffic at intersections; arrival at certain RFID tags triggers wireless transmission of instructions to the AGVs. The system also monitors battery status and tells the vehicles when to head over to an opportunity charger.
REACHING A BROADER AUDIENCE
Changing the way parts are delivered and reconfiguring the robotic welding cells has cut walking distances by 978 miles a year, saving five hours of walking time per shift—the equivalent of 317 work days annually, said Paul Stafford, specialist production engineering and AGV implementation lead. Furthermore, eliminating the storage pallets and flow racks opened up nearly 37 square feet of work space adjacent to each cell, freeing up space for other activities.
Because the AGVs travel the same paths at a consistent speed without so much as an inch of variation, they can safely navigate turns that would challenge human drivers—in some places, with less than six inches of clearance, according to Stafford. Congestion, collisions, sudden stops, and in-transit product damage have all been eliminated.
The labor savings have been equally impressive. The body-weld department has been able to reassign 42 people to other, more value-adding positions—including to the AGV implementation team—and nobody has been let go.
So far, the Toyota AutoGuide/AVINU project has saved TMMK more than $1 million annually, and ROI was achieved in just over one year. The payback has been substantial enough that the AGV implementation team will roll out the system elsewhere at Georgetown and will help to implement it at other Toyota auto plants.
The project foretells wider adoption of automation, not only in manufacturing but also in warehousing and distribution. In fact, AutoGuide attachments for Toyota pallet trucks and forklifts are already in the works. "I believe the automation market is limitless, although there will be challenges," Meyer said.
One of those challenges will be to convince warehouse and DC operators that automatic vehicles are not as complicated and expensive to purchase, install, and operate as they might think. That may not prove particularly difficult, however: Meyer estimates that the cost of a new, mass-produced vehicle plus the AutoGuide automation kit would be approximately one-fourth that of a custom-built traditional AGV. The fact that the AGVs are created from standard industrial vehicles and widely available, off-the-shelf components rather than proprietary controls will keep the cost down, he added.
Potential buyers will also want assurances of ready access to maintenance services for this new breed of AGVs, said Martin Boyd, vice president of product planning, marketing, and training for Toyota Material Handling U.S.A. Inc. That makes it critical to provide service for both the truck and the AGV components through the existing dealer network with its established relationships, he said.
Boyd agrees that lower-cost AGVs are poised for rapid growth. The economic downturn forced companies to look for waste, cut costs, and introduce more process efficiencies while considering how to better prepare for rapid change, he said in an interview at TMMK. Automation can help in all of those areas, and lift truck manufacturers will play a leading role in bringing it to a wider audience, he said. "We want to develop broader solutions around the customer to help them save money. We don't see automation as a competitor. We see it as an enabler."
Container traffic is finally back to typical levels at the port of Montreal, two months after dockworkers returned to work following a strike, port officials said Thursday.
Today that arbitration continues as the two sides work to forge a new contract. And port leaders with the Maritime Employers Association (MEA) are reminding workers represented by the Canadian Union of Public Employees (CUPE) that the CIRB decision “rules out any pressure tactics affecting operations until the next collective agreement expires.”
The Port of Montreal alone said it had to manage a backlog of about 13,350 twenty-foot equivalent units (TEUs) on the ground, as well as 28,000 feet of freight cars headed for export.
Port leaders this week said they had now completed that task. “Two months after operations fully resumed at the Port of Montreal, as directed by the Canada Industrial Relations Board, the Montreal Port Authority (MPA) is pleased to announce that all port activities are now completely back to normal. Both the impact of the labour dispute and the subsequent resumption of activities required concerted efforts on the part of all port partners to get things back to normal as quickly as possible, even over the holiday season,” the port said in a release.
The “2024 Year in Review” report lists the various transportation delays, freight volume restrictions, and infrastructure repair costs of a long string of events. Those disruptions include labor strikes at Canadian ports and postal sites, the U.S. East and Gulf coast port strike; hurricanes Helene, Francine, and Milton; the Francis Scott key Bridge collapse in Baltimore Harbor; the CrowdStrike cyber attack; and Red Sea missile attacks on passing cargo ships.
“While 2024 was characterized by frequent and overlapping disruptions that exposed many supply chain vulnerabilities, it was also a year of resilience,” the Project44 report said. “From labor strikes and natural disasters to geopolitical tensions, each event served as a critical learning opportunity, underscoring the necessity for robust contingency planning, effective labor relations, and durable infrastructure. As supply chains continue to evolve, the lessons learned this past year highlight the increased importance of proactive measures and collaborative efforts. These strategies are essential to fostering stability and adaptability in a world where unpredictability is becoming the norm.”
In addition to tallying the supply chain impact of those events, the report also made four broad predictions for trends in 2025 that may affect logistics operations. In Project44’s analysis, they include:
More technology and automation will be introduced into supply chains, particularly ports. This will help make operations more efficient but also increase the risk of cybersecurity attacks and service interruptions due to glitches and bugs. This could also add tensions among the labor pool and unions, who do not want jobs to be replaced with automation.
The new administration in the United States introduces a lot of uncertainty, with talks of major tariffs for numerous countries as well as talks of US freight getting preferential treatment through the Panama Canal. If these things do come to fruition, expect to see shifts in global trade patterns and sourcing.
Natural disasters will continue to become more frequent and more severe, as exhibited by the wildfires in Los Angeles and the winter storms throughout the southern states in the U.S. As a result, expect companies to invest more heavily in sustainability to mitigate climate change.
The peace treaty announced on Wednesday between Isael and Hamas in the Middle East could support increased freight volumes returning to the Suez Canal as political crisis in the area are resolved.
The French transportation visibility provider Shippeo today said it has raised $30 million in financial backing, saying the money will support its accelerated expansion across North America and APAC, while driving enhancements to its “Real-Time Transportation Visibility Platform” product.
The funding round was led by Woven Capital, Toyota’s growth fund, with participation from existing investors: Battery Ventures, Partech, NGP Capital, Bpifrance Digital Venture, LFX Venture Partners, Shift4Good and Yamaha Motor Ventures. With this round, Shippeo’s total funding exceeds $140 million.
Shippeo says it offers real-time shipment tracking across all transport modes, helping companies create sustainable, resilient supply chains. Its platform enables users to reduce logistics-related carbon emissions by making informed trade-offs between modes and carriers based on carbon footprint data.
"Global supply chains are facing unprecedented complexity, and real-time transport visibility is essential for building resilience” Prashant Bothra, Principal at Woven Capital, who is joining the Shippeo board, said in a release. “Shippeo’s platform empowers businesses to proactively address disruptions by transforming fragmented operations into streamlined, data-driven processes across all transport modes, offering precise tracking and predictive ETAs at scale—capabilities that would be resource-intensive to develop in-house. We are excited to support Shippeo’s journey to accelerate digitization while enhancing cost efficiency, planning accuracy, and customer experience across the supply chain.”
Donald Trump has been clear that he plans to hit the ground running after his inauguration on January 20, launching ambitious plans that could have significant repercussions for global supply chains.
As Mark Baxa, CSCMP president and CEO, says in the executive forward to the white paper, the incoming Trump Administration and a majority Republican congress are “poised to reshape trade policies, regulatory frameworks, and the very fabric of how we approach global commerce.”
The paper is written by import/export expert Thomas Cook, managing director for Blue Tiger International, a U.S.-based supply chain management consulting company that focuses on international trade. Cook is the former CEO of American River International in New York and Apex Global Logistics Supply Chain Operation in Los Angeles and has written 19 books on global trade.
In the paper, Cook, of course, takes a close look at tariff implications and new trade deals, emphasizing that Trump will seek revisions that will favor U.S. businesses and encourage manufacturing to return to the U.S. The paper, however, also looks beyond global trade to addresses topics such as Trump’s tougher stance on immigration and the possibility of mass deportations, greater support of Israel in the Middle East, proposals for increased energy production and mining, and intent to end the war in the Ukraine.
In general, Cook believes that many of the administration’s new policies will be beneficial to the overall economy. He does warn, however, that some policies will be disruptive and add risk and cost to global supply chains.
In light of those risks and possible disruptions, Cook’s paper offers 14 recommendations. Some of which include:
Create a team responsible for studying the changes Trump will introduce when he takes office;
Attend trade shows and make connections with vendors, suppliers, and service providers who can help you navigate those changes;
Consider becoming C-TPAT (Customs-Trade Partnership Against Terrorism) certified to help mitigate potential import/export issues;
Adopt a risk management mindset and shift from focusing on lowest cost to best value for your spend;
Increase collaboration with internal and external partners;
Expect warehousing costs to rise in the short term as companies look to bring in foreign-made goods ahead of tariffs;
Expect greater scrutiny from U.S. Customs and Border Patrol of origin statements for imports in recognition of attempts by some Chinese manufacturers to evade U.S. import policies;
Reduce dependency on China for sourcing; and
Consider manufacturing and/or sourcing in the United States.
Cook advises readers to expect a loosening up of regulations and a reduction in government under Trump. He warns that while some world leaders will look to work with Trump, others will take more of a defiant stance. As a result, companies should expect to see retaliatory tariffs and duties on exports.
Cook concludes by offering advice to the incoming administration, including being sensitive to the effect retaliatory tariffs can have on American exports, working on federal debt reduction, and considering promoting free trade zones. He also proposes an ambitious water works program through the Army Corps of Engineers.
ReposiTrak, a global food traceability network operator, will partner with Upshop, a provider of store operations technology for food retailers, to create an end-to-end grocery traceability solution that reaches from the supply chain to the retail store, the firms said today.
The partnership creates a data connection between suppliers and the retail store. It works by integrating Salt Lake City-based ReposiTrak’s network of thousands of suppliers and their traceability shipment data with Austin, Texas-based Upshop’s network of more than 450 retailers and their retail stores.
That accomplishment is important because it will allow food sector trading partners to meet the U.S. FDA’s Food Safety Modernization Act Section 204d (FSMA 204) requirements that they must create and store complete traceability records for certain foods.
And according to ReposiTrak and Upshop, the traceability solution may also unlock potential business benefits. It could do that by creating margin and growth opportunities in stores by connecting supply chain data with store data, thus allowing users to optimize inventory, labor, and customer experience management automation.
"Traceability requires data from the supply chain and – importantly – confirmation at the retail store that the proper and accurate lot code data from each shipment has been captured when the product is received. The missing piece for us has been the supply chain data. ReposiTrak is the leader in capturing and managing supply chain data, starting at the suppliers. Together, we can deliver a single, comprehensive traceability solution," Mark Hawthorne, chief innovation and strategy officer at Upshop, said in a release.
"Once the data is flowing the benefits are compounding. Traceability data can be used to improve food safety, reduce invoice discrepancies, and identify ways to reduce waste and improve efficiencies throughout the store,” Hawthorne said.
Under FSMA 204, retailers are required by law to track Key Data Elements (KDEs) to the store-level for every shipment containing high-risk food items from the Food Traceability List (FTL). ReposiTrak and Upshop say that major industry retailers have made public commitments to traceability, announcing programs that require more traceability data for all food product on a faster timeline. The efforts of those retailers have activated the industry, motivating others to institute traceability programs now, ahead of the FDA’s enforcement deadline of January 20, 2026.