Electric vehicles. They’ve dominated discussions in the auto industry as of late, and they are likely posted for growth in coming years.

EV and all the moving parts they entail (charging infrastructure, battery health, range calculation, etc.) have been brought to the forefront, as the energy industry turns away from fossil fuels toward cleaner energy resources.

Consumer demand and production are on the rise, but the logistical questions and challenges related to this shift toward EVs are plenty. And one of these is transportation, according to RPM, one of the largest EV transport providers in the market.

RPM has recently partnered with Rivian, an electric vehicle automaker and automotive tech company, to streamline shipment of electric vehicles and address what RPM sees as unique logistical challenges that automakers and suppliers face in the transport of these next-generation vehicles.

Rivian was in the news toward the end of 2021, as the company completed its initial public offering, after securing relationships with companies like Lincoln, for manufacturing, and Chase, to facilitate consumer financing.

Rivian and RPM will be partnering to better handle the complex, end-to-end shipment of the automaker’s electric vehicles.

Tom Reid, who is vice president of logistics and applied solutions at RPM, spoke to Auto Remarketing about the unique obstacles that automakers and suppliers face in EV supply chain management — and how to address these challenges.

“We take a quality and sustainability focused approach, and we collaborate with our customers and our carriers to solve the challenges with distribution and delivery of finished vehicles within their networks,” said Reid.

With COVID challenges, a changing consumer landscape, microchip shortages and more, there’s a lot to think about — and a lot at stake — for both established OEMs and new entrants into the EV market.

“It's a really challenging time to not only produce vehicles, but also distribute them efficiently and match up carriers and capacity with the goals of the OEM as an organization,” Reid said.

And that’s where RPM fits in, he said. The company leverages a group of thousands of carriers with varying equipment types and sizes and needs.

“And our goal every day is to learn the carriers’ needs and OEM needs and build networks around what our customers are looking to accomplish within their distribution strategy,” Reid said.

In terms of EV supply management, the industry is going through some “EV-focused transitions,” he said.

“All of them for the most part are designing new distribution networks, independent of traditional distribution channels that they've utilized over the years, with the goal of maintaining lower inventories and adopting a build-to-order approach on the customer side,” Reid said.

Some of the biggest changes in consumer expectations during the vehicle sale and transportation process include visibility, with a more “end-customer focused support.”

Reid attributes this to the “Amazon effect,” especially in the EV industry. Many customers are going online to literally build their car from scratch before it even goes down the production line — and then having the vehicle delivered directly to their door.

The lead times of getting that vehicle may be longer, but the customer is getting “exactly what they want. Visibility, too — not only when it’s being produced, but also while it’s in transit, and ultimately on its way to their door,” Reid said.

“How that communication and how that network can support those customers’ changing needs, translates to all automakers in the industry — from traditional OEMs to the new entrants into the EV market — and that's what RPM is designed to support,” he said.

The industry is seeing more carriers and shippers interact directly with customers to communicate expectations and deliver the vehicle right to the person’s residence.

Reid called the process very dynamic in terms of service level agreements and the way commercial agreements are being made between carriers, non-asset-based providers (like RPM) and OEMs.

It’s about being a flexible service provider that can provide the visibility customers want — and really establish that trust between the auto manufacturer and its end customer — and execute on that delivery “flawlessly,” according to Reid.

Also discussed was how the EV supply management pipeline might differ from transportation for gas-powered vehicles.

First, the weight of the vehicle is probably the most obvious difference. EV vehicles weigh considerably more than gas-powered vehicles, which drives lower load factors for transportation. In other words, you can’t fit as many units on a trailer with EVs than you can with ICE vehicles.

Secondly, you can’t talk about EVs without talking about charging. Reid said that companies have to address charging concerns and have infrastructure in place to charge these vehicles — whether that's at vehicle origin or its destination.

The supplier landscape is also shifting. Reid noted that at the most recent Automotive Logistics Conference in Detroit, various speakers from the industry spoke to centralizing the supply base around U.S.-based manufacturing, meaning the adoption of more homegrown supplier-based networks.

With this approach, “they’re able to react to supply chain challenges quicker because of their regional footprint,” said Reid.

Consumer buying behaviors are also being closely tracked by the industry.

“The way that consumers are ultimately purchasing vehicles is drastically changing. From an obstacle standpoint from suppliers today, I think options on vehicles will probably become less, meaning there won't be as many different options or specifications on vehicles as there were previously,” Reid said.

This is due to the way the build-to-order model is shaking out, and because of challenges like the microchip shortage issue and obstacles in developing dual sourcing strategies with suppliers.

This strategy serves to “make sure you’re covered if a certain supplier can’t meet their obligation to have backup and contingency plans within your supply base to be able to react to unforeseen challenges,” Reid said.

There’s big competition to enter this new EV market, as traditional OEMs are aggressively pushing into the segment, and new OEMs that are primarily or fully electric are chomping at the bit, as well.

“There’s just competition right now to get their products to market, because obviously the demand for EVs looks to be high,” Reid said. “And that's also supported by government policy and sustainability and things of that nature that ultimately drive competition to get their products or these types of products to the marketplace,” Reid said.

RPM is not only a transportation provider, Reid said, but it is also developing solutions for inventory management and collaborating on network designs and system integration — especially important to the growing EV market.

“We feel the EV revolution is real and here to stay,” Reid said.

Updated to correct RPM Partners to RPM.