May 9, 2019

Kion sees global trend toward digital transformation in logistics

Material handling systems vendor will invest in energy, automation, performance, innovation, and digitalization, CEO says.

By DC Velocity Staff

German material handling giant Kion Group AG today said it will continue its plan to adapt to the rise of "digitization" in global logistics by investing in innovation, automation, and energy efficiency in its catalog of lift trucks and supply chain solutions.

Following that "Kion 2027" strategy has helped the company record first quarter revenue of $2,339 million, up from $2,069 million for the first quarter of 2018, Kion said April 25. The company made a profit (EBIT) in that period of $205 million, up from $177 million a year earlier. Based on that success, Kion will now issue a stock dividend of $1.35 per share, an increase of 21 percent compared with the previous year, Kion CEO Gordon Riske said at the company's annual general meeting in Frankfurt today.

The company says its strategy will help it benefit from global mega-trends like the growing tendency of consumers to buy online (e-commerce) and the increasingly fragmented value chains of the global economy, according to Riske. Those trends are creating a rising demand for "integrated intralogistics solutions," which Kion expects to meet by having its operating segments work more closely together, he said.

"In the years ahead, digital transformation will be the crucial distinguishing factor for many industries and businesses," Riske said in a statement. "It will also massively change logistics. Innovative supply chains will become key competitive advantages in the modern internet economy. Goods are being moved around at an ever-faster pace and in a much more complex way than ever before. To keep step with it, we need to offer flexible and highly automated logistics and intralogistics solutions. We are looking to play a big part in this."

That message continues Kion's direction in recent months, as the company has announced its digitization strategy and hired executives to lead the initiative. In the coming years, Riske said Kion will continue in the same direction, focusing its development projects on five fields: energy, automation, performance, innovation and digitalization.

Toward that end, Kion will invest in 2019 in expanding its production capacity by expanding existing plants in Aschaffenburg, Hamburg, Châtellerault (France) and Luzzara (Italy), and building new factories in Poland, India, and China.

Other investments will include an increase in its digitalization efforts, which have recently seen the launch of software solutions such as Dematic iQ Virtual and Dematic iQ InSights as well as the new Kion Cloud. The company also announced a creative innovation lab called the Kion Digital Campus, charged with developing new solutions such as apps for service technicians and data-driven fleet optimization for customers. That lab will soon be joined by the Kion Digital Academy, a forum for providing digital training to the company's workforce.

Automation was another area of recent investment, as Kion developed the "PackMyRide" automated solution for last-mile logistics tasks of loading packages into delivery vans. The company also opened a Robotics Center of Excellence in the US, and produced a robotics piece-picking module that is designed to accelerate warehouse work with a software-controlled robot arm for gripping objects.

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