Cardinal Logistics is investing more than $450 million in developing the country’s first fully automated third-party logistics (3PL) warehouse in Drury, South Auckland.
Cardinal, the country’s largest privately-owned 3PL company, expects the first stage of the project to be online later this year.
Also believed to be largest of its type in the Southern Hemisphere, the new facility represents a massive capital investment in New Zealand’s supply chain infrastructure.
The project is broken down into three stages and will feature a central distribution hub filled with high-speed pallet cranes and rapid sorting vehicles, with 115,000 automatic storage and retrieval system (ASRS) pallet capacity in Auckland when fully complete by June 2025.
The first stage to be completed this year will deliver 12,000 ASRS pallets, stage two is due for completion in December 2024 with a further 48,000 ASRS pallets and stage three in June 2025 with the last 55,000 ASRS pallets. An additional similar 45,000 automated pallet Christchurch site is also under design.
The facility is set to improve order processing times by up to 400% with the investment part of a wider multi-billion industrial development in Drury.
An integrated buffering system with capacity to handle 62,000 cartons provides for automated carton picking on a massive scale. Automated technology will move products to pallets and into trucks at high speed. This will all be housed in a six hectare building with a 25-metre ceiling height – one of the tallest warehouses in New Zealand to allow room for the robotics.
When operational, an order will be placed into the automated system, robotic cranes will retrieve specific cartons from their location and will, based on their weight, deliver them in the right order to the correct pallet, to be packed and then dispatched. How delivery trucks are packed will be determined by the AIsystem and will be based on the best route to reach each customer.
While speed is important, Cardinal says the core focus of the development is to improve productivity and customer service delivery, lower costs and reduce waste.
Its innovative automation technology will enable the smoothing of peaks in demand, meaning an optimised and lower-cost supply-chain for Cardinal partners and for end-consumers, the company says.
The investment comes at a time when national supply chain infrastructure struggles with peak volumes.
Cardinal chief executive Brendon Furness says Covid-19 and recent extreme weather events like Cyclone Gabrielle have highlighted the critical importance of New Zealand having more resilient infrastructure.
“This investment is the first of its kind for New Zealand’s highly competitive logistics industry and will provide more resilience and efficiency at the customer end of supply-chains.
“We think technology and innovation can transform the future of New Zealand supply-chains. Large scale infrastructure investments in automation like this will help flatten out the surges of volume that can occur when another part of the supply chain is constrained.
“Combine that with more collaborative use of data analytics and AI in areas like demand planning and forecasting, and we expect to see much better and faster logistics decision-making, which will ultimately benefit consumers.
“Automation and robotics in warehouses are now proven technologies in other markets, however this is the first investment of this scale in automated logistics technology here in New Zealand, and we think the new facility will revolutionise carton warehousing.
“It will also drive sustainability and waste minimisation, with the use of innovative technology that will have the use of plastic shrink-wrap, and with smarter transport and warehouse utilisation that reduces emissions,” Furness says.
The warehouse will also feature solar roof panels, capable of generating 1.4 megawatts, enough to power around 220 homes.
Furness says the long-term strategic investment is supported by rising market demand, increasing supply chain costs, and the emergence of new automation technologies.
“These technologies will also reshape how we invest in our people to operate and maintain what we believe will be the fastest and most accurate pallet management and carton picking system in the country,” he says.
To carry out the project, Cardinal has partnered with world-leading automated material handling solutions provider Daifuku.
Daifuku will provide all the high-tech machinery and infrastructure to run the warehouse along with a shuttle system capable of moving individual cartons through the warehouse at nearly 200 metres a minute.
The move towards automation is not the first for Cardinal. In 2022, the company pioneered the ‘Perfect Pallet’ program. Using smart technology to weigh products onto pallets and track their accuracy through the delivery process, Cardinal can load multiple customer products on the same pallet.
“Our automated warehouses will extend the Perfect Pallet program across a greater number of customers,” Furness says.
“This means faster delivery, smarter demand planning, greater accuracy, and minimal product damage for our customers, which in turn leads to consumers being more readily able to find the products they want to buy on store shelves.
“The benefits also extend to the development of new skills for logistics workers. We have some of the best warehouse people in the country, and these technologies will enable new skill development opportunities and career paths at the new facility in Drury.
“Given this site integrates into our Auckland warehouse network, it will also help smooth the spikes and surge volumes that occur in our industry which typically result in stress and heightened health and safety exposure.
“It is an incredibly exciting future for our partners, who will benefit from a faster and more efficient supply chain and be able to deliver better outcomes for their end customers,” Furness says.
