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Hy-Vee Fuel Efficiency

Hy-Vee Fuel Efficiency. Employee Owned Company Founded in 1930 Corporate Office – West Des Moines $7.2 Billion in Sales Last Year 235 Stores Over 60,000 Employees. Chariton. Hy-Vee Distribution Centers Chariton, Iowa Cherokee, Iowa Subsidiary Distribution

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Hy-Vee Fuel Efficiency

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  1. Hy-Vee Fuel Efficiency

  2. Employee Owned Company • Founded in 1930 • Corporate Office – West Des Moines • $7.2 Billion in Sales Last Year • 235 Stores • Over 60,000 Employees Chariton • Hy-Vee Distribution Centers • Chariton, Iowa • Cherokee, Iowa • Subsidiary Distribution • Perishable Distributors of Iowa • Lomar Foods • Florist Distributing, Inc.

  3. Hy-Vee Sales History

  4. Approximately 250,000 Square Mile Trade Territory

  5. Hy-Vee - Transportation

  6. Asset Allocation Tractors Trailers Total Acquisition Cost: $60,000,000

  7. Miles Driven Equivalent to 1,248 trips around the world every year.

  8. Transportation - 2011

  9. Effect of Fuel Cost on Truck Expense

  10. Effect of Fuel Cost on Truck Expense

  11. Truck Expenses 9.2 Million 3.7 Million 26.7 Million 3.1 Million 6.1 Million 18.2 Million

  12. Fuel Economy

  13. Projected SavingsFuel Economy over 6.4 mpg

  14. Technology • Tractor/Trailer Aerodynamics • Tires – Super Singles & Fuel Efficient Duals • Onboard Computers – People.net • Fuel – Biodiesel & Propane • Load Planning – Retalix Transportation Optimization (RTO) • Dispatch Visibility – CAMS • Tractor Specification

  15. Aerodynamics

  16. Trailer Aerodynamics

  17. SUPER SINGLE TIRES • Began in 2005 with 5 tractors & 5 trailers (40 tires); expanded to additional units • Test results with super singles on tractor & trailer showed 0.12 to 0.32 mpg improvement in fuel economy • Fuel economy shown with super singles was wiped out by reduced tire wear & driver satisfaction • Currently phasing out super single tires & have gone to a fuel-efficient dual tire

  18. Fuel-Efficient Duals

  19. PeopleNet Onboard Computers

  20. PeopleNet Reports • Records MPG • By Driver • By Tractor • Records Idle Time • Driver Speeds • Driver Activity Reports • Bread Crumb Trail • Fuel Tax

  21. Fuel – Soy Biodiesel • 18 month test • 5% blend • Adds lubricity to the engine to offset the ultra-low sulfur diesel • 183,000 gallons purchased • No impact on fuel economy • Cleaner fuel system • Cost Prohibitive – Adding Soy Biodiesel increased fuel cost by $0.09 per gallon

  22. Benefits of Fuel – Propane Mixture • Reducing fuel cost & increasing fuel economy • Improved engine horsepower • Receive approximately 75 HP boost with propane • Extended service intervals • Use of propane reduces particulates caught in the particulate trap • Oil soot samples have been reduced • Reduced greenhouse gas emissions • Warranty is still valid

  23. Propane Diesel Injection System • A small amount of propane is mixed with the air intake prior to the introduction of the air to the engine (20% propane & 80% diesel).

  24. Propane Diesel Injection System Why it is so beneficial….The small amount of propane increases the combustion efficiency of the diesel burn producing more mpg and less emissions and enhanced performance.

  25. Retalix Transportation Optimization - RTO • Routing Software was installed in 2010 • Interfaced with our Warehouse Management System & Electronic Dispatch • Provides Dynamic Routing

  26. CAMS Dispatch Software • Allows visibility between Distribution Centers • Interfaces with our warehouse management system, routing software, & onboard technology (PeopleNet) • Streamline payroll • Dispatch loads to drivers • Reporting & analyzing equipment usage • Tracks backhauls • Manages drivers time off • Track average delivery weight & cube by store

  27. New Tractor Technology • 2011/2012 Volvo Tractor • 2010 EPA emission standards • Aerodynamic body style • I-Shift automatic transmission • Disk breaks reduce stopping distance • Have purchased 60 over the last two years • Averaging 6.8 mpg as a group • Most popular tractors we have purchased

  28. Increase Freight Capacity • Maximize Outbound Weight & Cube • 81,140 Loads • Contract Freight • 4,380 Loads • Backhaul Freight • 38,069 Backhauled • Direct Store Deliveries • Included in backhaul freight

  29. Contract Freight - Hormel • Partnered with Hormel • in 2004 • Hy-Vee’s private fleet • delivers to Hy-Vee • stores in a 7 state area • Hormel has several • plants in this 7 state • area • Currently pick-up 2,400 loads per year Chariton & Cherokee DC’s • Stores Plants

  30. Backhauls Backhaul over 50% of our loads Reduce empty miles Deliver to subsidiaries Major Suppliers: Kraft Premium Water American Bottling Kimberly Clark Quaker Hormel General Mills Unilever Nestle

  31. Direct Store Deliveries – DSD’s • 8.4% of backhauls are DSD’s • Allows stores to make better deals with vendors • Kraft • Premium Water • American Bottling • Kimberly Clark • Quaker • Hy-Vee Lawn & Garden

  32. Questions?

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