CNH’s master depot in Lebanon, Indiana, serves as a central hub for spare parts, stocking components for both new and older machinery across its brands. As its inventory grew, space became a challenge, prompting the company’s planning and process engineers to find a solution.
Jason Kimmerling, Manager Warehouse Processes, leads a team dedicated to enhancing CNH’s North American depot network, which includes six U.S. depots, a packaging center, and two facilities in Canada. Their focus extends beyond digitalization and automation to improving warehouse efficiency, optimizing layouts, and ensuring employee well-being.
“Jason and his team are really innovative in their approach to continuous improvement,” says Melissa Blinderman, director of CNH’s parts distribution operations in North America. “It’s not only about efficiency and profitability. They look at what can improve the health and safety of our teams; the quality of service we deliver; and the sustainability of our operations.”
To address space constraints, Kimmerling’s team pursued automation. However, integrating automated retrieval in a 24/7 operation with no downtime posed significant challenges.
The Lebanon depot spans 78,000 square meters (842,000 square feet) indoors, with another 47,000 square meters (500,000 square feet) of outdoor storage, holding 350,000 different parts, from small bolts to large tractor cabs.
The team selected AutoStore, a Norwegian automation provider, to implement a high-density, 3D grid storage system. The bins, which store parts of varying sizes, are accessed by automated carts that retrieve them efficiently.
Implementing the system required extensive planning. The team categorized parts by size, weight, and sales frequency, ran simulations, and ensured seamless integration with existing warehouse and customer service systems.
The pilot program, launched in January 2022, covered 930 square meters (10,000 square feet) and processed 20% of warehouse orders, significantly improving retrieval speed.
Now, the depot is expanding the automated system five-fold, adding nearly 100,000 bins and relocating 36,000 parts. The upgrade, set for completion in April 2025, is expected to generate substantial cost savings.
Additionally, CNH introduced an industry-first automated packaging system, OPERA, which scans items and custom-builds boxes, processing 650 packages per hour—equivalent to a full day’s manual work. This innovation enhances productivity, reduces waste, and supports sustainability.
Encouraged by Lebanon’s success, CNH is implementing automation in its new Toronto warehouse, where 85% of storage will be automated. Kimmerling’s team is also guiding European facilities in adopting similar technology.
“We are constantly looking for new opportunities to improve our cost base, improve our customers' experiences and implement new technologies that are right for us,” Kimmerling said.