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Reconfiguring a Remanufacturing Line at Visteon, Mexico

Graduate School of Industrial Administration, Carnegie Mellon University, Pittsburgh, Pennsylvania 15213
College of Business, University of Cincinnati, Cincinnati, Ohio 45221
The Kenan-Flagler Business School, University of North Carolina, Chapel Hill, North Carolina 27599
A. B. Freeman School of Business, Tulane University, New Orleans, Louisiana 70118
sk0a{at}andrew.cmu.edu
uday.rao{at}uc.edu
msj{at}unc.edu
jzhang4{at}tulane.edu

Visteon's remanufacturing facility in Lamosa, Mexico was plagued with heavy fluctuations of supply and demand, leading to periods of severe capacity shortage. Management asked us to assess options for improving capacity. We developed a simulation-based line-configuration model that simultaneously considers line balancing and line length (number of production stations) to maximize the remanufacturing system's effective throughput. We computationally analyzed the effect of processing-time variability on line-reconfiguration decisions, the effect of correlated task-processing times on throughput, and the marginal benefits of using dynamic line balancing. Based on the data we collected, we made recommendations for reconfiguring Visteon's remanufacturing line. Management successfully implemented these changes, increased asset utilization, and reduced its planned new investments in capital equipment.

Key Words: Facilities: equipment planning; capacity expansion. Manufacturing: performance; productivity

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