Continuous Improvement for Cost Savings in the Automotive Industry

Abstract

Today’s manufacturing environment is characterized by rising production costs. Automotive companies are faced with a challenge of meeting the ever-changing customer needs at the minimum possible cost. Reducing the production costs is of paramount importance for a company to remain competitive in a turbulent environment. How can companies in the automotive industry increase cost savings? This paper focuses on continuous improvement for cost savings in the automotive industry. This was conducted at an automotive production line using the work-study technique. Time and method studies were conducted on the production line of one of the products. This was done under these objectives: to identify excess raw material input and non-value adding activities in the product line, to determine current factory capacity, to determine factory capacity utilization, and to implement improvements on the product line so as to increase productivity. The daily target at the company was eight complete units per shift, and the research explored the potentials of increasing that daily target with little to no increase in the number of operators and workstations. The results demonstrate an increase in productivity by 50% by adding one more workstation and one more operator at the surface finishing station. This was successfully implemented and the company is now producing 12 units per shift.