Reduce Transportation Costs Using the Milk-run System and Dynamo Stages in the Vehicle Manufacturing Industry

Abstract

The vehicle manufacturing industry is one of the automotive industries in Indonesia that produces four-wheeled vehicles with the main product being cars. The vehicle manufacturing industry has several sub-companies including Vehicle Manufacturers (VM) and Vehicle Sales (VS). The VM industry is experiencing problems with rising transportation operating costs. The same thing is also experienced by the corporate company such as VS. In 2020, transportation operational costs incurred by the company exceed the target, which can cause losses for the company. The purpose of this study is to find the cause of the problem and improve the transportation operational costs that continue to increase so that the company gets a reduction in transportation costs. The implementation of the improvement concept is carried out using the Dynamo++ stages starting from pre-study until the implementation of improvements. Through improvements to the milk-run system, it was found that vehicle manufacturers and vehicle sales benefited from a reduction in transportation costs of 77,861 USD or a decrease of 79.3%.