Figure 2: Industrial robots performing spot-welding operations in a respot line.

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1 Automobile Final Assembly Plants Introduction: Demand for the automobile and the development of production technology to meet this demand have been responsible for much of the economic growth in many countries in the world throughout the 20th century. Over the years, there have been significant innovations in the design and operation of automobile assembly lines. One of the recent innovations is the use of in-line sequencing (ILS) which was first adopted by Chrysler. What inline sequencing means, is that the sequence of cars is maintained from their initial launching onto the beginning of the line until they are driven off at the end of the line. To appreciate the significance of ILS, one must understand how a typical final assembly plant in the automobile industry operates. Organization of work in an automobile final assembly plant: Nearly all automobile final assembly plants are divided into three areas: (1) body shop, (2) paint shop, and (3) trimchassis-final. The flow of work through these three areas is depicted in the diagram of Figure 1. The three areas may all be contained within one building (as the figure illustrates), but sometimes the paint shop is separated from the others because of the processing and ventilation problems associated with spray-painting technology. Figure 1: Diagram depicting the three sections of an automobile final assembly plant. In the body shop, the sheetmetal body components are assembled by spot welding. Roughly 1000 individual spotwelds are made on a typical car body. To begin the process, the individual sheetmetal parts, consisting of the floorpans and side panels (called apertures because of the door openings), are loosely -fastened together by human workers. This is called "body tabbing" because the fastening is accomplished by bending metal tabs on the sheetmetal parts. Each car body is then fed through a fixturing-and-welding system called the Robogate. The Robogate system clamps the partial car body together into the properly aligned shape and applies a number of spot welds to fix the subassembly into this alignment. This system is called the Robogate because the spot-welding operations are performed by robots. From the Robogate the car bodies are transferred through a series of robotic stations which accomplish additional spot-welds. This part of the assembly line is called the respot line. Figure 2 shows an example respot line. Figure 2: Industrial robots performing spot-welding operations in a respot line. 1

2 At subsequent stations in the body shop, the roof, hood, and other sheetmetal parts are added and spotwelded in place to complete the car body. To fix any defects, scratches, and rough spots, the bodies then move through a repair section of the line where workers grind and wire-brush the defects out and smooth the sheetmetal surfaces. After the sheetmetal body is completed, it then moves to the paint shop. In the paint shop, a series of processing steps are performed to prepare and coat the car body surfaces. These steps include: phosphate, uniprime, base coat, and clear coat. The phosphate process chemically cleans the surface and prepares it to accept the painting coat. The uniprime is a priming operation that adds the first coat of paint. Base coating is the coat that provides the color to the automobile car body. Finally, a clear coat is applied for protection and shine. The painted car bodies then move to the trim-chassis-final section of the plant. In this section, the seats, dashboard, windows, and other trim are added. Radios and options such as air conditioning are also added here. Near the end of the trim-chassis-final area, the engine, transmission, and tires are mounted into the car. When all of the trim and chassis work has been completed, the cars are usually ready to be driven off the line. Quality problems are repaired and final adjustments are made on the completed automobile at this point in a procedure sometimes called "reprocess." Labor hours: It takes about 20 hours of direct labor in a final assembly plant to complete one automobile. The division of labor hours between the three sections of the plant is roughly: Body shop 4 hours 20% Paint shop 3 hours 15% Trim-chassis-final 12 hours 60% Reprocess 1 hour 5% Subtotal 20 hours 100% It is obvious that the bulk of the direct labor is in the trim-chassis-final area. The figures above are representative of a plant that is highly automated in the body shop and paint shop. Robots are used in the body shop to perform the spot-welding operations. In the paint shop, robots are also used, but much of the processing involves the use of mechanized material handling through dipping tanks and heated drying chambers. For these reasons, the body shop and paint shop have relatively low labor contents. It is in the trim-chassis-final section of the plant that the work is labor-intensive. These assembly operations are difficult to automate. Maneuvering the back seats into position, or attaching the dashboard assembly in place, for example, are difficult procedures for a robot to perform. These operations require a certain ''sense of touch and other skills that only humans possess. In addition to direct labor hours, there are also indirect and overhead hours for the plant. The indirect category includes the foremen and supervisors, maintenance and repair personnel, material handling, and other support people. Overhead includes plant management and professional personnel (engineering, accounting, etc.). These hours, allocated on a per car basis, are approximately: Indirect Overhead Subtotal 7 hours 3 hours hours There are, of course, variations in these time values from car to car because of differences in models and options. For a plant that produces several different models, some models will require a larger total direct labor time. For example, the plant may produce two-door and four-door sedans and station wagons. The four-door models will usually require more time than the two-door models. Options have a significant effect on total direct labor time. Cars loaded with options (e.g., special radio, air conditioning, two-tone paint, moonroof, etc.) take significantly longer to assemble than cars equipped with the standard equipment. In addition, some final assembly plants are not as mechanized and automated as others. Older plants tend to have less automation, and therefore use more labor to assemble the cars. These plants will tend to have more direct labor hours per automobile. 2

3 The number of workstations in a final assembly plant: Automobile final assembly plants typically produce cars at the rate of approximately one car per minute (60 cars per hour). The direct labor hours indicated above are allocated amongst workstations located along the line of flow of the cars moving through the factory. With a production rate of one car per minute, this means that the work accomplished at each station must be completed in one minute or less (This cycle time of the line is the reciprocal of the production rate). Considering that 20 hours (1200 minutes) of time go into the average car, this translates into 1200 stations each performing one minute of work. However, the actual number of workstations in the plant is substantially greater than 1200 for the following reasons: 1. It is impossible to allocate exactly one minute of work to each station, because of variations in work element times at the different stations. Some stations have less work to do than others. Hence, more than 1200 stations will be required because of this imperfect "line balance". 2. Different automobile models require different total times. The line must be designed for the model that takes the longest time. This adds to the number of workstations on the line. Other models will have idle time at some of the stations. 3. Extra workstations must be provided to add the options. These stations will have no work to perform on those cars that do not require the options. 4. Some workstations are automated using industrial robots and other automated machines. These stations do not add direct labor hours to the car, but they add to the number of workstations on the line. The automated stations are more numerous in the body shop and the paint shop than in trimchassis-final. For these reasons, the actual number of workstations in the plant will total around 2100 rather than To move through these 2100 stations in the different sections of the plant, each vehicle will follow a route (partially or totally conveyorised) that is several miles long. It is estimated, for example, that the conveyor path in an automobile assembly plant is approximately 10 miles long. Figure 3 illustrates the layout of a plant where the line of flow of the vehicles is all conveyorised. In this plant, it takes about 24 hours (of plant operating time) for a vehicle to travel from the beginning of the line to the very end. Figure 3: Layout of a final assembly plant 3

4 Problems in managing an automobile assembly plant: Organizing and managing a final assembly plant is a monumental operation. The automobile industry attempts to cater to the desires of its customers by offering a variety of models, colors, engines, and options, all of which add to the complexity of scheduling and coordinating the work in the plant. For most plants, there are so many possible permutations of colors and options in an automobile, that it would be theoretically possible to produce cars at the rate of 60 units/hour for eight hours/day for several hundred years without producing the same exact car twice. The complexity and variety inherent in the modern automobile present a significant challenge to production management. The principal problems which confront the managers of the final assembly plant are: 1. Scheduling of production to provide a supply of cars that matches customer orders. Customers include both the individual consumers who order cars to be custom-made to their specifications, and dealers who order cars to be sold from their stocks. It is important for the plant to engage itself in the production of cars that these customers want. 2. Managing the acquisition of raw materials and-components used in the plant. A typical automobile consists of approximately 4000 separate components, most of which are purchased from independent suppliers. It may take only 24 hours for the car to flow through the final assembly plant, but the materials and components that go into it must be ordered from the suppliers far in advance to have them available when they are needed for assembly. 3. Quality defects in the unpainted body or after painting. To deal with these quality problems, major repair areas are incorporated into the line. These repair areas hold the cars until workers can make the necessary repairs. They are located predominantly in the body and paint shops. 4. Malfunctions and breakdowns of certain sections of the line. These problems occur mainly with the mechanized and automated equipment on the line. Welding robots, material handling systems, spray-painting equipment are usually the sources of these difficulties. Unless some provision is made to deal with equipment failures, a breakdown in one section of the line can stop production in adjacent sections of the line. The upstream section of the line is said to be "blocked" because it cannot send parts to the broken-down section. And the downstream section is said to be "starved" because it cannot receive parts from the broken-down section. 5. Balancing the assembly line to achieve the most even possible allocation of work among the individual stations. If many models requiring more than the average work (in terms of direct labor hours) are launched onto the line one right after the next, then the stations will not be able to keep up with the work. On the other hand, if a large number of models requiring less than the average work are launched together, then the stations will be underutilized and inefficent. Line balancing in a mixed model situation requires that models needing more work must be intermixed with those needing less work in order to avoid overworked or underworked stations. 6. Absent workers and workers missing from the line at the startup of production on a given shift must be replaced by substitute workers. It is difficult to predict how many workers, out of approximately 1700 manned stations, will be absent on a given day. Failure to replace a missing worker at any station means that no work will flow through that station, thus creating a bottleneck that will stop production at the plant. 7. Out-of-stock condition on parts needed in assembly. 8. Components needed at a given station must be present when the vehicle on which they are to be assembled gets to that station. Failure to satisfy this requirement means that the vehicle will pass through the station without the required work. This work must ultimately be done, probably in reprocessing at the end of the trim-chassis-final section. If the problem occurs on many cars during a shift, a bottleneck occurs in reprocessing. The problem is complicated by color differences among the vehicles. For example, seats may be present at the seat insertion station, but if their color is not compatible with the body paint, they cannot be added. Inventory banks their use and misuse: To cope with these problems, automobile final assembly plants make use of inventory banks. Inventory banks are temporary storage locations along the line where partially completed vehicles are kept. The banks are typically placed between and within the three areas in the plant (body, paint, and trim). Provisions for space in the plant must be made to hold the anticipated numbers of cars in each inventory bank. The space allocated to this form of temporary storage can be substantial. The inventory banks in the plant cause the assembly line layout to be divided into sections which are separated by storage areas to hold the work in-process. This arrangement is depicted in the diagram of Figure 4. Each section operates somewhat independently of the others, but with the requirement that it must maintain the overall production rate of the plant. 4

5 Figure 4: The automobile assembly line divided into segments by inventory banks. The inventory banks can be arranged in a number of different ways. They sometimes consist simply of large open floor areas in which the car bodies are carried on 4-wheeled carts that can be pushed by the workers. In these cases, the cars do not necessarily leave the bank in the same order in which they entered. In other cases, the cars are moved by asynchronous conveyors which can start and stop automatically and whose movement is controlled by the demand for work at the downstream stations. When these conveyors are used in inventory banks, they consist of stretches of conveyor track along which there are no workstations and no work is performed on the cars. If the conveyor is laid out as a single track, the sequence of vehicles is maintained in the inventory bank. That is, the vehicles leave in the same order that they entered. If the conveyor uses several parallel tracks to achieve a more compact storage space, it is possible to lose the sequence, unless the conveyor system is managed closely. Inventory banks provide the automobile assembly plant with a way around many of the problems described above. The following are the uses of inventory banks in a final assembly plant. Many of these uses are considered to be practical and beneficial: 1. Inventory banks can be designed as storage buffers between automated sections of the plant, so that if one section breaks down, the upstream and downstream sections of the line can continue to operate. The upstream section will not be blacked, because there will be empty spaces in the buffer to receive cars that have been completed. The downstream section will not be starved, because there will be cars in the buffer to supply it. 2. Inventory banks allow for variations in the workstation times. If a certain station or section of the line gets behind in its work, the inventory banks ahead and behind that section prevent the adjacent sections from being affected. In other words, they serve a function that is similar to the buffers described above. 3. Inventory banks can be designed as delay loops in sections of the plant where there are differences in processing, resulting in some cars needing longer processing times. The delay loop provides a temporary dwell of the cars taking less time to process, so that they can be merged back into the same original sequence with the cars needing e>stra processing. An example of a delay loop occurs when cars receive a two-color paint coat. Two-color cars require a second pass through the painting booth which effectively doubles their required painting time. Cars not receiving the twocolor coat are placed in the delay loop so that they can be sequenced into the original planned order with the two-color cars. 4. Inventory banks can be used for temporary storage of defective cars that are partially assembled. The vehicles are stored, sometimes for hours or even days, until workers can be provided to make repairs. 5. Inventory banks can be designed as flow-through repair areas, to permit minor defects to be fixed. These defects are common in body and paint. The times to make the repairs vary, and so the banks help to smooth out these repair time variations that would otherwise affect line performance. 6. Inventory banks can be used as quality control inspection areas, where partially completed cars can be pulled off the line to perform dimensional measurements and other inspections. Normally these inspection areas are not referred to as inventory banks, since their purpose is different from the usual inventory functions. 7. Inventory banks can be used to overcome a temporary out-of-stock condition at a station. The cars are temporarily placed in the inventory bank until the missing parts arrive. 5

6 8. Inventory banks can serve as hedges against discrepancies between actual production and the production schedule. If two many of one body style have been framed relative to the production schedule, these cars can be stored in the appropriate inventory bank and then drawn from the bank as indicated by the schedule to proceed to the next stage of production. 9. Inventory banks sometimes serve a dual function of transport and storage. Conveyor systems, usually overhead conveyors, are used in automobile plants to move the cars between major sections of the plant (e.g., between the body shop and the paint shop, or between paint and trimchassis-final). Because the distances between these areas of the plant are often significant, a large in-process inventory builds up in these conveyors. Thus, the conveyors are providing a storage function as well as a transport function. As appropriate as these uses seem to be, there are certain disadvantages or potential disadvantages associated with the use of inventory banks in an automobile plant. There are also instances where the inventory banks are not used appropriately. It is germane to this case study to examine these disadvantages and misuses. First, work-in-process represents an investment cost. The corporation has significant capital tied up in inventory. If the number of cars in the inventory banks grows, the invested capital grows. For example, if a plant has an average of 500 cars located in inventory banks throughout the plant, and the average value of each partially completed car is $3000, that represents a total investment of $1.5 million in work-in-process. If this investment is paid for with borrowed money, at say 20%, the annual interest cost of this work-in-process is $300,000. If the inventory could be reduced from 500 to 250 cars, this would represent a one-time investment savings of $750,000 and an annual interest cost savings of $150,000. Second, inventory banks tend to hide quality problems. A worker can keep a defective car body in storage indefinitely, preferring to take from the inventory bank those cars that are good quality. Dealing with the quality problem can be postponed. Third, inventory banks allow cars to get out of sequence. The order in which cars enter the inventory bank is not necessarily the order in which they leave. This loss of sequence results in a number of problems on the line, including loss of line balance, and components not being in the proper sequence at a given station to add to the present car at the station. For example, if a production problem develops for one of the body styles (e.g., out-of-stock of one of the major components needed to assemble it), the other bodies can be made exclusively until the problem is solved. This sounds like an advantage in the form of greater flexibility in operating the line, but it leads to difficulties in balancing the workload on the line and a loss of production of the car style with the problem. Fourth, inventory banks tend to grow in size to be much larger than originally intended. The units in the bank are supposed to serve the -function of smoothing production against technical, scheduling, and quality problems. However, the attitude begins to prevail in the plant that the more units there are in the banks, the more protection there will be against these problems. In addition, units that are especially troublesome stay in the inventory banks -far longer than they should. Because the troublesome units can be placed in the bank, there is a tendency -for the line personnel to neglect the problems. Therefore, the number of units residing in the plant as work-in-process tends to increase over time. Many of the preceding disadvantages and misuses associate with inventory banks might be described as constituting a lack of discipline in managing and operating the line. This lack o-f discipline results in violations o-f the production schedule, loss o-f line balance, and avoidance o-f quality problems rather than solving them and preventing future defects. In-line sequencing in an automobile final assembly plant: In-line sequencing (ILS) is a policy for managing the final assembly plant in which the automobiles are produced off the end o-f the assembly line in the same sequence as they were launched onto the front of the line. It is an alternative to the traditional way of managing an automobile assembly line - an alternative which avoids the heavy reliance on inventory banks to deal with production problems. The use of inventory banks tends to conceal these problems, whereas in-line sequencing forces the production personnel to confront and solve the problems. The most obvious distinction between ILS and the traditional assembly plant management policy is the strict ILS discipline of maintaining the order in which cars are processed during their movement through the plant. The first-in-first-out (FIFO) rule is followed at each step of assembly. As long as this FIFO regimen is followed at each step, the cars roll off the end of the line in the same sequence as they started. This contrasts with the use of inventory banks in the conventional plant, which permits the sequence of cars to be lost to some extent. Inventory banks can allow the cars to become out of sequence because they can 6

7 exit the storage area in an order different than first-in-first-out. ILS includes integrated in-line conveyorized movement of vehicles throughout the plant which minimizes the possibility for cars to get out of sequence. In-line sequencing requires more than just a first-in-first-out discipline on the assembly line. It forces a much stricter discipline in many other areas of plant operation. Following is a list of changes in the management of the assembly plant that must occur to make ILS work properly. Indeed, some of these changes affect the operation of the entire corporation, not just the assembly plant. 1. Strict adherence to the production schedule. Alterations and exceptions to the production schedule cannot be tolerated if the in-line sequencing discipline is to be maintained. These alterations and exceptions cause the sequence of cars on the line to be lost, resulting in poor balancing of the line, to-be-added components out o-f sequence relative to the car when it arrives at the workstation, etc. 2. Better equipment maintenance. Reliability of mechanized and automated equipment becomes more critical with ILS. Without the reliance on buffer zones along the line, equipment Failures cannot be tolerated or else adjacent sections of the line will be forced down. Preventive maintenance (PM) becomes extremely important to minimize the -frequency and duration of downtime. 3. Better line balancing because the models requiring more time to assemble can be mixed with those requiring less time. This provides a steadier workload at each of the assembly stations. 4. Greater capability to solve quality problems. ILS requires a higher "-first-time-capability" or FTC which means simply getting it right the -first time. Painting is the weak link in following ILS, because of the difficulty in fine-tuning this technology to achieve 100% good quality on every unit of product.. When the painting operations are performing poorly, in-line sequencing is sometimes temporarily lost. The conveyor flow line in the paint shop is designed to accommodate a certain level of rework, to correct defects in the coated surface. This is done by separating the line into two paths: a repair loop and a delay loop. The cars that have been identified as defective are shunted onto the repair loop, while the good cars are sent to the delay loop. The two loops join back together downstream and maintain the same original sequence. However, when there are two many defects in paint, the repair loop cannot keep up with the timing of the delay loop, and in-line sequence is lost. 5. Minimizing the permutations of product. This affects the product design and marketing, traditionally considered to be sacred territory, beyond the reach of manufacturing to influence. For example, reducing the available colors of cars results in a reduction in the number of changeovers required in the paint booth. Each change in paint color requires purging of the spray nozzle and lost time. It is estimated that this changeover costs about $10 to $15 every time the color is changed from one car to the next. In addition, the variability in body color expands through other components that must match. 6. Doing a better job of design for producibility to minimize problems and costs in production. There are some dramatic examples of the benefits of design for producibility. In one case, an automobile console clock-and-light assembly was redesigned to simplify the assembly for the 1987 model. The previous unit consisted of 22 components with wires and mechanical fasteners. The clock was redesigned to reduce the number of components and make it easier to assembly. The final result was a clock with only six components, no wires, and no mechanical fasteners. The assembly of the unit has been automated with an 83% savings in labor costs and a 39% savings in material cost. 7. Better coordination with suppliers to use a just-in-time (JIT) delivery schedule so that components will arrive at the workstation along the assembly line in the order in which they are assembled on cars coming arriving at the station. This would be virtually impossible without maintaining the inline sequence. 8. Purchase modules rather than individual components from suppliers. This reduces the labor requirements at the final assembly plant. It also reduces the technical staff required to support the particular module. 9. Reduction in the number of different suppliers and establishing closer relationships with the remaining suppliers. The traditional purchasing policies in corporations included competitive bidding, buy from the low-cost vendor without regard to quality, and use multiple suppliers for each item. Today, many companies are attempting to establish closer relationships with fewer suppliers that are based on quality as well as price. Many of these changes have resulted in the adoption of a supplier delivery schedule" (SDS) which has a rolling 10-day gateline. This simply means that the delivery schedule which they must satisfy is fixed 10 days in advance of final thus allowing them to plan their own production without fear of last minute changes, rush jobs, and with other customers. Each day, the schedule adds one day on the end of the delivery schedule to take the place of the actual deliveries that have been made on the present day. 7