Automotive Inventory Delivery Location Optimization
Name
odonnell-seano-mba-mgt-2022-thesis.pdf
Description
Thesis PDF
Size
932.01 KB
Format
Adobe PDF
Checksum (MD5)
8bec24082b47027f36150cbe403f6ec4
Author(s)
O'Donnell, Sean
Advisor(s)
Anthony, Brian
Willems, Sean
Date Issued
May 2022
Publisher
Massachusetts Institute of Technology
Abstract
Automotive supply chains are large, complex networks that are frequently looked at for cost reduction opportunities. While research shows many ways to optimize routing and quantities of inventory to save money, it tends to be for systems where locations are distant. This thesis identifies opportunities for cost reduction in systems where there are multiple nearby delivery locations for any part, such as an automotive vehicle assembly plant with a warehouse within a few miles distance. A mixed integer linear optimization model was used on data from Nissan’s Smyrna, TN assembly plant. This model takes advantage of warehouse management cost variability for each part. By optimizing the delivery location for every part to be the warehouse or the factory, annual warehouse management cost savings of greater than 20% are possible. This result is discussed further as well as ways to successfully implement this type of model at different factories.
MIT Department
Massachusetts Institute of Technology. Department of Mechanical Engineering
Sloan School of Management
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