Development of a cost model and its application in determining optimal size of a diesel engine remanufacturing facility

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Remanufacturing represents a business opportunity and a means to promote environmental sustainability. In planning remanufacturing operations for a specific product in a particular market, determining the facility size is a critical decision. A large centralized facility offers economies of scale advantages, but has greater transportation costs relative to a set of smaller distributed facilities. A remanufacturing facility cost model is developed and applied for diesel engine remanufacturing that includes product, operation, inventory, and transportation-related costs. The effects of product yield, remanufacturing efficiency, transportation cost rate, and product mass on remanufactured product unit cost and remanufacturing facility size are examined. © 2010 CIRP.

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CIRP Annals - Manufacturing Technology