General Motors Factory Relocation Program - PowerPoint PPT Presentation

General motors factory relocation program l.jpg
Download
1 / 16

General Motors Factory Relocation Program By Yudi Jin JP Park Company Overview Founded in 1908 World’s 2nd Largest Company presence in 140 countries Employs 244,500 worldwide Major Brands Buick, Cadillack, Chevrolet, GMC, HUMMER, Saab Problem? Stock Price April 28, 2000: 93.62

I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.

Download Presentation

General Motors Factory Relocation Program

An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -

Presentation Transcript


General motors factory relocation program l.jpg

General Motors Factory Relocation Program

By Yudi Jin

JP Park


Company overview l.jpg

Company Overview

  • Founded in 1908

  • World’s 2nd Largest

  • Company presence in 140 countries

  • Employs 244,500 worldwide

  • Major Brands

    • Buick, Cadillack, Chevrolet, GMC, HUMMER, Saab


Problem l.jpg

Problem?

  • Stock Price

    • April 28, 2000: 93.62

    • May 1, 2009: 1.81

  • Financial Statements

    • Net Loss

      • 2008: 30,860,000

      • 2007: 38,732,000

  • Decreasing Demand

    • 2008: 23% decrease in demand from 2007

  • Hypothesis: Gross Inefficiencies


Scope of project l.jpg

Scope of Project

  • GM North America

    • United States

      • Top 10 Cities (Demand)

  • Factory Location

    • Service

    • Wages

    • Various Costs

      • Transportation


Gm operations in the us l.jpg

GM Operations in the US

  • Total Employees: 97,067

  • Factories: 86

  • Cars and Trucks Produced

    • Q1 2009: 1,652,909

    • 2008: 3,097,924

    • 2007: 4,489,818


Current gm factory locations l.jpg

Current GM Factory Locations


Wage tables l.jpg

Wage Tables


10 cities with lowest production wages percent national l.jpg

10 Cities with Lowest Production Wages (percent National)

  • Brownsville-Harlingen, TX (76)

  • Johnstown, PA (84)

  • Oklahoma City, OK, (85)

  • Orlando-Kissimmee, FL, (85)

  • Birmingham-Hoover, AL, (88)

  • Knoxville, TN, (88)

  • Lincoln, NE, (89)

  • Amarillo, TX, (91)

  • Dallas-Fort Worth, TX, (91)

  • Visalia-Porterville, CA, (92)


Top 10 areas for gm sales l.jpg

Top 10 areas for GM sales

  • Total GM sales Rank Market (add 000)

  • 1. New York-Newark-Edison, NY-NJ-PA $22,756,490

  • 2. Los Angeles-Long Beach- Santa Ana, CA $22,331,511

  • 3. Dallas-Fort Worth- Arlington, TX $13,541,992

  • 4. Chicago-Naperville- Joliet, IL-IN-WI $12,594,549

  • 5. Houston-Baytown-Sugar Land, TX $12,575,414

  • 6. Detroit-Warren- Livonia, MI $10,261,680

  • 7. Washington-Arlington- Alexandria, DC-VA- MD-WV $10,068,928

  • 8. Riverside-San Bernardino-Ontario, CA $9,007,470

  • 9. Seattle-Tacoma- Bellevue, WA $8,870,930

  • 10. Atlanta-Sandy Springs- Marietta, GA $8,684,820


Project locations l.jpg

Project Locations


Comparison l.jpg

Comparison


Formulation l.jpg

Formulation

  • All demand in top 10 cities must be met

    1. 534,575.4

    2. 524,592.1

    3. 318,116.5

    4. 295,860

    5. 295,410.5

    6. 241,058.3

    7. 236,530.4

    8. 211,595.5

    9. 208,388.1

    10. 204,016.1

  • Each factory on average employs 1115 employees costing $32,925,504 in wages (national average) per year

  • Each factory can produce 49,518 vehicles per year

  • Need to place roughly 63 factories in order to satisfy demand

  • Average cost of transportation is $.857 per vehicle per mile


Slide13 l.jpg

Distances between top 10 cities (mi.)


Lp solution l.jpg

LP Solution

  • Minimize factory location w/ respect to cost

  • Solution using Ampl:

  • 7 factories in Dallas shipping to Dallas

  • 11 factories in Visalia shipping to LA

  • 5 factories in Visalia shipping to Riverside

  • 5 factories in Visalia shipping to Seattle

  • 6 factories in Brownsville shipping to Houston

  • 11 factories in Johnstown shipping to NY

  • 6 factories in Johnstown shipping to Chicago

  • 5 factories in Johnstown shipping to Detroit

  • 5 factories in Johnstown shipping to Washington DC

  • 5 factories in Birmingham shipping to Atlanta

  • Objective Value - $2,750,998,404

  • 5-25% cost decrease from current GM locations


Local search l.jpg

Local Search

  • With the unbounded problem there are an enormous number for potential factory locations, solving using an LP solver would not be feasible, another solution would be to use Local Search. After initially placing all factories, it is easy to shift one factory and recalculate costs

  • Ex.


Resources l.jpg

Resources

  • GM ANNUAL FINANCIAL REPORT

  • US Department of Labor

  • http://www.supplyexcellence.com/blog/2006/08/14/gm-drives-toward-cost-goals-with-new-supply-techniques

  • Racher Press Research 

  • http://jalopnik.com/340225/gm-sales-decrease-in-2007-but-people-love-the-aveo

  • http://www.domesticsale.com/autoclassified/prices.html


  • Login