Manufacturing in China vs. Manufacturing using robotic automation in North America
This U.S. foundry was asked by their customer to evaluate the cost effectiveness of keeping their manufacturing in the U.S. vs. moving to China.
Upon initial analysis, the foundry manager calculated that the cost to produce this cast part in the U.S. was 51 cents using manual labor. The cost to produce the part in China and ship the part back to the U.S. was 13 cents.
The foundry operations manager knew that one area with high labor content was in the rough deflashing of the cast parts. Not only did it require a special skill set, it also caused a plethora of injuries. This made the position difficult to fill, and frequently caused bottlenecks due to worker absence, extensive breaks, etc.
The foundry operations manager had recently attended a WebEx Seminar about robotic automation and decided to evaluate the cost effectiveness of automating vs. moving his plant to China.
As it turns out, the operations manager discovered that robotic automation could increase the speed at which the cast part could be de-flashed by 140%.
He thought that the move to China was inevitable until he ran the numbers for automating the process. The foundry operations manager was surprised to learn that their costs to manufacture the part using automation went down to just eight cents per part.
This manager was able to reduce his customer's costs by 84% by investing in robotic automation vs. moving his manufacturing to China.
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