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Physical Internet-enabled automobile production–distribution joint optimisation with multistage workshop

Shoufeng Ji (School of Business Administration, Northeastern University, Shenyang, China)
Yaoting Xue (Department of Operation and Logistics Management, School of Business Administration, Northeastern University, Shenyang, China) (Department of Supply Chain and Transport Planning, BMW Brilliance Automotive Ltd, Shenyang, China)
Guosong Zhu (Department of Supply Chain and Transport Planning, BMW Brilliance Automotive Ltd, Shenyang, China)

Kybernetes

ISSN: 0368-492X

Article publication date: 19 January 2022

Issue publication date: 3 March 2023

167

Abstract

Purpose

The Physical Internet (PI) application in a supply chain is explored by automakers to achieve a digital supply chain to challenge timely delivery while maintaining high customised production at the lowest operating cost.

Design/methodology/approach

A bi-objective mixed integer model is formulated, where production is performed in multistage manufacturing systems (MMS) and then delivered in a two-level distribution system. Next, a hybrid iterative method algorithm is developed to solve the practical-scale problem within an admissible time. Finally, PI's benefits on production and supply chain operation are discussed through extensive computational experiments in different supply chain configurations.

Findings

Three significant findings are obtained. First, PI can achieve a comparable or better service level, while the cost is always lower. Second, PI can improve the utilisation of production and transportation resources. Third, with a more complex supply chain and a higher production cost or truck fixed cost, PI's advantages over traditional supply chain become more vigorous, but the increase in orders will weaken it.

Practical implications

The auto enterprise should adopt a PI-enabled supply chain (PI-SC), especially with the increase of network complexity and specific cost factors.

Social implications

Importance should be attached to the PI-SC to make customers better involved in the supply chain.

Originality/value

First, the application of PI in the existing plant is described. Second, MMS production with multi-mode transportation is jointly scheduled. Third, the decision support of the PI-SC is provided for auto enterprises.

Keywords

Acknowledgements

This work was supported by the National Natural Science Foundation of China [grant number 71971049], and the National Natural Science Foundation of China [grant number 71572031].

Disclosure statement: No potential conflict of interest was reported by the authors.

Citation

Ji, S., Xue, Y. and Zhu, G. (2023), "Physical Internet-enabled automobile production–distribution joint optimisation with multistage workshop", Kybernetes, Vol. 52 No. 3, pp. 898-920. https://doi.org/10.1108/K-03-2021-0217

Publisher

:

Emerald Publishing Limited

Copyright © 2021, Emerald Publishing Limited

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