The impact of remanufacturing on service levels of automobile spare parts supply chain

Abstract

Remanufacturing is described as removing a product or component from a retired system and installing it in another system. In today’s world one can already discover an impressive range of application examples representing remanufacturing as the ultimate form of recycling. Remanufacturing has its roots and displays a long tradition already since the very first moves and outcomes of the industrial age like steam engines, railways, power generation and electrical equipment, machine tools etc. Furthermore remanufacturing always has been a strong partner throughout the uprise of the automotive sector, which undoubtedly is the main industrial driving force so far. In this study, the spare parts supply and distribution system of a major distributor of automotive spare parts in Turkey is analyzed for a representative spare part viz. a brake pad. Control variables of the distributor and dealers together with the main performance indicators of the system are figured out. In order to observe the effect of change in control variables on performance indicators, a simulation model is constructed by using C++. Afterwards, the simulation model is extended with remanufactured parts. The objective of the study is to capture the impact of remanufactured parts on system performance, especially on service levels. Remanufactured parts, in focus of this thesis, is not considered as an alternative but as a safety stock to the original part. In the conclusion of the study it is denoted that service level is subject to change under different disposal and remanufacturing control policies.