BMW: Custom cars on demand

The automaker uses a pull system to build customer-specified vehicles within 10 days of order placement.

By Staff -- Modern Materials Handling, 2/1/2004

Just think of it. A brand new BMW is sitting in your driveway. Not only does it look great, but it was built to your specifications and arrived in no time at all.

No, this is not a dream. Instead, it's standard operating procedure at BMW's newly expanded manufacturing facility in Spartanburg, S.C. The plant uses a pull system to build customer-specified vehicles within 10 days of order placement.

"This approach has had a huge impact on our entire supply chain," says Manfred Stoeger, vice president of logistics and information technology. "It provides a great amount of flexibility while we customize to meet the needs of our customers."

Using what translates from the German to be "customer oriented sales and production," Spartanburg has lowered its overall inventories, virtually eliminated parts storage at the line, reduced inventories at its suppliers, and provided a much faster turnaround time from order to delivery. And that's why BMW is the winner of Modern Materials Handling'sProductivity Achievement Award for Manufacturing.

Automated staging systems as well as advanced planning, execution and manufacturing software made possible the changes in BMW's materials flow necessary to support customer-specified vehicles.

The 2.1 million square foot plant builds the X-5 Sports Activity Vehicle (BMW's SUV) and the two-seater Z-4 roadster. This is the only plant in the world that builds these two models, and they are the only two models built in Spartanburg.

But while there may only be two models in this giant plant, the number of options is staggering. On the X-5 alone, there are 8 body variances, 12 colors, 19 engine choices, 16 interior choices, and 85 other options.

With that many options, it would seem that BMW might become a bit restrictive in how it operates the plant. In fact, it has devised systems that allow it to accept customer specs only six days before final production of the vehicle begins. That's a 50% cut in the lead time between order placement and production, says Stoeger.

Two automated storage and retrieval systems (AS/RS) act as a buffer to make the delayed assignment possible. One AS/RS holds 220 car bodies while the other holds 230. As vehicles exit the paint shop, they go into the AS/RS where they are held until the assembly line is ready for them.

The combination of staging in the AS/RS and delayed assignment actually increases production flexibility. BMW can now alter the build sequence until nearly the last moment to accommodate any supply chain bottlenecks.

Another important contributor to that flexibility is the highly automated parts warehouse known as the Sequence Center adjacent to the plant. This facility receives and temporarily stages parts coming from suppliers. When the parts are needed for production, they are kitted in a specific build order, and transported by pallet conveyor through a connecting tunnel to the plant.

Separate assembly lines handle production of the two models. Doors are removed as they enter assembly and are placed on a power-and-free conveyor for separate work such as adding windows and locks. They will rejoin the vehicle near the end of the line.

Transportation of the bodies through initial assembly is on a different power-and-free line. Engines and transmissions are brought by automatic guided vehicles (AGVs) to the line. Lifters on the AGVs raise the assemblies up to meet the car body, where the two are married together.

Skillet conveyors move the vehicles through the trim functions. Bodies rest on lifters at the center of these moving platforms, lifting and lowering the assembly as workers ride along adding consoles, lights and other parts. Robots place the seats in place. Assembled autos receive fluids and are inspected and tested prior to release from the plant.

None of this would happen with any coordination without BMW's advanced information system. "We have changed our information systems completely internally and to our suppliers," says Stoeger.

A sophisticated enterprise resource planning system and associated production software are central to this shift. Specific requirements for individual customer orders are broadcast daily to each of the suppliers for cars that will be produced.

"We are able to keep our suppliers constantly in the information loop," says Stoeger. This helps us to keep an extremely high sequence adherence in assembly. This provides accurate and stable demand data to our suppliers," he adds.

The end result is parts arrive in sequence at the line just before a car body needs those parts to fill a specific order. This degree of coordination makes it possible to consistently build a vehicle within two days.

"BMW is setting an industrial benchmark," explains Stoeger. "Our focus is to follow the market demand. It is a challenge to our supply chain, but gives us a competitive advantage."