Component remanufacturing for improved lifecycle utilization

Abstract: Remanufacturing is the process of collecting end-of-life products from customers and then being dissembled, reprocessed and reassembled to create new products to meet the customers’ needs. The economic viability of the implementation of a remanufacturing strategy has being shown among many companies in the automobile industry. Also, the economic profitability of the remanufacturing process has been proven in many industrial case studies. Cummins Scania XPI Manufacturing in Södertälje considers implementing a remanufacturing process for their returned components, but there is a lack of a foundation of whether this process will provide an economic profitability or not. In order to decide whether the remanufacturing is profitable for the company, there are some factors to consider. This research aims to identify the reasons behind implementing a remanufacturing process and the factors that affect the economical profitability of it. In order to answer the research questions, a theoretical investigation as well as several interviews with Cummins Scania XPI Manufacturing in Södertälje and Cummins XPJ in Mexico has been done. The aim with the interviews with Cummins Scania XPI in Södertälje was to identify what factors they want to consider when determining whether the remanufacturing process can be economic beneficial for them. The interview with Cummins XPJ was done in order to get an understanding how their remanufacturing process work. The result shows that there can be three main reasons behind implementing a remanufacturing process: economic benefits, environmental benefits as well as legislation. When it comes to the considered factors when implementing the remanufacturing process, the reverse logistic with the aim to remanufacture is important to consider since the remanufacturing is a fundamental process of it. Thereafter the possible factors that can be occurred are one-time costs such as prices of machines, fixed costs such as operators’ costs and where to implement the process. The results of this research provide a possibility for companies to determine whether the remanufacturing process is economically profitable for them.