Hosuki case problem | Economics homework help

Hosuki, a small car maker, competes with larger manufacturers by building cars to order. The company has invested heavily in technology and close partnerships with suppliers. Customers enter their orders and choose their options on the company website. Hosuki’s ERP system responds with an estimated cost and completion date. After the customer approves the order, Hosuki sets to work.

Quick response for Hosuki is dependent on collaborative manufacturing with its trading partners. A virtual bill of material for a typical car appears below. Notice each item is color-coded to its supplier and indented beneath its parent assembly. Hosuki has full visibility into its suppliers’ ERP systems to check on-hand quantities and order progress. These data are essential in quoting accurate due dates. Most of the car’s components are purchased. Hosuki makes the car body, assembles major subassemblies, and completes final assembly and testing. The body stamping machine operates eight hours a day; setup times per item and run times per unit are given in the next column.

Since the suppliers produce in high volume, the lead time for an order is the same regardless of the quantity of the order. In contrast, with limited sales volume and limited space, Hosuki assembles its cars in batches of 10. Each assembly process takes half a day.


Hosuki has just received its first corporate order—for 10 midsized vehicles. The customer would like delivery as soon as possible.


Create a time-phased assembly chart to determine when the 10 cars can be delivered.

What adjustments are needed in inventory levels, lead times, and batch sizes to fill an additional customer order for five custom cars in five days?

Virtual Bill of Material

  Item Qty
  Midsize car 1
  Chassis Assembly 1
  Frame 1
  Power Train Subassembly 1
  Engine 1
  Transmission 1
  Radiator 1
  Battery 1
  Suspension Subassembly 1
  Shocks 2
  Brakes 1
  Body Assembly 1
  Windshield 1
  Seats 4
  Tire Assembly 4
  Wheels 1
  Rims 1
  Tires 1

Supplier lead time is given in days

Supplier A
Shocks 20 1
Barkes  2 4
Supplier C
Wheels 20 1
Rims  2 2
Tires 10 5
Supplier D
Frame 10 2
Windshield  5 4
Supplier E
Engine  5 5
Transmission 10 6
  Supplier F
Radiator 10 1
Battery  5 3
Hosuki’s Body Stamping Machine
  Qty Setup (hrs) Runtime (hrs/unit)
Qtr Panel 4 2 0.5
Hood 1 1 0.2
Fender 2 2 0.3
Roof 1 2 0.2
Doors (LH, RH) 4 2 0.2


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