LVMH, GM , Tesla, Razer are all companies that said they’re switching their line of production in times of crisis.
How are they able to do it so quickly? Im talking about their inbound logistics, supply chain, their products and also the machines used?
IIRC (really vaguely) these big companies invest heavily into machines that can only do one task/one item/one part of a product, but do it in extremely efficiently. Wouldn’t switching the line of productions make those type of equipment obsolete??
In: Economics
No, companies invest in machines that have multiple applications. If a company bought a machine that could only do one item, as soon as the next keyboard came out from razor they would have to junk that machine unless it made key caps.
The machines are standard pieces of equipment that you can pick out in a catalog from an equipment manufacturer. Most of the customization is done by installing a custom tool or a custom program into the machine. This is how car manufacturers are able to switch an assembly line from one car model to another car model. They just swap out the tools and restart the assembly line.
That being said the machines they have and the layout of the assembly line is highly optimized for producing cars. And even then if the car models are very different from each other it might also cause issues. But those issues can be worked around at the expense of slower production rates. So changing the assembly line from cars to medical devices would severely reduce the manufacturing capability. You have issues such as big machines being used for manufacturing small components, machines normally used for high output items having to wait around for days as the other parts of the assembly line have to catch up with it, parts having to be shipped all the way across the factory and back because the machines are not located next to each other and machines that are not used as they are not needed.
Of course how much production as affected depends on what you are making and what you used to make before. A lot of factories have already switched production to higher demand items as this does not impact their production at all. For example switching from manufacturing sails for sail boats to manufacturing overalls for hospital workers is not much more difficult then reprogramming your cutting and sowing machines. You do not even have to change the materials. Similarly medical alcohol and drinkable alcohol is mostly the same substance so any distillery can start making hand sanitizers.
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