An analytical model for reverse automotive production planning and pricing

Qu, Xiuli; Williams, Julie Ann Stuart

doi:10.1016/j.ejor.2007.06.041

An analytical model for reverse automotive production planning and pricing

Qu, X., & Williams, J. A. S. (2008). An analytical model for reverse automotive production planning and pricing. European Journal of Operational Research, 3(1), 756-767. doi:10.1016/j.ejor.2007.06.041

Details

Title: An analytical model for reverse automotive production planning and pricing
Contributor(s): Qu, Xiuli (author)
Williams, Julie Ann Stuart (author)
Located In: European Journal of Operational Research
ISSN: 0377-2217
Date: 2008
DOI: 10.1016/j.ejor.2007.06.041
Use/Reproduction: 2007 Elsevier B.V.
Abstract: Automotive shredders need a reverse production planning strategy that includes determining at what price to purchase vehicle hulks from different sources. In this paper, we formulate the automotive reverse production planning and pricing problem in a nonlinear programming model, develop an approximate supply function for hulks when adjacent shredders price independently, and compare two hulk pricing strategies in three trends for ferrous metal and hulk prices: constant, increasing and decreasing. The case study results indicate that adjusting purchase price based on hulk composition in coordination with planning for purchasing, storing and processing can increase net revenue by 7–15%.
Subject(s): Pricing
Reverse production planning
Environment