See discussions, stats, and author profiles for this publication at: https://www.researchgate.

net/publication/323761995

Closed-loop supply chain simulation with disruption considerations: a case-

study on Tesla

Article  in  International Journal of Inventory Research · January 2017

DOI: 10.1504/IJIR.2017.090361

CITATIONS READS
17 4,815

3 authors, including:

Dmitry Ivanov Daria Battini

Hochschule für Wirtschaft und Recht Berlin University of Padova
324 PUBLICATIONS   10,398 CITATIONS    136 PUBLICATIONS   3,088 CITATIONS   

SEE PROFILE SEE PROFILE

Some of the authors of this publication are also working on these related projects:

International Journal of Integrated Supply Management View project

MAIA: models and methods for an active ageing workforce - an international academy View project

All content following this page was uploaded by Dmitry Ivanov on 22 June 2019.

The user has requested enhancement of the downloaded file.

This is an author version of the paper “Closed-loop supply chain simulation with disruption con-

siderations: A case-study on Tesla” published in International Journal of Inventory Research:

Gianesello P., Ivanov D., Battini D. (2017). Closed-loop supply chain simulation with disruption

considerations: A case-study on Tesla. International Journal of Inventory Research, 4(4),

257-280.

Closed-loop supply chain simulation with disruption considerations: A case-study on Tesla

Pietro Gianesello1, Dmitry Ivanov2*, Daria Battini1

1 Università degli Studi di Padova, Dipartimento di Tecnica e Gestione dei Sistemi Indu-
striali, Stradella San Nicola 3, 36100 Vicenza, Italy. E-mail: daria.battini@unipd.it
2
Berlin School of Economics and Law, Department of Business and Economics
Professor of Supply Chain Management, 10825 Berlin, Germany
Phone: +49 3085789155; E-Mail: divanov@hwr-berlin.de
* Corresponding author
Abstract

Performance impact of severe disruptions in the reverse part of an automotive closed-loop supply
chain is studied with the use of a discrete-event simulation model implemented in anyLogistix
software. A hybrid case study-simulation methodology is applied in this research to analyze the
six-echelon closed-loop supply chain of Tesla from positions of resilience. Based on the second-
ary data, an example for the German market has been created and investigated. More specifical-
ly, the results help to show how a disruption in the reverse supply chain may affect the financial
and operational performances of the company. Different recovery policies have been simulated
in order to analyse how each might recover the supply chain from disruption and restore its oper-
ation and performance.

Keywords: closed-loop supply chain; resilience; simulation; anyLogistix; disruption; case-study;

performance; e-mobility; reverse logistics

Pietro Gianesello is a master student at the University of Padova (Italy) and Berlin School of
Economics and Law (Germany). His research interest encompasses supply chain simulation
software and closed-loop supply chain management.
Dr. habil. Dr. Dmitry Ivanov is Professor of Supply Chain Management at Berlin School of Eco-
nomics and Law (BSEL). His research explores supply chain structure dynamics and control,
with an emphasis on global supply chain design with disruption consideration, distribution plan-
ning, and dynamic (re)-scheduling. He is (co)-author of structure dynamics control method for
supply chain management. He gained his PhD (Dr.rer.pol.), Doctor of Science (ScD), and Habili-
tation degrees in 2006 (TU Chemnitz), 2008 (FINEC St. Petersburg), and 2011 (TU Chemnitz)
respectively. In 2005, he was awarded a German Chancellor Scholarship. He is the (co)-author of
more than 260 publications. Professor Ivanov’s research has been published more than 50 papers
in prestigious academic journals. He is Chair of IFAC TC 5.2 “Manufacturing Modelling for
Management and Control”.

Dr. Daria Battini is Associate Professor of Industrial Systems and Logistics at the University of
Padova (Italy). The principal topics covered by her researches are: industrial system design and
management (in particular flexible assembly systems), supply network mapping, modeling and
optimization with particular attention to Closed Loop Supply Chains, ergonomics in material
handling and in assembly, the inventory management and product/process traceability. Her re-
searches are published in several international journals, international conference proceedings,
trade magazines, industry reports and newspapers. She published more than 60 scientific papers,
published in International ISI and Scopus journals. She is a member of IFAC and Euroma.
 1. Introduction

We study the impact of severe disruptions (i.e., random events that may affect the structural dy-

namics of a system such as natural and man-made catastrophes, strikes or political crisis) on sup-

ply chain (SC) performance in an automotive closed-loop SC (CLSC). More specifically, the

objective and contribution of this study is to develop an approach to analyse the disruptions in

the reverse part of the CLSC (e.g., a temporary unavailability of a warehouse for collecting the

used batteries for electric cars) in regard to (i) their impact on overall SC performance as well as

to (ii) proactive and reactive policies with considerations of inventory control policies and sus-

tainable manufacturing concepts.

Inventory management has been evolving over last decade with an ever increasing consideration

of sustainability factors and CLSC management (Govindan et al. 2015, Heydari et al. 2017, Jei-

hoonian et al. 2017, Basiri and Heydari 2017). However, the inventory control policies subject to

disruptions in the reverse part of the CLSC have rarely been analysed. Such an analysis appears

to be an important contribution to the sustainable inventory management domain since the resili-

ence of the reverse CLSC part is tightly interrelated with the sustainable inventory management

and SC sustainability in general (Rezapour et al. 2015, Feng et al. 2017, Heydari et al. 2017).

Since the beginning of the industrial development, companies considered the possibility of reus-

ing and recycling parts of products or materials for efficiency increase. At the beginning, this

concept only at a small scale for high-value and low-volume products such as railway industry

was used (Guide and Van Wassenhove, 2009). Recently, the importance of managing the closed-

loop material flows has been given increasing consideration for three main reasons: First, the

need to satisfy the requirements imposed by the legislations; second, many firms realised the

strong positive economic effects that could be realized as a result of recycling and reusing oppor-
tunities; finally, companies exploited the customers’ concern for the environment, aiming to im-

prove their public image to gain a competitive advantage (Jeong-Eun & Kang-Dae, 2013, Choi

2013, Yuan et al. 2015, Ivanov et al. 2017a).

Following the literature analysis, it becomes evident that the forward and reverse SCs need to be

designed and analysed simultaneously to maximize the company benefits (Zhou et al. 2017).

This need for integration becomes more critical because of the competitiveness of the actual en-

vironment where the organization must deal with high fluctuations in the demand to assure cus-

tomer satisfaction at a high level of costs efficiency (Hasani et al. 2012).

Along with the demand uncertainty which is typically referred to in literature as recurrent or op-

erational risks (Tang 2006, Chopra et al. 2007, Klibi et al. 2010, Fahimnia et al. 2016, Ivanov

2017), uncertainty and risks of severe disruptions such as explosions, fires, tsunami, strikes or

political crises have recently appeared in literature as a crucial research avenue to improve SC

resilience (Ivanov et al. 2014, Ambulkar et al. 2015, Snyder et al. 2016). Disruption risks have

been extensively investigated in regard to SC performance analysis of different disruptions, pro-

active and reactive policies (Ivanov et al. 2017c) whereby simulation analysis has been recog-

nized as a useful tool to model disruption and recovery SC dynamics (Carvalho et al. 2012,

Schmitt and Singh 2012, Ivanov 2017). However, disruption analysis in the reverse parts of

CLSCs still represents a research gap.

In regard to the contribution to the existing literature, this is the first study that applies discrete-

event simulation methodology to analyze disruptions in the reverse part of a CLSC. More specif-

ically, the temporary unavailability of a warehouse for collecting used batteries for electric cars

is considered. The impact of this disruption is analysed in regard to overall SC operational, fi-

nancial, and customer performance. Subsequently, proactive and reactive policies with consider-
ations of inventory control policies and sustainable manufacturing concepts are simulated and

managerial insights are derived.

The rest of this paper is organized as follows. In Sect. 2, literature analysis is performed. The

case-study and problem statement are described in Sect. 3. In Sect. 4, the conceptual simulation

model is presented. Sect. 5 comprises experimental simulation results and their managerial anal-

ysis. We conclude the paper in Sect. 6 by outlining the main insights and future research needs.

2. State-of-the art analysis

We start the literature review analysis with recent simulation studies with disruption considera-

tions. A disruption may be defined as an unplanned and unanticipated event that can disrupt the

normal flows of activities and products along the SC and that can cause stockouts, customer dis-

satisfaction and great financial losses for all the members of the SC (Spiegler et al. 2012, Ivanov

et al. 2017a).

Severe disruptions can be characterized by three important dimensions of analysis, i.e., magni-

tude, duration, and frequency. Compared to the bullwhip effect, which is associated with high

frequency/low impact disruptions, severe disruptions are associated with low frequency/high

impact profiles and present new challenges for the SC managers (Ivanov 2017). This complexity

increases with the range and intensity of the disruption (Świerczek, 2013).

Carvalho et al. (2012) analyse a four-stage automotive SC. They focus on recovery strategy in-

fluences on the SC performance in the case of disruptions. The performance impact has been

analysed in regard to lead-time ration and total SC costs using an ARENA-based simulation

model. Schmitt and Singh (2012) modelled proactive and recovery strategies that include satis-

fying demand from an alternate location in the network, procuring material or transportation

from an alternative source or route, and holding strategic inventory reserves throughout the SC.
The authors reveal a dependence on employment efficiency of back-up mitigation methods on

the response speed.

Lewis et al. (2013) analyse the disruption risks at ports of entry with the help of closure like-

lihood and duration which are modelled using a completely observed, exogenous Markov chain.

They study a periodic review inventory control model that for studied scenarios indicates that

operating margins may decrease 10% for reasonably long port-of-entry closures or eliminated

completely without contingency plans, and that expected holding and penalty costs may increase

20% for anticipated increases in port-of-entry utilization. Hishamuddin et al. (2015) simulate a

three-echelon inventory system in the SC with multiple sourcing and consider both supply and

transportation disruptions. They include disruption duration, recovery costs, and a random dis-

ruption generator in the model. The most important finding of this study is that back-order quan-

tity and recovery duration have strong positive correlations with total SC costs as compared to

the importance of lost sales.

In analyzing disruptions in the reverse SCs, it is important to understand the structural and finan-

cial aspects influencing this domain. According to the study by Giuntini & Gaudette (2003), the

average cost of collecting and remanufacturing a product is typically 40-60% of the cost of a

brand-new product. Large retailers, such as Home Depot, could have return rates of 10% of sales

or higher, with total values of returns that run around hundreds of millions of dollars for a single

retailer (Guide & Van Wassenhove, 2009).

In regard to structural CLSC design, the use of the logistics consolidation centers has been dis-

cussed in the study by Kaynak et al. (2014). The consolidation centers aim at creating a central-

ized, coordinated, and integrated network for both the forward and reverse flows. Hasani et al.

(2012) and Choi (2016) point out that the creation of an agile and resilient CLSC helps to im-
prove the flexibility, adaptability and quick response to utilize the emerging opportunities in the

market. A similar concept is extremely important regarding the design of resilient SCs when

considering severe disruption risks in the reverse flows (Ivanov et al. 2017b). At the same time,

analysis of both CLSCs and disruptions is still considered a research gap (Ivanov et al. 2014,

Snyder et al. 2016). At the interface of disruption risks and sustainable inventory management,

lead-time and service level control issues play an important role. These issues have previously

been investigated in the SC coordination setting (Chaharsooghi et al 2011, Heydari 2014, Hey-

dari and Asl-Najafi 2016) in order to take into account the uncertainty of the reality with the in-

clusion in the model of some stochastic parameters (Battini et al, 2017).

3. Case-study description and problem statement

3.1. Case study on Tesla

Tesla Motors was founded in 2003 (EdgarOnline 2016). The company designs, develops, manu-

factures and sells electric vehicles and energy storage products. These electric cars are designed

on the technology of the Lithium-Ion Battery (LIB). Tesla Motors delivers and sells its products

through an international network which comprises over 350 suppliers and different facilities all

over the world. The core of Tesla’s SC network is ten facilities scattered around the world in

which all processes of design, engineering development, production, warehousing, assembling,

administration, market forecasting and sales and customer management services are concentrated

(Table 1).

Table 1: Tesla facilities (Factories, Warehouses, Services centers) (EdgarOnline, 2016)

Facility Location Size [ft2] Lease Expiration Date

Palo Alto, California 350000 January 2020
Hawthorne, California 132250 December 2022
Lathrop, California 430770 Owned building
 Fremont, California 5400000 Owned Building
Gigafactory, Nevada 10000000 Owned building
Amsterdam, Netherlands 71142 February 2024
Tilburg, Netherlands 499710 November 2023
Fremont, California 302400 March 2028
Fremont, California 506490 August 2025
Beijing, China 8190 November, 2017

The Gigafactory plays an important role in the future strategy of Tesla. The Gigafactory is a new

Tesla factory located in Reno, Nevada. The full site completion is scheduled for 2018. In 2020,

the factory should reach full operative capacity (Bloomberg, 2016). When completed, the build-

ing will cover an area of 10,000,000 square feet (it will be one of the largest buildings in the

world), create jobs for 6,500 new employees and be able to produce 50 [GWh/year] of LIBs,

enabling the production of 500,000 vehicles per year (AssoElettrica, 2014). The main purpose of

the Gigafactory is to concentrate the production of all the LIBs for both the electric vehicles and

the energy storage devices in a single facility to utilize scale effect advantages. According to

Musk and the managers of Tesla Motors (WIRED, 2016), the construction of the Gigafactory

will lead to a reduction in the LIB costs by 30-50% by 2020. According to Chung et al. (2016),

in 2015 the global LIB price was around 220-280 [$/KWh] depending on the market, with an

average of 270 [$/KWh]. To define the final selling price, the global cost of the battery should be

increased by 30-35% to account for the gross margin and the profits of the organization as sug-

gested in Nelson et al. (2011). With the Gigafactory, the company aims to produce500,000 cars

per year within the 2018-2020, while at the moment the company produces around 50,000 cars

per year (EdgarOnline, 2016).

Tesla Motors has started different partnerships with several suppliers to secure a sufficient flow

of key inputs necessary to the LIB production (i.e. lithium, cobalt, etc.). Tesla has announced a

supplying agreement with the company Pure Energy Minerals in the Claytone Valley in Nevada

(Fehrenbacher, 2015). At the same time, the reuse of LIB has gained increasing importance and

attention in the last decade. With reuse, the LIB lifetime can be increased with a second or third

life-cycle.

3.2. Verbal problem statement

Consider a six-echelon CLSC with collection points and a recycling plant based on the real SC

structure of the company Tesla Motors. The problem is based on the propositions of Tesla’s

managers and the market analysts for the period from the 2018 until 2025 (cf. Section 3.1) focus-

ing on the use of lithium in the LIB production for the Tesla German market and its recycling.

The logical structure of the model and of the material flows is shown in Fig. 1.

Raw LIBs LIBs

Lithium

Lithium Main DC Customers

Gigafactory
Supplier

LIBs
Raw
Lithium

Collection
Recycling Plant
Points

LIBs

Forward logistics Manufacturing plant Supplier

Reverse logistics
Warehouse/DC End customer
Material flow

Forward supply chain facility : Reverse supply chain facility

Fig. 1 Closed-loop supply chain for LIB

The lithium supplier is the company Pure Energy Minerals in Nevada. The site for the LIB pro-

duction is the new Tesla Gigafactory in Reno, Nevada. The warehouse is the distribution center

(DC) located in Tilburg, Netherlands that serves the Tesla European market. On the customer

side, the model considers the 14 most populous German cities. In Fig. 2, the SC structure de-

scribed above is presented as it is built in anyLogistix software.

Fig 2: Global supply chain structure and the European part (a screenshot from anyLogistix

software)

The two collection DCs are the hypothetical locations which were derived using a standard cen-

ter-of-gravity method. The first is located in Berlin and collects the exhausted LIBs from the
customers Berlin, Dresden, Leipzig, Hannover, Bremen, and Hamburg. It is called “collection

point north”. The second is located in Frankfurt am Main and collects the LIB from Dortmund,

Essen, Dusseldorf, Cologne, Frankfurt am Main, Nuernberg, Munich, and Stuttgart. It is called

“collection point south”. The recycling plant is the company Toxco, which is located in Ohio

(Tesla, 2016) because of the centralization strategy of the company. This is one of the most ad-

vanced recycling plants in the North America and the world and is characterized by innovative

processes that assure high energy and material savings.

The general scope of the problem is to analyze how a disruption at one of the collection DCs in

the reverse SC may affect the financial, customer and operational SC performance and which

recovery policies should be used to restore SC operation and performance.

4. Simulation model

4.1 Simulation model logic

In Fig. 3, the logic of the developed simulation model is presented.

Fig. 3. Simulation model logic

Customer demand for new LIBs generates orders at the DC. The DC operates subject to s,S in-

ventory control policy and places orders at the Gigafactory according to s,S parameters and ex-

pected lead-time at the customers. The used LIBs create two flows towards the collection points

North and South. The collection points ship the LIBs to the recycling plant. The Gigafactory can

order the lithium for LIB production either from the recycling plant in Ohio or from the lithium

supplier in Nevada. The costs of purchasing lithium from the recycling plant is lower than from

the lithium supplier. However, the capacity of the recycling plant is limited and subject to the

flow of the re-used LIBs from the collection points. In the case of a disruption at one of the col-

lection points, this flow would be reduced and the Gigafactory would increase the order quantity

at the lithium supplier subject to higher costs. The detailed inventory and production control pol-

icies will be explained in Sect. 4.2.

4.2 Input data and assumptions

4.2.1. DCs, factories, customers, supplier

For the DCs and factories, outbound processing cost has been defined [$/m3] to consider the

costs of ordering, storing, handling and delivering the materials. The model focuses only on the

costs related to the material handling, i.e. the warehousing costs as 3% of the inventory value

based on Azzi et al, (2014). Outbound processing cost for main DC and Gigafactory is 1,080

[$/m3]. The collection points ship exhausted LIBs that have already performed two or three life-

cycles. For this reason, we consider a value of inventory of 30% compared to the new batteries

(324 [$/m3]). The lithium supplier is an external supplier with its own goals, information sys-

tems, production, and transportation strategies. This causes an increase in the costs of deliveries

and ordering. For this reason, we consider an outbound processing cost of 9% at the inventory

value (2000 [$/m3]). For the recycling plants an outbound processing cost is 600 [$/m3].
At Gigafactory, fixed costs are considered. The Gigafactory will hire 6,500 employees at full

capacity to produce 500,000 vehicles per year (AssoElettrica, 2014). Considering that the model

focuses only on the German market with 40,000 cars per year, we take into account a total num-

ber of employees equal to 520, which is calculated as 6,500*(40,000/500,000). Considering an

average salary of 1,400 [$/month,] the wage costs is defined as 728,000 [$/month].

4.2.2. Products

We consider two different products shipped along the SC: lithium and LIB. Although in the LIB

production different lithium carbonates are used, without loss of generality we assume the use of

pure lithium. For 1 kg of lithium, we assume a volume of 0.002 [m3] and a cost of 45 [$/Kg]. The

lithium price is derived by USGS (2012) and Wang et al. (2014). For the LIB, the values are an

average based on the typical battery of 85 [KWh] used in the Tesla Roadster and model S. We

consider an actual price of the LIBs of 160 [$/KWh] (WIRED, 2016). One battery has a weight

of 450 [Kg] and a volume of 0.37 [m3] (Berdichevsky et al., 2006). Considering an 85 [KWh]

battery with a price of 160 [$/KWh] results in a total cost of 13,600 [$]. This cost is increased by

30% to account for organization profits (Gaines et al., 2000; Nelson et al., 2011). The selling

price is therefore 18,000 [$/battery]. The final recycling cost of one battery is as 700 [$/battery].

4.2.3. Demand

Since Gigafactory Tesla aims at producing 500,000 [vehicles/year] (AssoElettrica, 2014) and

Europe is the second largest market for the electric cars, a future increase in Tesla’s sales due to

the Gigafactory is assumed. According to the new report of non-governmental organization

Transport & Environment, until 2025 the number of electric cars in Europe will rise to over

500,000 (CNBC, 2016). In only the first half of 2016, more than 91,000 electric cars have been

sold in Europe (Clean Technica, 2016). Among European countries, Germany is the second big-
gest market after Norway. Furthermore, the German government invested in incentives to pro-

mote the spread of electric cars. The scope is to reach 500,000 electric cars in Germany (Eccheli,

2016). At the moment, the European market impacts 30-40% of Tesla’a global sales (model S +

model X), with around 18,000 cars sold per year in Europe (Tesla Motors, 2016). By considering

the current Tesla European sales, the incentive factors stated above and by projecting the current

Tesla market share in Europe based on increased production in the future, it is realistic to fore-

cast a future demand of 40,000 vehicles per year for the German market as shown in Table 2.

Table 2: Customer demand

CUSTOMER POPULA- MARKET ANNUAL WEEKLY σd MIN-MAX

TION SHARE DEMAND DEMAND [pz/week] DEMAND
[pz/year] [pz/week] [pz/week]
Berlin 3,501,872 26.14% 10456 218 73 145 - 291
Hamburg 1,798,836 13.43% 5372 112 38 74 - 150
Munich 1,378,176 10,28% 4112 86 29 57 - 115
Cologne 1,017,155 7.61% 3044 64 22 42 - 86
Frankfurt am Main 691,518 5.21% 2084 44 15 29 - 73
Stuttgart 613,392 4.62% 1848 39 13 26 - 52
Dusseldorf 592,393 4.44% 1776 37 13 24 - 50
Dortmund 580,956 4.34% 1736 36 12 24 - 48
Essen 573,468 4.28% 1712 36 12 24 - 48
Bremen 548,319 4.12% 1648 35 11 24 - 47
Leipzig 531,809 3.97% 1588 33 11 22 - 44
Dresden 529,781 3.95% 1580 33 11 22 - 44
Hanover 525,875 3.92% 1568 33 11 22 - 44
Nuernberg 510,602 3.81% 1524 32 10 22 - 42
TOTAL 13,394,152 100% 40000 834 ---- 557-1134

Total demand is distributed among the different customers (i.e. German cities) depending on

their population. The population of each city is then divided by this value to find its market
share. The annual demand is multiplied by this market share to determine the mean annual de-

mand for each customer region and the mean weekly demand (the model considers one year con-

stituted of 12 months of four weeks each).

The demand is considered normally distributed in the different periods (i.e. weeks) with a stand-

ard deviation σ equal to 1/3 of the mean value. The mean demand is constant throughout the

year. The different customers have an expected lead-time of 15 days with an allowed backorder

policy (the delayed orders are postponed but not dropped).

Even if the LIBs may be directly re-used after their first life-cycle with a simple operation of

inspection and cleaning, we focus only on the recycling of the LIBs. We assume a battery return

rate of 75%. The reverse flows subject to shipment frequency of five days for the different cus-

tomers are shown in Table 3.

Table 3 Reverse flows to collection points North and South

Reverse customers Collection point MIN–MAX FLOW [pz/shipment]

Berlin North 73-145

Hamburg North 37-75

Bremen North 12-24

Leipzig North 11-22

Dresden North 11-22

Hanover North 11-22

Dusseldorf South 12-25

Essen South 12-24

Frankfurt South 15-37

Cologne South 21-43

 Dortmund South 12-24

Munich South 29-58

Nuernberg South 11-21

Stuttgart South 13-26

4.2.4. Vehicle types and paths

We consider four different types of vehicles for the shipments. For the deliveries from the sup-

plier to Gigafactory and from the end customers to the collection points, trucks’ cargo compart-

ments have a capacity of 15,000 kg and 50 m3. For the deliveries from the main DC to the cus-

tomers the model uses a eurotruck with capacity of 22,000 kg and 70 m3. For both types of

trucks, we assume speed to be normally distributed with mean and σ of respectively 50 and 20

km/h. For transportations from Gigafactory to Main DC and from the collection points to the

recycling plant, we assume the use of Boeing 777-200ER aircrafts with a capacity of 50,000 kg

and 90 m3. For shipments from the recycling plant to Gigafactory, we assume the use of Boeing

777-200 aircrafts with a capacity of 20,000 kg and 60 m3. The choice was made based on com-

mon practice in intercontinental and national American transportation. For the air transportation,

we assume a normally distributed speed with mean and σ of respectively 700 and 100 km/h.

For the transportation costs computation, a weight-distance based policy is used. The cost of

trucks is defined as 0.00015 [$/Kg*Km] and for the air transportation as 0.00062 [$/Kg*Km]

based on the works of Hummels (2007), Lupi (2012) and Battini et al. (2014).

The model considers an LTL transportation policy with a minimum load ratio of 0.9 and an ag-

gregation period of five days. The choice of such a short aggregation period is made to improve

the service level (i.e., to increase the ratio of customer on-time orders). In the return routes from
the customers to the main DC, a distance-based transportation policy with a cost of 0.95 [$/Km]

is used (Analisi dei costi nei trasporti, 2012, p. 13).

4.2.5. Inventory

To define the inventory level at the main DC, we assume a MIN-MAX policy with safety stock.

Due to the lack of historical data, we assume that a safety stock SS equals the mean weekly de-

mand (834 batteries). This means that the MIN (s) and MAX (S) inventory levels are as follows:

𝒔 = 𝑺𝑺 + (𝜎𝑑 ∗ LT) = 834 + (834 ∗ 1.4) ≈ 2000 [LIB]

𝑺 = 2 ∗ 𝒔 = 4000 [LIB]

The model considers an initial stock of 2,834 batteries to cover the minimum level of inventory

and the safety stock at the beginning of the simulation run. These values of inventory are then

projected backwards along the SC in order to assure the capability of production and the availa-

bility of material necessary to satisfy the end customer demand. For the products needed for the

production policies, a reorder point-reorder quantity policy (R, Q) is assumed. The inventory

policies defined for different SC facilities are summarized in Table 4.

Table 4: Inventory control policy parameters in the supply chain

FACILITY PRODUCT INVENTORY R Q SS s S INITIAL

POLICY STOCK
Lithium sup- lithium infinite ---- ---- ---- ---- ---- ∞
plier
Gigafactory lithium R-Q 130000 50000 ---- ---- ---- 180000
Gigafactory LIB MIN-MAX ---- ---- 834 3000 3500 3834
Collection LIB MIN-MAX ---- ---- ---- 150 300 550
Point North
Collection LIB MIN-MAX ---- ---- ---- 150 300 400
Point South
Recycling LIB R-Q 1200 920 ---- ---- ---- 800
Plant
Recycling lithium MIN-MAX ---- ---- 33000 50000 90000 50000
Plant
4.2.6. Production

We define two production policies. The first one is related to the Gigafactory and is based on the

BOM (bill-of-material) “battery”. The production cost of one battery is $13,600. According to

Gaines et al. (2000) and Chung et al. (2016), the materials comprise 75% of the total battery

cost. For this reason, we assume that production costs equals 25% of the total cost. Since the cost

of LIBs have constantly decreased in the last years due to improvements in the production pro-

cesses, we assume an ulterior reduction of 25% of the production cost for a LIB. Therefore the

cost is defined as 2,500 $/battery.

The second production policy occurs at the recycling plant and is based on the BOM “reverse

lithium”. The recycling process uses from 30% to 70% of the energy necessary for the primary

production process and recovers from 50% to 95% of the lithium. Furthermore, Toxco is one of

the most advanced recycling plants of the world. For these reasons, we assume a lithium recov-

ery rate of 80% and an energy consumption of 40% compared to the battery primary production.

The recycling plant spends $1,000 to recycle a single LIB and recover 48 kg of lithium. For the

production of a single LIB, a hypothetical negligible time of 5 minutes (0.0035 [days/batteries])

is assumed.

4.3. Performance indicator computation

For SC performance analysis, three groups of KPI have been considered: financial, customer and

operational. Financial performance is measured by revenues and profits. For profit computation,

the following costs have been considered: lithium purchase costs, transportation costs, fixed

warehousing costs, outbound processing costs at the DCs, manufacturing costs and fixed operat-

ing costs at Gigafactory, inventory holding costs at the DCs, and the LIB price. Customer per-

formance has been measured using service level KPIs and the number of arrived and in-time
orders. An order is considered as an in-time order if it has been delivered in accordance with the

expected lead-time to the customer. Two service levels, i.e., alpha service level and ELT (ex-

pected lead time) service level have been computed. Alpha service level depicts the probability

that all customer orders arriving within a given time interval will be completely delivered from

stock on hand, i.e. without delay. ELT service level depicts the ratio of orders delivered within

“Expected lead time” to total number of orders. Note that in alpha service level, no backlog is

considered. If an SC can’t fulfil the order, the order is rejected. The ELT service level takes into

account backlog and transportation time to the customer. Operational performance has been

computed in regard to inventory dynamics, inventory on-stock and backlogs.

4.4. Disruption and recovery scenarios

SC performance impact is analysed when a disruption occurs in the reverse SC at the collection

point North. SC performance is analysed without and with recovery policies for disruption im-

pact mitigation. It is assumed that, once the disruption has occurred, the collection point North

remains disrupted for all the remaining periods of analysis. The reason for this choice is to ana-

lyze the different effects of the recovery policies over a long period of time. For the reactive re-

covery policy “Transportation Management”, the collection point South receives part of the bat-

teries shipped by the reverse customers north. The aim of this policy is to reduce the amount of

batteries disposed to avoid the resulting high financial losses. In this way, increases in the

amount of lithium at the recycling plant favor recycling by increasing shipment quantities from

the recycling plant. For the reactive recovery policy “Backup Collection Point”, we introduce a

back-up DC that can handle the flows that would have been directed to the disrupted collection

point North but at higher costs.

5. Experimental analysis and managerial insights

In this Section, the results of several simulations runs in anyLogistix are presented. We first de-

scribe the results obtained in the normal state when no disruption occurs. Subsequently, the dis-

rupted scenarios with and without recovery policies are analysed.

5.1 Normal mode performance analysis

5.1.1. Operational performance

In Fig. 4, an overview of shipped and received lithium is presented.

1600000
Lithium Shipped [pz]
1500000
1400000
1300000
1200000
1100000
1000000
900000
800000
700000
600000
500000
400000
300000
200000
100000
0
120

350
0
10
20
30
40
50
60
70
80
90
100
110

130
140
150
160
170
180
190
200
210
220
230
240
250
260
270
280
290
300
310
320
330
340

360
DC supplier Recycling Plant Lithium supplier days

Fig. 4. Overview of shipped and received lithium

It can be observed in Fig. 4 that the improvement in the recycling processes permits Tesla Mo-

tors to achieve an extremely high recovery rate of lithium. This appears clearly from the compar-

ison of the number of items shipped by the recycling plant and the DC. In this scenario, the com-

pany can satisfy more than a half of the production requests at the Gigafactory with recovered

lithium obtained from the recycling plant. The inventory dynamics at LIB level is shown in Fig.

5.
5100
LIBs Inventory [pz]
4800
4500
4200
3900
3600
3300
3000
2700
2400
2100
1800
1500
1200
900
600
300
0
0
10
20
30
40
50
60
70
80
90
100
110
120
130
140
150
160
170
180
190
200
210
220
230
240
250
260
270
280
290
300
310
320
330
340
350
360
CollectionPointNorth CollectionPointSouth Gigafactory Main DC Recycling Plant days

Fig 5: LIB available inventory (normal-state scenario)

Fig. 5 depicts the LIB available inventory at the main DC, collection DCs, recycling plant, and

Gigafactory. It can be observed from Fig. 5 that both main DC and Gigafactory operate without

backlog. The normal operation of both collection DCs in the reverse SC enable regular ship-

ments to the recycling plant. The observed inventory dynamics could also suggest the importance

of increasing the LIBs’ recovery rate and the possibility of storing some quantity of batteries as a

strategic stock to avoid possible shortages in case of disruptions.

5.1.2. Customer performances

In Table 5, performance on the customer side is summarized.

Table 5 Customer performance in normal-state scenario

Orders Ar-
Customers Total Orders rived In-time Orders SLα SLELT
Berlin 52 52 52 1 1
Bremen 52 51 51 1 1
Dortmund 52 51 51 1 1
Dresden 52 51 51 1 1
Dusseldorf 52 52 52 1 1
Essen 52 51 51 1 1
Frankfurt am Main 52 51 51 1 1
Hamburg 52 52 52 1 1
Hannover 52 51 51 1 1
Cologne 52 51 51 1 1
Leipzig 52 51 51 1 1
Munich 52 51 51 1 1
Nuernberg 52 51 51 1 1
Stuttgart 52 51 51 1 1

It can be observed from Table 5 that service level equals 100% and average lead time is between

1 and 4 days.

5.1.3. Financial performance

In normal-state scenario, revenue is $788,573,444 and total profit is $337,349,780.

5.2. Disrupted Scenario

5.2.1. Operational Performance

In Figs 6 and 7, the performance impact in the disruption scenario (i.e., disruption at the collec-

tion point North) is depicted.

190000 Lithium Inventory [pz]
180000
170000
160000
150000
140000
130000
120000
110000
100000
90000
80000
70000
60000
50000
40000
30000
20000
10000
0
70

240

330
0
10
20
30
40
50
60

80
90
100
110
120
130
140
150
160
170
180
190
200
210
220
230

250
260
270
280
290
300
310
320

340
350
360
DC supplier Gigafactory Recycling Plant days

Fig 6: Lithium available inventory (disrupted scenario)

5100 LIBs Inventory [pz]

4800
4500
4200
3900
3600
3300
3000
2700
2400
2100
1800
1500
1200
900
600
300
0
0
10
20
30
40
50
60
70
80
90

250
100
110
120
130
140
150
160
170
180
190
200
210
220
230
240

260
270
280
290
300
310
320
330
340
350
360

CollectionPointNorth CollectionPointSouth Gigafactory days

Fig 7: LIB available inventory (disrupted scenario)

Due to the disruption, the amount of batteries received at the recycling plant is significantly re-

duced as shown by the reduced number of orders received. This causes a consequent reduction in
the amount of lithium produced as compared to the normal-state scenario. To ensure the produc-

tion capability, the Gigafactory must compensate for this difference of lithium by acquiring addi-

tional materials from the supplier with increasing material purchasing costs. Furthermore, the

LIBs shipped by the reverse customers North are redirected to the disposal centre. These batter-

ies are then disposed with extremely high costs and waste of material.

It can be further observed that the level of lithium at the recycling plant starts to drastically drop

once the disruption has occurred, which leads to large orders to supplier. Despite the fact that the

model assumes that the lithium supplier has an infinite amount of lithium available, it is possible

to see how, immediately after the disruption (day 60), the average amount of lithium at the Gi-

gafactory starts to decrease. Furthermore, around day 140, the chart assumes an irregular trend

with great variations in value and the average amount of lithium starts to decrease. This may be

seen in the several minimum peaks, far below the re-order point, which start to appear on day

220. These sudden variations are likely to make it more difficult for the company to plan the

production in the Gigafactory. Furthermore, an eventual disruption at the supplier could lead to

the Gigafactory lacking raw material and to a consequent incapability of production.

5.2.2. Customer performances

Despite the disruption and the problems in the inventory control area pointed out in Sect. 5.2.1,

the company is still able to maintain the promised service level of 100%. This indicates that the

SC design is robust.

5.2.3 Financial Performances

Table 6 presents the financial performance in the SC in disrupted scenario.

Table 6. Financial performance in the SC in disrupted scenario

Scenario Revenue Profit

TOTAL 768211947 297332637

TOTAL in disruption-free scenario 788573444 337349780

Due to the lack of recycling in the disrupted scenario, there is a decrease of $40,017,143 of total

profit compared to the normal-state scenario. In order to prevent this extremely high loss, it is

necessary to plan some recovery actions.

5.3. Reactive Recovery Policy - Transportation Management

In this scenario, the Collection Point South receives part of the batteries shipped by the reverse

customers north. The aim of this policy is to reduce the number of batteries disposed to avoid the

resulting high financial losses. Due to the increased inventory at the Collection Point South, a

revision of the inventory control policy at the recycling plant for the LIBs was necessary. Com-

pared to the normal-state scenario, the re-order quantity Q after the disruption has been increased

from 920 to 1100 LIB. Increases in the amount of lithium at the recycling plant favor, in this

way, recycling by increasing shipment quantities from the recycling plant (Fig. 8).

5.3.1. Operational Performances

190000 Lithium Inventory [pz]

180000
170000
160000
150000
140000
130000
120000
110000
100000
90000
80000
70000
60000
50000
40000
30000
20000
10000
0
99

275
0
11
22
33
44
55
66
77
88

110
121
132
143
154
165
176
187
198
209
220
231
242
253
264

286
297
308
319
330
341
352
363

DC supplier Gigafactory Recycling Plant days

Fig. 8: Lithium available inventory (recovered scenario-transportation policy)

It can be observed from Fig. 8 that despite the evolution of the inventory levels is not as good as

the one in the normal-state scenario, the level of lithium at both the Gigafactory and recycling

plant is much higher compared to the disrupted scenario and there is no trace of the sudden peaks

of minimum/maximum observable in Fig 6.

5400
LIBs Inventory [pz]
5100
4800
4500
4200
3900
3600
3300
3000
2700
2400
2100
1800
1500
1200
900
600
300
0
110

230

350
0
10
20
30
40
50
60
70
80
90
100

120
130
140
150
160
170
180
190
200
210
220

240
250
260
270
280
290
300
310
320
330
340

360
CollectionPointNorth CollectionPointSouth Gigafactory Main DC Recycling Plant days

Fig 9: LIB available inventory (recovered scenario-transportation policy)

An increased number of LIBs at the Collection Point South the new transportation policy can

consequently be observed in Fig. 9. It is also important to notice how low the number of LIBs at

the recycling plant is. This indicates a shortage of batteries, which are immediately used in the

production of lithium once they arrive in the plant.

5.3.2. Financial Performances

Table 7 presents the financial performance in the SC in disrupted scenario and the recovery ac-

tion “New transportation policy”.

Table 7. Financial performance in the SC in disrupted scenario and the recovery action “New

transportation policy”
 Scenario Revenue Profit

Disruption scenario 768211947 297332637

Disruption-free scenario 788573444 337349780

Disruption scenario and recovery policy 1 772214900 310974889

Table 6 depicts clearly how the implementation of a recovery policy permits a substantial in-

crease in system performances and avoids a loss of $13,642,252, as compared to the disrupted

scenario. The financial loss of $26,374,891 compared to the normal-state scenario provides clear

evidence of the necessity of avoiding the wastes of batteries due to a lack of recycling.

5.4. Proactive Recovery Policy - Backup Collection Point

5.4.1. Operational Performances

5100 LIBs Inventory [pz]

4800
4500
4200
3900
3600
3300
3000
2700
2400
2100
1800
1500
1200
900
600
300
0
170

350
0
10
20
30
40
50
60
70
80
90
100
110
120
130
140
150
160

180
190
200
210
220
230
240
250
260
270
280
290
300
310
320
330
340

360

Backup Collection Point Collection Point North Collection Point South

Gigafactory Main DC Recycling Plant
days

Fig 10: LIB available inventory (recovery scenario - Backup Collection Point)

Thanks to the Backup Collection Point (Fig. 10), the current operational performance is very

similar to the one of the normal-state scenario. It is important to focus on the lithium shipped by
the recycling plant. This proves the effectiveness of this recovery policy for favoring the recy-

cling of the batteries and avoiding waste of material.

5.4.2. Financial performance

Table 8 presents the financial performance in the SC in the disrupted scenario and recovery ac-

tion “Backup collection point”.

Table 8. Financial performance in the SC in the disrupted scenario and the recovery action

“Backup collection point”

Scenario Revenue Profit

Disruption scenario 768211947 291053787

Disruption-free scenario 788573444 337349780

Disruption scenario and recovery policy 1 772214900 307793389

Disruption scenario and recovery policy 2 780114420 289105422

As we might expect, the backup collection point is extremely expensive and has a strong impact

on the financial performances of the company in the period of analysis. It may be pointed out

that, compared to the disrupted scenario, the total profit is lower and this could lead to the con-

clusion that this recovery policy is not effective. However, it must also be considered that, while

the expense for the realization of the backup collection point occurs only once, the expense for

the batteries disposal continues repeatedly over the time. Due to the backup collection point, it is

possible to achieve considerable savings because of the increased recycled LIB number and the

consequent reduction in inventory costs.

6. Conclusions

In this paper, we studied the impact of disruptions on SC performance in the closed-loop SC with

the help of discrete-event simulation for the first time. More specifically, the objective and con-
tribution of this study is to develop an approach to analyse the disruptions in the reverse part of

an automotive CLSC for electric cars (e.g., a temporary unavailability of a warehouse for collect-

ing the used LIBs for electric cars) in regard to (i) their impact on overall SC performance as

well as to the (ii) proactive and reactive policies with considerations towards inventory control

policies and sustainable manufacturing concepts.

CLSC management is vital in the e-mobility era where lithium batteries play an increasing role

in e-cars. At the same time, risk management and resilience in SCs become more and more im-

portant in research and practice. Combining these two perspectives, this paper contributes to the

existing literature by disruption analysis in the CLSC with the use of simulation and application

of the anyLogistix simulation tool in the CLSC analysis. On the basis of a hybrid case study–

simulation methodology, this research aimed at analyzing six-stage closed-loop SC of Tesla from

the positions of resilience and sustainability. Based on the secondary data, an example for the

German market has been created and investigated with the help of discrete-event simulation.

More specifically, the results help to show how a disruption in the reverse SC may affect the

financial and operational performances of the company. Two recovery policies in regard to an

alternative transportation policy and a back-up collection point have been simulated in order to

analyze their capability of recovering the SC from disruption and restoring its operation and per-

formance.

It has been observed that disruption in the reverse SC (i.e., at the LIB collection point) signifi-

cantly reduces SC performance both at operational and financial levels. Two reactive recovery

policies have been subsequently considered. The findings suggest that the recovery plan with the

new transportation policy appears more efficient for small-scale and short-duration disruptions

and for disruptions that do not completely shut down a site. In this way, the flows of disposed
batteries are not too high and the related costs are low. It is also possible to avoid the high ex-

penses for the backup collection point. The backup collection point recovery strategy appears

efficient only for long-lasting disruptions that entirely shut down one or more sites (e.g., due to a

natural disaster)

As a limitation of this study, we point out that the model only focused on the Tesla German mar-

ket under some assumptions made on the basis of secondary data sources. However, by also con-

sidering other countries and their markets, it is logical to assume increased LIB flows. In this

case, it would be possible to build a larger DC that serves as a backup collection point not only

for Germany but also for nearby countries (e.g. Germany-Poland-Czech Republic; or Germany-

North Italy - Austria) depending on the facility location. Analysis of this hypothesis could be an

interesting future research avenue.

Acknowledgement
The author thanks three anonymous reviewers for their valuable comments that greatly improved
the manuscript. We also thank Ms. Meghan Stewart, the master student in the “Global Supply
Chain and Operations Management” program at Berlin School of Economics and Law for a thor-
ough proof-reading of this manuscript.
References

Ambulkar, S., Blackhurst, J., & Grawe, S. (2015). Firm's resilience to supply chain disruptions:

Scale development and empirical examination. Journal of Operations Management, 33(34),

111–122.

Analisi dei costi nei trasporti (2012, November 13). IUAV-Istituto Universitario di Architettura

di Venezia. Retrievable from http://www.iuav.it/Ateneo1/docenti/architettu/docenti-st/Agostino-

C/materiali-/2015---201/7.-COSTI-DEL-TRASPORTO.pdf (Visited on 2017, February 25).

AssoElettrica. (2014). Auto elettrica e batterie, la Tesla comincia a pensare in grande. Retrie-

vable from http://www.assoelettrica.it/blog/?p=9428 (Visited on 2016, November).

Azzi A, Battini D, Faccio M, Persona A, Sgarbossa F. (2014). Inventory Holding Costs Meas-

urement: a multi-case study. The International Journal of Logistics Management, 25(1), 109-132.

Basiri, Z., and J. Heydari. (2017) "A mathematical model for green supply chain coordination

with substitutable products." Journal of Cleaner Production 145, no. C (2017): 232-249.

Battini D, Persona A., Sgarbossa F. (2014). A sustainable EOQ model: Theoretical formulation

and applications Int. J. Production Economics, 149, 145- 153.

Battini D., Bogotaj M., Choudhary A., (2017). Closed Loop Supply Chain (CLSC): Economics,

Modelling, Management and Control. Int. J. Production Economics, Volume 183, Part B, Pages

319–321.

Berdichevsky, G., Kelty, K., Straubel, J. B., & Toomre, E. (2006). The Tesla Roadster Battery

System, Tesla Motors.

Burdzik, R., Cieśla, M., & Sładkowski, A. (2014). Cargo Loading and Unloading Efficiency

Analysis in Multimodal Transport. PROMET-Traffic&Transportation, 26(4), 323-331.

Carvalho, H., Barroso, A. P., Machado, V.H., Azevedo, S., & Cruz-Machado, V. (2012). Supply

chain redesign for resilience using simulation. Computers & Industrial Engineering, 62(1), 329–

341.

Chaharsooghi SK., Heydari J., Kamalabadi IN (2011). Simultaneous coordination of order quan-

tity and reorder point in a two-stage supply chain. Computers & Operations Research, 38(12),

1667–1677.

Chen, Y. T., Chan, F. T. S., & Chung, S. H. (2015). An integrated closed-loop supply chain

model with location allocation problem and product recycling decisions. International Journal of

Production Research, 53(10), 3120-3140.

Cheng, L. C., Thompson, B., & Flosi, D. (2013). Supply Chain Resilience to Enhance Risk Man-

agement for Competitiveness. Journal of International Management Studies, 13(4), 27-36.

Choi, T.M. Inventory Service Target in Quick Response Fashion Retail Supply Chains. IN-

FORMS Service Science, 8, 406-419, 2016.

Choi, T.M. Optimal Return Service Charging Policy for Fashion Mass Customization Program.

INFORMS Service Science, 5, 56-68, 2013.

Chopra, S., Reinhardt, G., & Mohan, U. (2007). The importance of decoupling recurrent and

disruption risks in a supply chain. Naval Research Logistics, 54(5), 544–555.

Chung, D., Elgqvist, E., & Santhanagopalan, S. (2016). Automotive Lithium-ion Cell Manufac-

turing: Regional Cost Structures and Supply Chain Considerations. Contract, 303, 275-3000.

Clean Technica (2016). 91,000 Electric cars sold in Europe in the first half of 2016 (charts). Re-

trievable from https://cleantechnica.com/2016/08/20/91000-electric-cars-sold-europe-1st-half-

2016-charts/ (Visited on 2017, February).

CNBC (2016). Sustainable Energy Special Report – Sales of electric vehicles in Europe double:

Research. Retrievable from http://www.cnbc.com/2016/10/13/sales-of-electric-vehicles-in-

europe-double-report.html (Visited on 2017, February 23).

Eccheli, M., [LA STAMPA MOTORI] (2016). Germania, un miliardo di incentivi per le auto

elettriche. Obbiettivo 500,000 su strada entro il 2020. Retrievable from

http://www.lastampa.it/2016/04/27/motori/ambiente/germania-un-milione-di-incentivi-per-le-

auto-elettriche-obiettivo-su-strada-nel-pQS9NMGEHMpDumDHbrVj2K/pagina.html (Visited

on 2017, February).

EdgarOnline. (2016). Tesla Motors Inc – Form 10K (Annual Report). Retrievable from

http://ir.tesla.com/secfiling.cfm?filingid=1564590-16-13195&cik=
Fahimnia, B., Tang, C. S., Davarzani, H., & Sarkis J. (2016). Quantitative Models for Managing

Supply Chain Risks: A Review. European Journal of Operational Research, 247(1), 1-15.

Feng, L., Govindan, K., Li C. (2017). Strategic planning: Design and coordination for dual-

recycling channel reverse supply chain considering consumer behavior. European Journal of Op-

erational Research, 260(2), 601-612.

Gaines, L., & Cuenca, R., (2000). Costs of Lithium-Ion batteries for vehicles. Center for Trans-

portation Research, Energy System Division, Argonne National Laboratory, Illinois. 1-53

Gaines, L., Sullivan, J., Burnham, A., & Belharouak, I. (2011). Life-cycle analysis for lithium-

ion battery production and recycling. In Transportation Research Board 90th Annual Meeting,

Washington, DC (pp. 23-27).

Giutini, R., & Gaudette, K. (2003). Remanufacturing: The next great opportunity for boosting

US productivity. Business Horizons, 46(6), 41-48.

Govindan, K., Soleimani, H., & Kannan, D. (2015). Reverse logistics and closed-loop supply

chain: A comprehensive review to explore the future. European Journal of Operational Re-

search, 240(3), 603-626.

Guide Jr, V. D. R., & Van Wassenhove, L. N. (2009). The evolution of closed-loop supply chain

research. Operations research, 57(1), 10-18.

Habermann, M., Blackhurst, J., & Metcalf, A. Y. (2015). Keep your friends close? Supply chain

design and disruption risk. Decision Sciences, 46(3), 491-526.

Hasani, A., Zegordi, S. H., & Nikbakhsh, E. (2012). Robust closed-loop supply chain network

design for perishable goods in agile manufacturing under uncertainty. International Journal of

Production Research, 50(16), 4649-4669.

Heydari J. (2014). Lead time variation control using reliable shipment equipment: An incentive

scheme for supply chain coordination. Transportation Research Part E: Logistics and Transporta-

tion Review, 63, 44-58.

Heydari, J, K Govindan, and A. Jafari. (2017) "Reverse and closed loop supply chain coordina-

tion by considering government role." Transportation Research Part D: 52, Part A : 379-398.

Heydari, J., and Ja. Asl-Najafi. (2016) "Coordinating inventory decisions in a two-echelon sup-

ply chain through the target sales rebate contract." International Journal of Inventory Research 3,

no. 1, 49-68.

Hishamuddin, H., Sarker, R. A., & Essam, D. (2015). A simulation model of a three-echelon

supply chain system with multiple supplier subject to supply and transportation disruption.

IFAC-PapersOnLine 48-3, 2036–2040.

Hu, B., & Kostamis, D. (2015). Managing supply disruptions when sourcing from reliable and

unreliable suppliers. Production and Operations Management, 24(5), 808-820.

Hummels, D. (2007). Transportation costs and international trade in the second era of globaliza-

tion. The Journal of Economic Perspectives, 21(3), 131-154.

Ivanov D., Pavlov A., Pavlov D., Sokolov B. (2017b). Minimization of disruption-related return

flows in the supply chain, International Journal of Production Economics, 183, 503-513

Ivanov, D., (2017). Simulation-based ripple effect modelling in the supply chain. International

Journal of Production Research, 55(7), 2083-2101.

Ivanov, D., Dolgui A., Sokolov B., Ivanova M. (2017c). Literature review on disruption recovery

in the supply chain. International Journal of Production Research, in press.

Ivanov, D., Dolgui, A., Sokolov, B., & Ivanova, M. (2016). Disruptions in supply chains and

recovery policies: state-of-the art review. IFAC-Papers Online, 49(12), 1436-1441.

Ivanov, D., Sokolov, B., & Dolgui, A. (2014). The Ripple effect in supply chains: trade-off ‘effi-

ciency-flexibility-resilience in disruption management. International Journal of Production Re-

search, 52(7), 2154-2172.

Ivanov, D., Tsipoulanidis, A., & Schönberger, J. (2017a). Global Supply Chain and Operations

Management. Springer Text in Business and Economics, ISBN 978-3-319-24215-6

Jeihoonian, M., Zanjani, M. K., & Gendreau, M. (2017). Closed-Loop Supply Chain Network

Design under Uncertain Quality Status: Case of Durable Products. International Journal of Pro-

duction Economics, 183, 470-486.

Jeong-Eun, L., & Kang-Dae, L. (2013). Modelling and optimization of closed-loop supply chain

considering order or next arrival of goods. International Journal of Innovative Computing, In-

formation and Control, 9(9), 3639-3655.

Kaynak, R., Koçoğlu, İ., & Akgün, A. E. (2014). The role of reverse logistics in the concept of

logistics centers. Procedia-Social and Behavioral Sciences, 109, 438-442.

Lewis, B. M, Erera, A. L., Nowak, M. A., & White, C. C., III (2013). Managing inventory in

global supply chains facing port-of-entry disruption risks. Transportation Science, 47(2), 162–

180.

Lupi, M., (2012). Corso di Tecnica e dei Trasporti – Trasporti Aerei, PARTE B. Lezione di Cor-

so di Tecnica e dei Trasporti, Facoltà di Ingegneria, Università di Pisa, Italia. Retrievable from

http://www2.ing.unipi.it/~a006048/trasporti_aerei_parteB_pisa_11-12_210412.pdf (Visited on

2017, February).

Macdonald, J. R., & Corsi, T. M. (2013). Supply chain disruption management: severe events,

recovery, and performance. Journal of Business Logistics, 34(4), 270-288.

Nelson, P. A., Bloom, K. G., & I Dees, D. W. (2011). Modeling the performance and cost of

Lithium-Ion batteries for electric-drive vehicles. (No. ANL-11/32). Argonne National Laboratory

(ANL), Argonne, IL (United States). Available from http://www.osti.gov/bridge.

Rezapour, S., Farahani, R.Z., Fahimnia, B., Govindan, K., Mansouri, Y. (2015). Competitive

closed-loop supply chain network design with price-dependent demands. Journal of Cleaner Pro-

duction, 93, 251-272.

Schmitt, A. J., & Singh, M. (2012). A quantitative analysis of disruption risk in a multi-echelon

supply chain. International Journal of Production Economics, 139(1), 23–32.

Snyder, L. V., Atan, Z., Peng, P., Rong, Y., Schmitt, A. J., & Sinsoysal, B. (2016). OR/MS mod-

els for supply chain disruptions: A review. IIE Transactions, 48(2), 89-109.

Spiegler, V. L., Naim, M. M., & Wikner, J. (2012). A control engineering approach to the as-

sessment of supply chain resilience. International Journal of Production Research, 50(21), 6162-

6187.

Świerczek, A. (2013). An identification of the" rippling effect" in the transmission of disruptions

in supply chains. The dilemmas of theoretical study and empirical research. Journal of Econom-

ics & Management, (12), 83-96.

Tang, C. S. (2006). Perspectives in supply chain risk management. International Journal of Pro-

duction Economics, 103: 451-488.

Tesla Motors Club (2016). Tesla European Registration Stats. Retrievable from

https://teslamotorsclub.com/tmc/threads/tesla-europe-registration-stats.61651/ (Visited on 2017,

February 23).

Tesla Motors. (2016). Tesla. Retrievable from https://www.tesla.com (Visited on 2016, Novem-

ber).
 USGS. (2012). Mineral Commodity Summaries 2012. U.S. Geological Survey.

Wang, X., Gaustad, G., Babbitt, C. W., & Richa, K. (2014). Economies of scale for future lithi-

um-ion battery recycling infrastructure. Resources, Conservation and Recycling, 83, 53-62.

WIRED. (2016). This is the enormous Gigafactory, where Tesla will build its future. Retrievable

from https://www.wired.com/2016/07/tesla-gigafactory-elon-musk/ (visited on 2017, February

8).

Xu, J., Thomas, H. R., Francis, R. W., Lum, K. R., Wang, J., & Liang, B. (2008). A review of

processes and technologies for the recycling of Lithium-Ion secondary batteries. Journal of Pow-

er Sources, 177(2), 512-527.

Yuan, K. F., Ma, S. H., He, B., & Gao, Y. (2015). Inventory decision-making models for a

closed-loop supply chain system with different decision-making structures. International Journal

of Production Research, 53(1), 183-219.

Zhou, L., Naim, M. M., & Disney, S. M. (2017). The impact of product returns and remanufac-

turing uncertainties on the dynamic performance of a multi-echelon closed-loop supply

chain. International Journal of Production Economics, 183 (Part B), 487-502.

View publication stats