FUYAO GLASS

AMERICA:
SOURCING
DECISION

PRESENTED BY :
GROUP 2
ABHINAV AKASH 1810003
ADHISH BHANDARI 1810005
JOYDEEP DATTA 1810026
SACHI KARIWALA 1810042
SONALI GUPTA 1810102
VAIBHAV RAJ 1810107
  Fuyao is the China’s No.1 and World’s No.2
automotive glass Manufacturer with 65% market
share in Chinese Passenger Vehicle OEM and 20%
market share globally.
 Being a highly profitable company ,it is always
welcomed by the local government.
CURRENT  Tianjin,China (One of its Most Modern Plant)
SCENARIO  Fuyao had three factories in U.S :
 Moraine,Ohio (Connected North U.S to South U.S)
 Mt.Zion,Illinios (Produced float glass)
 Plymouth,Michigan (Finishing Location and
Distribution Center to serve for customers JIT
supply chains)
CUSTOMERS
  Sourcing Strategy for a new contract to supply
an Ontario,Canada Factory belonging to a
PROBLEM North American Automaker.
STATEMENT  Whether to source from Tianjin,China OR
Moraine,Ohio
COST COMPARISON- TIANGIN VS MORAINE
SHIPPING AND TRANSPORT COST COMPARISON
 INVENTORY COST

Assuming weekly inventory carrying cost :

TOTAL PRODUCTION COST COMPARISON

AFTER PRODUCTION INCREASES TO 800 PAIRS AT BOTH THE LOCATIONS

PRODUCTION COST REDUCES AND HENCE THE TOTAL COST ALSO REDUCES.
  We recommend that the the outsourcing should
be done from Tianjin,China Factory.
 Even though total cost for Moraine will be lower
once the labour gets trained and produces 800
RECOMMENDATION material per shift and has 50 workers per line this
S plant should be used to fulfill the needs of US
customers.
 Trade war and volatility in tariffs is another
reason to save the production of Moraine for US
customers.
THANK
YOU