30 Jun Network Optimization SCM/Ops Question
Question Description
PROTRAC is a manufacturer of diesel engines that has four assembly plants in Europe. They are located in Leipzig (Germany), Nancy (France), Liege (Belgium) and Tilburg (Netherlands). The engines parts come in kits from the United States for final assembly in Europe. The engines are shipped from the US to three ports: in Amsterdam (Netherlands), Antwerp (Belgium) and Le Havre (France). Upon arrival at the destination port, engines are shipped to the production plants.
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Demand at each Plant
Plant: Leipzig Nancy Liege Tilburg Total
# engines 400 900 200 500 2000
PROTRAC negotiated contracts for a set maximum volume at each port:
Max Supply of Engines
Port: Amsterdam Antwerp Le Havre Total
# engines 500 700 800 2000
The engines are transported by common carrier and charges are on a per-engine basis.
Cost to Transport an Engine from Port to Production Plant
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1) PROTRAC must decide how many engines to send from each harbor to each plant. Using solver in Excel determine the solution that would minimize cost for PROTRAC.
2) Realizing that they may need more flexibility in their network, PROTRAC negotiated with a fourth port located in Rotterdam. The shipping costs from Rotterdam are included below. They can ship up to 300 engines through Rotterdam, on top of the capacity already available at of other ports. Would this solution save money for PROTRAC? If so, how much? If not, how much more expensive is it?
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Conduct your computations in Excel using Solver. Please answer and question 1 and 2 into two separate worksheets. Submit your Excel file.
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