Magna Powertrain - achieving 20% product cost optimisation of a transfer case

Four years prior to the start of production, estimated product costs of the transfer case were above budget. Due to the high annual quantity and different variants, savings of at least 10% of the actual cost had to be realised to ensure profitability of the project. PA conducted a benchmarking project comparing five competitor transfer cases and transferring all relevant best practice to the new design.

After the first three phases potential cost savings of 20% were identified. After the first six months of the implementation phase - supported by PA - savings of 12% were achieved by the project. The transparency of cost and results could be used as basis for supplier negotiations in order to realise further savings.

To find out how PA can realise product cost optimisation in your business, please contact us now.