High Costs of Downtime and Outsourcing Production Maintenance for Manufacturers

A recent survey of 101 manufacturing executives in the automotive industry, conducted by Nielsen Research for Advanced Technology Services, Inc. (ATS), reveals the staggering cost of downtime for manufacturers. The average cost of one minute of production downtime is $22,000, with some respondents citing costs as high as $50,000 per minute. In an effort to minimize downtime and improve productivity, a majority of executives would outsource production machine maintenance, with 53% citing this function as providing the most productivity gains.

Key Takeaways:

• The average cost of one minute of production downtime is $22,000, with some respondents citing costs as high as $50,000 per minute.
• A majority of executives (53%) would outsource production machine maintenance to improve productivity and minimize downtime.
• Other areas that manufacturers would outsource include tool room management and managing the spare parts storeroom.
• 70% of executives would outsource a certain department or job function if it meant they no longer had the responsibility for searching for and recruiting skilled workers.
• The cost of a shortage in skilled workers is estimated to be an average of $50 million per company, across the industry.
• ATS has pioneered the factory asset service business and is the leading company providing managed services for production equipment maintenance, industrial parts repair, and IT infrastructure support for manufacturers.
• ATS' recruitment and training program has fulfilled the need for a skilled workforce, and its white paper, The Guide to Increased Asset Performance Through Outsourcing Production Maintenance, provides guidance on increasing asset performance through outsourcing production maintenance.

Statistics:

• Average cost of one minute of production downtime: $22,000
• Maximum cost of one minute of production downtime: $50,000
• Percentage of executives who would outsource production machine maintenance: 53%
• Percentage of executives who would outsource a certain department or job function: 70%
• Estimated cost of a shortage in skilled workers: $50 million per company

Sources:

• "Advanced Technology Services, Inc. Pioneers Factory Asset Service Business; Research Reveals High Costs of Downtime for Manufacturers"
• Nielsen Research
• Advanced Technology Services, Inc. (ATS)
• PrimeZone via COMTEX
• www.advancedtech.com/theGuide
• www.primezone.com