📋 Case Study

Automotive Tier-1 Supplier – Die-Casting Cell Rate Harmonization

Divergent overhead allocations caused inconsistent profitability reporting by program

🏗️ Project Overview

Standardizing machine hour rates across 4 identical high-pressure die-casting cells serving multiple OEM programs

🎯 Challenge

Divergent overhead allocations caused inconsistent profitability reporting by program

🔧 Design Approach

Uniform facility cost apportionment using weighted floor space + thermal load modeling; shared tooling amortization schedule

📐 Design Diagram

AI-generated project design illustration

📐 Key Calculations

Thermal Load-Based Space Allocation

(Cell kW Rating / Total Plant kW) × Facility Cost

Result: USD 8.35/sq ft

Replaced flat sq-ft allocation

Tooling Amortization per Cavity-Hour

Tool Cost / (Cavities × Shot Count × Avg. Cycle Time)

Result: USD 1.22/hour

Aligned wear cost with actual usage intensity

📊 Results

Cross-program margin visibility improved by 95%; eliminated $1.2M/year in misallocated overhead

💡 Lessons Learned

• •Thermal load is a more accurate proxy than square footage for energy-intensive processes
• •Tooling should be tracked per cavity—not per machine

✅ Key Takeaways

• 1Thermal load is a more accurate proxy than square footage for energy-intensive processes
• 2Tooling should be tracked per cavity—not per machine