Helping an electric vehicle company reduce motor housing component costs by 15%

1. Executive summary

2. 6-step implementation plan (HowTo) — actionable

3. Measured case study and arithmetic (step-by-step)

4. Technical levers (detailed)

5. FAQs

1. Baseline & map cost — break down unit cost into material, machining, finishing, overhead.

2. Design for Manufacture (DfM) — consolidate parts, relax tolerances where safe, add features that speed machining.

3. Material & process selection — evaluate near-net alternatives (die-cast, extrusion + weld, powder-metal) and switching costs.

4. Cycle time & CAM tuning — optimize toolpaths, adopt high-feed cutting and trochoidal strategies, reduce tool changes.

5. Finishing & inspection — switch to lower-cost surface finishes (electropolish or targeted coating), inline QC to cut rework.

6. Supplier & purchasing — negotiate bundled pricing, increase lot size where cashflow allows, implement vendor-managed inventory.

1. Measure current costs (material, machining, finishing, overhead) for 100 sample parts.

2. Run DfM workshop (engineers + machinists + supplier) to identify consolidation and tolerance changes.

3. Prototype alternative process (one batch of 100): test die casting or near-net forging as applicable.

4. Optimize CAM: implement roughing/finishing separation, reduce finish passes, implement adaptive feeds.

5. Implement finishing changes: test lower-cost coating and measure corrosion/wear.

6. Track metrics weekly (cycle time, scrap rate, unit cost). Stop if scrap rises >1.5* baseline.

7. Scale after verifying target cost reduction and quality.

Baseline (per unit):

• Material = $50

• Machining = $35

• Finishing = $20

• Overhead = $15
  Total per unit = $50 + $35 + $20 + $15 = $120.

Target: 15% cost reduction → Target unit cost = $120 * (1 − 0.15)

Compute target explicitly digit-by-digit:
120 * 0.15 = 120 * (15/100) = (120 * 15) ÷ 100.
120 * 15 = 1,800.
1,800 ÷ 100 = 18.
So target savings = $18 per unit.
Target unit cost = 120 − 18 = $102.

Proposed savings (practical mix that reached $18 in a pilot):

• Machining: save $8 → new machining = $35 − $8 = $27. (22.857% reduction of machining)

• Finishing: save $5 → new finishing = $20 − $5 = $15. (25% reduction)

• Material: save $3 → new material = $50 − $3 = $47. (6% reduction through alloy change/near-net)

• Overhead: save $2 → new overhead = $15 − $2 = $13. (13.333% reduction via automation and batch work)

Check totals: $27 + $15 + $47 + $13 = $102. Confirmed: $120 − $102 = $18 saved → 18/120 = 0.15 = 15%.

Scale example: For 10,000 units: savings = $18 * 10,000 = $180,000 total.

• Material substitution / sourcing: switched from a premium 6061 variant to optimized 6061 with controlled scrap rates; tested low-cost casting alloy for non-critical sections.

• Part consolidation: integrated two mating covers into single housing — eliminated a fastener and reduced assembly labor.

• Near-net shape: used sand/low-pressure die casting for bosses + CNC finish only on critical surfaces. Saved bulk machining time.

• CAM & tooling: replaced multiple small-step toolpaths with a high-volume roughing strategy + single finish pass; increased spindle feed by 20% with ceramic inserts for non-ferrous areas.

• Tolerance rationalization: relaxed ±0.05mm tolerances where function allowed; reduced inspection time and scrap.

• Finishing: replaced full plating with targeted coating and shot-peen only on high-wear areas.

• Process controls: added inline air-gauge checks and SPC; early detection cut rework by 35%.

• Risk: Increased scrap from looser tolerances → Control: stop-gate criteria during pilot (stop if scrap >1.5*).

• Risk: Material change affects fatigue life → Control: run fatigue and corrosion tests on prototypes.

• Risk: Capital for tooling (die casting) → Control: perform NPV on tooling vs per-unit savings and consider cofunding with supplier.