Factories Grapple

Factories Grapple - Factories Grapple With How Fast to Ramp...

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Factories Grapple With How Fast to Ramp Up By Kris Maher 21 June 2010 The Wall Street Journal Timken Co. stands at a crossroads, along with thousands of other manufacturers gearing up for recovery, trying to decide which orders it can fill without overextending itself, and raising anxiety among some customers who might be left out. "Everyone wants to ramp up," says Mike Arnold, executive vice president of the company's bearings and power-transmission group. "But nobody wants to overcapitalize," he says. "It's a very tough call." Any mistakes could be costly. Bringing idled capacity back online too quickly can damp prices, as is beginning to happen in the steel industry. Yet opening the spigot too slowly can lead to shortages, forcing companies to put workers on overtime or otherwise scramble to placate customers. Corning Inc., which slashed its inventory during the recession, was caught off guard recently when brisk auto sales fueled demand for its emissions-control filters and devices.To supply its Asian clients as quickly as possible, Corning has had to pay substantially more to ship the parts by air, rather than sea. Manufacturers caught in a similar bind have fueled a boom in FedEx Corp.'s premium international air-delivery service. Tight industrial capacity has forced many companies to trade up to the service to ensure timely deliveries to foreign customers, FedEx said last week. Companies were quick to lay off workers, idle factories and sell unprofitable businesses
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This note was uploaded on 01/30/2011 for the course 620 300 taught by Professor Gordon during the Spring '10 term at Rutgers.

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Factories Grapple - Factories Grapple With How Fast to Ramp...

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