Scania Annual Report 2011

production
37
High standards of
flexibility
Short, stable delivery times mean that customers
can swiftly put products into operation. This imposes
high standards of flexibility at Scania. High quality
is crucial for product functionality and performance.
Quality is also the key to productivity at Scania,
enabling it to apply sustainable production methods.
Because of its common product and production system,
Scania’s production network is globally integrated. The same
working methods and quality standards mean that production
can be allocated flexibly between Europe and Latin America to
achieve optimal capacity utilisation.
Through the Scania Production System (SPS), Scania works
with continuous improvements to boost efficiency and flexibility,
and to eliminate environmental waste as well as waste of time
and materials.
A new globally coordinated organisation for safety, health,
working environment and environmental activities was established
late in 2010. The goal is to ensure that Scania operates
as a sustainable organisation. These efforts are integrated into
day-to-day operations and include continually working to ensure
safer workplaces and improve well-being in the company, while
minimising Scania’s environmental impact.
Flexible production with a high level of service
Since 2010 Scania has worked with short, stable delivery times
of six to eight weeks from customer order to truck delivery in
Europe. This enables customers to quickly start using the company’s
products. Starting in autumn 2011, the same system has
been applied to bus and coach production in Europe.
Applying short, stable delivery times requires a high degree
of flexibility at Scania, since the production network must
quickly adapt to actual demand as order bookings change. One
advantage of this working method is that Scania avoids building
up sizeable order books, thereby minimising the risk of large
inventories of unsold vehicles.
Demand for vehicles fluctuates with market conditions. This
has been apparent in recent years. A very severe downturn in
2009 was followed by a rapid upturn in 2010 and 2011. After
production remained at a high, stable level during most of 2011,
a slowdown in demand occurred in various markets late in the
year. This prompted Scania to reduce its vehicle production rate
in two steps. In November 2011, Scania lowered daily production
on a global basis by about 15 percent compared to the end
of the third quarter. Starting in January 2012, the daily production
rate was lowered by another 15 percent. As part of this
adjustment, nearly 1,900 employees are affected by not having
their fixed term temporary contracts renewed.
Report of the directors Scania 2011