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Terex - Using value engineering to deliver short term cost reduction and embedded learning for the future

This project focused on the TA30 articulated truck and involved the creation of a Terex project team drawn from engineering, purchasing and finance, with support from other functions such as marketing and logistics, as appropriate.

The project had three main objectives as described by Paul Douglas of Terex:

“To reduce the manufacturing cost of the TA30; to identify opportunities for reducing cost on other models, now and in the future; and to learn, deploy and retain best practice value engineering – which is something Terex is looking to develop.”

“The pricing of our products has to remain competitive and retain margin. In order to do this, we have to drive costs down, without any negative impact on the quality of our product. The cost of the product had crept up partly because the design hadn’t changed significantly over the years and also due to other various factors such as oil and steel price increases, and ensuring compliance with changing noise and emissions legislation.”

“Over time, the gap between the selling price and the cost had narrowed and hence the margin had reduced; we were making less and less profit from our machines and that trend needed to be reversed.”

Get the full article on our work with Terex

To find out more about value engineering, please contact us now.

Contact
Mark Humphries
Product development and manufacturing
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