A capacity planning model for TFT-LCD production networks

Abstract

The paper presents a capacity planning model for TFT-LCD production network. The capacity planning decision of TFT-LCD manufacturing is to simultaneously seek an optimal capacity allocation plan and capacity expansion policy. Capacity allocation decides on profitable product mixes and allocated production quantities of each product group at each production site. Capacity expansion concerned with determining the timing, types and sizes of capacity investments, especially in the procurement of new bottleneck machines and acquisition of new auxiliary tools. This study proposes a mixed integer linear programming (MILP) to formulate the capacity planning problem which considers many practical characteristics of TFT-LCD manufacturing such as multi-generation & multi-site production network, two capacity types, economic cutting ratio, and high capacity expansion costs. Finally, a case study modified from a Taiwan TFT-LCD manufacturer is illustrated.