Evaluating and ensuring Heat Pump production reshoring in Europe

The mission

To successfully internalize heat pump production within Europe, we aim to develop a comprehensive strategy and cost evaluation.

• Develop and frame the strategy for internalizing heat pump production in Europe
• Conduct a comprehensive cost evaluation of the production process
• Gain detailed knowledge of all components involved
• Formulate a robust sourcing strategy

The challenges

• High maturity level costing achieved in one month
• Identify all opportunities to significantly reduce costs
• Sourcing of critical equipment components in times of shortage

The approach

• Catalog and categorize all parts to build a comprehensive Bill of Materials (BOM) structure.
• Reconstruct the cost structure, including detailed cost breakdowns, labor requirements, and transportation costs.
• Identify preliminary design-to-cost opportunities, sourcing scenarios, and make-or-buy alternatives.

The impacts

• Developed a complete internalization strategy based on in-depth component analysis.
• Characterized 150 components through reverse costing analysis
• Contacted 50 suppliers to establish a strong sourcing strategy