capacity utilization

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Capacity Utilization Rate

The extent to which a company uses its facilities at capacity, expressed as a percentage. That is, the capacity utilization rate states how much a company produces as a percentage of what it can produce. For example, if a factory produces 1,000 widgets per day but could produce 2,000 for the same cost, it has a capacity utilization rate of 50%. The capacity utilization rate is most useful for companies producing goods rather than services because goods are simply easier to quantify.

capacity utilization

the proportion of a firm's available CAPACITY which is currently being employed in producing output. This depends to a great extent on the state of demand and a firm's competitive abilities. A fall in demand, or a failure to win orders against competition, may force a firm to operate at below BREAK-EVEN levels of capacity utilization. See INDIVISIBILITIES, BUSINESS CYCLE, MACHINE UTILIZATION.
References in periodicals archive ?
Freight forwarders, on which container shipping companies depend, "make good use of the over-capacity, existing in all container line,s and succeed to negotiate the seafreight down to ridiculous and unsustainable low levels".
We do not expect that the problem of over-capacity in the non-life segment will disappear anytime soon: ERGO's acquisition of ATE.
This over-capacity problem was made all the worse by the crash itself, and in response there has been significant job cuts and plant closures in several countries.
The UAE Insurance Authority also voiced its concern on over-capacity and announced its desire to see mergers in the market.
The council says the proposals are being made to "address over-capacity, redirect resources, and progress the modernisation of the service.
When the tester is coupled with the company's Battery Pro software, customers gain access to flexible functions and programming that support rapid creation of test recipes for an individual channel or a group of channels To ensure safety, the 17200 offers protection features such as cell polarity check; overvoltage, overcurrent, and over-capacity monitoring; and loop (contacts and current path) resistance monitoring.
The automaker has taken this decision despite ongoing economic woes, increasingly expensive manufacturing costs and even as it aims to address over-capacity issues.
In addition to food prices, easing wholesale prices at the factory gate due to over-capacity in a few industries and waning imported inflation also explained the slowing CPI, Yao Jingyuan, a researcher from the Councilor's Office of the State Council, or China's Cabinet, was quoted by Xinhua as saying.
An over-capacity crowd of perhaps 10,000 gathered to mourn Leiby Kletzky, the eight-year-old Hasidic boy who was found dead in Brooklyn yesterday.
Paul Flint said: "Recent years have seen many companies in the printing sector battling hard in the face of over-capacity, pricing pressures and the effect of increased competition from low-cost overseas players.
The container shippers however face difficulty to raise fuel oil surcharge due to over-capacity, instead to avoid underselling in freightage to offset skyrocketing fuel oil expenditures.
This is part of China's push to limit over-capacity, and exists alongside efforts to limit future steel and the production of rare-earths used for things such as batteries.