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 ?
It now has around 50 per cent surplus capacity against the demand, which is around 12,000 megawatts.
We look at how collaborative platforms are unlocking value from surplus capacity.
How can we kill such an industry by encouraging importation of finished steel products when it has such a huge surplus capacity' he questioned.
"Early investigations by grid technicians identified between 25 and 70 MW of surplus capacity which feeds the local grid around Strichen and the National Grid in north-east Scotland."
The said that HIT wanted to utilize its surplus capacity for manufacturing of marketable products to promote its sales and provide services within the country and abroad.
While Mindanao grid is currently on a 'surplus capacity state', AC Energy of the Ayala group still sees the Kauswagan plant as a strategic investment because this could provide power to transmission assets that will serve as anchor to the Mindanao-Visayas Interconnection Project.
As the installed capacity of the power sector is rapidly increasing, the surplus capacity and losses are going to rise, and the sad state of the power sector will further worsen.
FortisBC will continue to operate the Waneta Expansion facility and purchase its surplus capacity.
To reduce the surplus capacity during off-peak times, he said the ministry was planning to offer cheaper fares to train passengers during 'non-peak' hours to optimise the use of the trains
Specifically, the market for railcars is extremely soft, he noted, "and this has driven the cost to carry surplus capacity down substantially."
The court was closed after the then Justice Secretary Michael Gove looked to cut down on "surplus capacity" in HM Courts and Tribunal Service.
'Five million tons is a surplus capacity,' the analyst said, adding it would take around five years to utilise this capacity.