$\mathrm{X}$ Ltd manufactures and distributes three types of car (the $\mathrm{C} 1$, $\mathrm{C} 2$ and $\mathrm{C} 3$ ). Each type of car has its own production line.

The company is worried by extremely difficult market conditions, and forecasts losses for the forthcoming year.

It has been suggested by an external consultant, JIT ExtC Ltd, that a JIT system should be introduced to address these worries. Their communication reads as follows:

You receive the following email from the Chief Financial Officer (CFO):

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We have lots of experience in introducing Just-In-Time (JIT) measures in businesses similar to X Ltd. It is our view that many of X Ltd competitors have already introduced this type of JIT measures. We are certain that in order to remain competitive and achieve concrete cost savings, X Ltd should implement JIT measures as a matter of urgency. We estimate that the introduction of the JIT system would have the following impact on costs (fixed and variable): Direct labour Set-ups Increase by 20% Decrease by 30% Materials handling Decrease by 30% Inspection Decrease by 30% Machining Decrease by 15% Distribution and warehousing Eliminated