Your FPY is 75% – and no one is talking about it

An FPY of 75% means 25% of your parts undergo rework or end up as scrap. This is not an exception. It is reality in the automotive, charging infrastructure, shipbuilding, plastics, white goods, defense, bicycle and other industries.

Most quality managers are familiar with this figure. It appears in monthly reports. It is mentioned in meetings. But it is not addressed because rework is considered an unavoidable evil.

The problem: This 25% doesn’t just cost you time. It can increase your unit costs by up to 25% without your customer seeing any added value. And it ruins your sustainability balance sheet because every scrapped part wastes energy, material, and transport.

Mistakes happen. But what matters is how you deal with them.

What does poor quality cost?

Cost of Poor Quality (COPQ) in the manufacturing industry is 5–35% of sales. A company with sales of $250 million loses an average of $40 million annually due to errors, rework, and scrap. Professional sorting and rework processes reduce these costs by 20–30%

Rework vs. scrap: Why rework is the more sustainable option

A first pass yield of 75% means that a quarter of your production has to be reworked. By definition, this is non-value-added work. Lean calls this muda. Six Sigma calls it a defect.

It’s worth taking a closer look here.

When you rework a part, you consume additional labor hours, machine time, and process capacity. When you scrap it, you lose all the material used, the energy for production and transport—plus the costs for disposal and procurement of new parts.

Life cycle analyses show that reworked parts/components reduce their CO₂ emissions by 30-70% compared to new production. This is especially true for energy-intensive mechanical components in battery technology, shipbuilding, or defense.

Rework is therefore not ideal. But it is often the more economical and environmentally friendly alternative to scrapping. When it becomes necessary, you should organize it with the right partners.

Reducing COPQ: How sorting and reworking reduce your error costs

Cost of Poor Quality is not an abstract metric. It defines the real cash flow that you burn through errors.

A company with $200–300 million in sales loses an average of 15–20% of that in error costs. That’s $30–60 million annually. A significant portion of this goes to internal and external rework activities.

If 25% of your parts require rework and some of them are still scrapped, your effective unit costs increase by 20–30%. Without the customer seeing it. Without you making a cent more in sales.

Practical examples from automotive suppliers show that PPM values average between 100 and 500 PPM. Best-in-class plants achieve less than 50 PPM. For quality managers in the automotive, charging infrastructure, and shipbuilding industries, PPM values are the decisive indicator. The difference affects three levels: quality, costs, and sustainability.

Every part that is saved by reworking avoids new production. Every part that is scrapped has already consumed material, energy, and process capacity – for nothing.

Containment measures in quality management: Expensive, but line downtime is more expensive

When a defect occurs in series production, you have three options:

• You stop production.
• You continue to deliver and hope that the customer does not notice the error.
• Or you sort 100%.

The third option costs money immediately. An external or internal sorting team on site, a quality gate in goods issue, express logistics for suspicious batches. All of these are high costs in the short term.

But a series or field recall costs significantly more. Delivery stops result in contractual penalties. Conveyor downtime at the OEM costs you your reputation.

For quality managers, three things are crucial when containment measures are in place:

1. . Response time
How quickly can a team be on site or at the plant? Hours count, not days.

2. Transparency
Clear separation of OK/NOK. Documented error patterns. Batch tracking. No “estimates.”

3. Process stability during the measure
If new errors arise during sorting, the system should not collapse, but be flexibly adapted.

Sorting and rework as a data source for sustainable process improvement

The second role of modern rework is less visible, but more important in the long term.

Every sorting action generates structured information: error types, frequencies, batches, suppliers, process steps. This data is direct input for FMEA updates, 8D reports, machine and process optimizations.

Anyone who sees rework only as a cost center is wasting this opportunity for process improvement.

Those who use it as a measuring point in the process can significantly improve both COPQ and ecological parameters in the medium term.

A good example from practice:

A customer reported defective connectors to a supplier of charging infrastructure. We sorted the material that had already been delivered, checked each part, and documented the defects digitally. The data shows that 80% of the defects occurred in a specific cavity of the injection mold. The supplier reworked the mold. The rework rate dropped from 12% to 2%.

Without structured sorting and data collection, the cause would have been found much later. With higher scrap rates. With more complaints. With significantly higher costs.

Rework is no substitute for root cause analysis. But it does provide you with the data that shows where the problem lies.

Circular economy: When rework becomes part of the business model

In industries with durable capital goods – e-mobility, industrial machinery, shipbuilding – rework is increasingly becoming a conscious part of the product life cycle.

Recalls, retrofit programs, refurbishment strategies: all of these are based on the principle that components are not scrapped but remanufactured. Research and practice show that systematic remanufacturing in the field not only avoids waste but also enables new service and business models.

For quality managers, this means that rework is not just “repairing a defect.” It can become part of an overarching product and service concept. Especially when regulatory requirements and CO₂ budgets demand longer usage cycles.

This does not only apply to the automotive industry. The bicycle industry, defense, plastics industry, alternative energies: wherever parts and components are assembled, the pressure for circular value creation is increasing.

Many treat rework as nothing more than crisis management. In doing so, they miss the strategic level.

Improving first pass yield: Three KPIs that make your rework measurable

For sorting and rework to be accepted as professional tools in quality management, they must be measurable.

First pass yield (FPY)

How many parts pass the process on the first run without rework and without scrap?

FPY = 75% means: 25% cause rework or scrap. This increases the average process costs per good part by 20–30% and drives up your carbon footprint per delivered product.

Rework rate

Percentage of units produced that require rework. Differentiated between internal rework (own plant) and external rework (customer, service provider, field). The rework rate is ambivalent for sustainability: in the short term, it indicates waste, but in the long term, its decline – accompanied by a drop in scrap – points to optimized processes.

PPM values (parts per million defects)

Best-in-class plants achieve less than 50 PPM. The average is 100–500 PPM. Every increase in quality directly results in less rework, fewer complaints, and less environmental impact from return shipments and replacement parts.

These three key figures show you whether the project is working before and after structured sorting and rework measures. These key figures are transparent, comparable, and can be directly linked to COPQ and sustainability goals.

Conclusion

Any defect that does not occur in the first place is optimal from a cost and environmental perspective. Prevention is and remains the gold standard.

But defects will never completely disappear, because no production system is flawless. Not in automotive. Not in charging infrastructure. Not in shipbuilding, defense, white goods, plastics, or other industries.

When errors occur, the quality of your containment and rework processes determines three things:

1. Your costs

Effective unit costs increase by 20–30% if you do not organize rework professionally.

2. Your delivery reliability

Production line downtime and delivery stops cost contractual penalties and reputation.

3. Your sustainability balance sheet

Every scrapped part has already consumed energy, material, and transport—for nothing.

You need rework either way. The decisive factor is whether you see it only as a cost center or use it as a data-driven tool that improves your processes.

If your FPY is below 80%, if your rework rate is increasing, if your PPM values are in the triple digits, then you are losing money and resources as you read this.

Talk to someone who organizes sorting and rework not as a firefighting exercise, but as a transparent, measurable system. Someone who links containment, data collection, and process improvement. Someone who works across industries and knows that a quality gate must function the same way in the bicycle industry as it does in the defense or automotive industries.

Contact us. We’ll show you how rework can stop being just a cost center and start delivering data that improves your processes.

---

Frequently asked questions about sorting and rework

---