This paper proposes a new automated guided vehicle (AGV) dispatching a
lgorithm based on a bidding concept. The suggested algorithm utilizes
the information of work in process in incoming and outgoing buffers of
a machine center, and travel time of an AGV through mathematical func
tions that are called ''bidding functions'' in this paper. Because the
bidding functions have parameters, a sensitivity test is performed to
find their appropriate values. The performance of the algorithm is co
mpared with those of well-known existing rules in terms of system thro
ughput through simulation on a hypothetical job shop type manufacturin
g system.