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Explains that a tandem automated guided vehicle (AGV) system is composed of several non‐overlapping closed loops. Stations or machines within each loop are served by a single dedicated vehicle. The transit area located between two adjacent loops serves as an interface and allows loads to be transferred from one loop to another. If a load needs to be delivered to a machine not located within the same loop, the load will need more than one vehicle to carry it to its destination. Develops a model to solve the machine partition and layout problems concurrently in tandem AGV systems. During the design process, the objective is to minimize the number of loops to reduce the setup costs of AGVs in the system. Naturally, the desirability of a prospective loop must be evaluated in terms of the number of machines it covers, the workload of each AGV, and the ratio of the flow within the loop to the total flow associated with that loop.Quality indicators Research implications** Practice implications** Originality** Readability**

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