This case study has been conducted at Sandvik Mining and Construction Köping AB, a company belonging to the Sandvik Group, which manufactures drill bits for the mining industry. The organization works with improvements according to the principles of lean production. This work includes, amongst other things, a major layout change aiming at improving the overall material flow through the factory. In the new layout the manual assembly line for drill bits will be relocated. This offers an opportunity to review the layout for the manual assembly line using principles from Lean and Ergonomics. The purpose of this study is to propose an assembly layout designed in such a way that the occurrence of non-value adding activities is minimised. The assembly line shall also be designed in a way that prevents errors and creates favourable conditions for an ergonomically suitable work environment. A proposal for a new assembly layout has been developed using the tool Simplified Systematic Local Planning (SSLP). This has been achieved with the support of theories and principles of Lean production, ergonomics, material handling and workplace design. By mapping the proposed assembly line process, the overall improvement is estimated to save 158 meters in walking distance and 126 meters of forklift driving in set-up of a production order. A time saving of 50 minutes for assembling a batch of nine drill bits has also been achieved. This submission presents a general approach to layout changes within a framework including Lean and ergonomics.