PurposeIn a kitting supply system, the occurrence of material-handling errors is unavoidable and will cause serious production losses to an assembly line. To minimize production losses, this paper aims to present a dynamic scheduling problem of automotive assembly line considering material-handling mistakes by integrating abnormal disturbance into the material distribution problem of mixed-model assembly lines (MMALs).Design/methodology/approachA multi-phase dynamic scheduling (MPDS) algorithm is proposed based on the characteristics and properties of the dynamic scheduling problem. In the first phase, the static material distribution scheduling problem is decomposed into three optimization sub-problems, and the dynamic programming algorithm is used to jointly optimize the sub-problems to obtain the optimal initial scheduling plan. In the second phase, a two-stage rescheduling algorithm incorporating removing rules and adding rules was designed according to the status update mechanism of material demand and multi-load AGVs.FindingsThrough comparative experiments with the periodic distribution strategy (PD) and the direct insertion method (DI), the superiority of the proposed dynamic scheduling strategy and algorithm is verified.Originality/valueTo the best of the authors’ knowledge, this study is the first to consider the impact of material-handling errors on the material distribution scheduling problem when using a kitting strategy. By designing an MPDS algorithm, this paper aims to maximize the absorption of the disturbance caused by material-handling errors and reduce the production losses of the assembly line as well as the total cost of the material transportation.