In this paper, a new formulation model for cellular manufacturing system (CMS) design problem is proposed. The proposed model of this paper considers assembly operations and product structure so that it includes the scheduling problem with the formation of manufacturing cells, simultaneously. Since the proposed model is nonlinear, a linearization method is applied to gain optimal solution when the model is solved using direct implementation of mixed integer programming. A new genetic algorithm (GA) is also proposed to solve the resulted model for large-scale problems. We examine the performance of the proposed method using the direct implementation and the proposed GA method. The results indicate that the proposed GA approach could provide efficient assembly and product structure for real-world size problems.