Laser vision inspection systems are becoming popular for automated inspection of manufactured components. The performance of such systems can be enhanced by improving accuracy of the hardware and robustness of the software used in the system. This paper presents a new approach for enhancing the capability of a laser vision system by applying hardware compensation and using efficient analysis software. A 3D geometrical model is developed to study and compensate for possible distortions in installation of gantry robot on which the vision system is mounted. Appropriate compensation is applied to the inspection data obtained from the laser vision system based on the parameters in 3D model. The present laser vision system is used for dimensional inspection of car chassis sub frame and lower arm assembly module. An algorithm based on simplex search techniques is used for analyzing the compensated inspection data. The details of 3D model, parameters used for compensation and the measurement data obtained from the system are presented in this paper. The details of search algorithm used for analyzing the measurement data and the results obtained are also presented in the paper. It is observed from the results that, by applying compensation and using appropriate algorithms for analyzing, the error in evaluation of the inspection data can be significantly minimized, thus reducing the risk of rejecting good parts.