Flexibility was the topic of the Automotive News Conference in Birmingham, Alabama this week. While auto manufacturing factories slow with the weak economy and sales drop, car makers are finding ways to optimize operations during this industry breather. Manufacturing executives from Mercedes-Benz, Honda, Toyota, BMW, Hyundai and Volkswagen all gave accounts of how they are being flexible.
Bill Taylor, the retiring President & CEO of Mercedes-Benz U.S. International, who oversees the Tuscaloosa, Alabama, plant that makes the ML, GL and R Class vehicles for 130 countries, says "fast and flexible defines the industry today... continuous improvement is part of the solution." Taylor stressed the importance of training during these times and said that in January there were 500 job changes at his facility of 3,000 employees.
Chuck Ernst, Senior Vice President, Honda Manufacturing Alabama, says Honda engaged in "flexibility and reprogramming vs. retooling" 10 years ago and has been moving production between plants in reaction to the market demand ever since. He called April 10th of this year "a fun, flexible day" when one line at his plant made 2009 Pilots, 2009 Odysseys, Accords and 2010 Pilots in two 8 hour shifts. Ernst says downtime is being used to find ways to cut costs and revamp the facility by doing simple things to improve efficiency, like making new parts' racks.
Josef Kerscher, President, BMW Manufacturing, who ran BMW's Munich plant for ten years before taking over the factory at Spartanburg, South Carolina, three years ago, says they make 170,000 vehicles a year for the world. Specifically, the X5 and X6 Sports Activity Vehicles (SAVs) and soon production of a new X3 will move from Austria to Spartanburg. The Spartanburg plant, BMW's first outside of Germany, celebrates its 15th anniversary in December. Kerscher looks forward to making the 555 horsepower M version of the X6 and X6 hybrid and says they are "well underway with their plant expansion".
Don Jackson, President, Manufacturing, and Production, Volkswagen Group of America, boasted that VW's sales drop of 15.5% this year is much better than the overall industry. In "early 2011", VW will be making an all-new mid-size sedan at a factory under construction in Chattanooga, Tennessee, which will be their 62nd plant worldwide and "the model of flexibility" with room to expand. Jackson repeated the company's goal of nearly doubling Volkswagen's current global production to 11 million vehicles by 2018.
Steve St. Angelo, Senior Vice President of Toyota Motor Engineering & Manufacturing North America which covers seven plants in the U.S. and two in Canada, gave the most lively presentation, using props, slides and video to show how his plants are reducing costs. As examples, they are removing lighting and air conditioning in storage and work areas where there are no people. Toyota, which hasn't laid off any "team members" is using the extra time to create more space by reorganizing their floor plan and replacing old technology with new. St. Angelo showed videos of their "Quality Idol", where employees sing familiar tunes with words changed to describe Toyota's quality. Sounds like a good morale booster.
In Hollywood, while waiting to audition for a role or filling time before a call to perform, it's called the "hurry up and wait" scenario. Actors are taught to make the most of that precious time by using it to best advantage. For now, car makers are in the "hurry up and wait" mode - making the most of their downtime.
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