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American automakers make gains in factory efficiency |
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June 17, 2000 DETROIT, (AP) - Strong demand for trucks helped American automakers boost the efficiency of their factories in 1999, closing a decade-old gap with foreign automakers.
For the first time in the 11-year history of the Harbuor Report on auto factory productivity, an American automaker - Ford Motor Co. - had the most efficient car and truck assembly plants in North America. Ford's Atlanta car assembly plant and its St. Paul truck plant beat out Nissan's Smyrna, Tennessee site, which builds cars and trucks and came in second in both rankings.
General Motors Corp. was cited as most improved by Ron Harbuor, president of Harbuor and Associates, who said the company had made large strides toward making its plants more efficient after several years of lagging behind the competition.
"There are individual plants throughout the Big Three that can really match the Toyota and Nissan plants," Harbuor said. "It's a huge step from where they were 10 years ago, but it's not all there."
Harbuor ranks productivity by the average number of labor hours it takes to build a vehicle. Workers at Ford's Atlanta plant averaged 17.16 hours for every Ford Taurus and Mercury Sable they built, while Nissan's Smyrna plant averaged 17.53 hours for every Altima sedan.
In trucks, Ford's Twin Cities plant averaged 18.97 hours for every Ranger pickup, while Smyrna averaged 19.09 hours for every Frontier pickup and Xterra sport utility vehicle. When broken into 12 vehicle categories, Ford took the top spot in 11, missing only subcompact cars.
Japanese manufacturers still came out on top overall, in part because they have fewer and newer plants in North America than Ford, GM and DaimlerChrysler AG. Nissan had the best average productivity of 18.22 hours per vehicle, followed by Honda at 20.26, and Toyota with 21.75.
Ford averaged 23.23 hours per vehicle, while GM averaged 28.41 and DaimlerChrysler averaged 30.05.
GM's overall efficiency was up 8.8 percent, more than any other manufacturer with more than one factory in North America. Harbour said GM's gains were notable because the company had started learning lessons from its California joint venture with Toyota to cut costs.
"Many of the GM plants right now are looking very Toyota-like," Harbour said. "If I were to make a general statement about the traditional Big Three ... GM is probably the leanest of all of those right now. They've made the most progress."
The gap between GM, Ford and DaimlerChrysler and the Japanese manufacturers is expensive for the U.S. manufacturers, Harbour said. He estimates that if all of GM's North American plants - assembly, stamping and powertrain - were as efficient as those operated by Nissan, it would need 41,754 fewer workers and save dlrs 5.2 billion a year. DaimlerChrysler would need 23,436 fewer workers and could save dlrs 2.9 billion.
But being the most productive doesn't mean making the most money. Harbour said Nissan had the lowest profits per vehicle, losing dlrs 17 on each, because of its financial troubles.
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