On 6/3/05, Michael Perelman <[EMAIL PROTECTED]> wrote:
> The Harbour Report, an influential gauge of productivity and profitability
> that is
> closely watched in the auto industry,
thanks. Here's a capsule description. As is common, "efficiency" is
measured in terms of restricting the use of labor-time (hey! Karl Marx
would be proud) rather than in terms of all costs, including
"external" ones.
HARBOUR REPORT: U.S. automakers boost factories' productivity
But Toyota tops the list as most efficient
June 3, 2005
BY MICHAEL ELLIS and JEFFREY McCRACKEN
[Detroit] FREE PRESS BUSINESS WRITERS
Detroit's three automakers improved the efficiency of their
manufacturing plants in North America last year, but Toyota Motor
Corp. made the most impressive gains and moved into first place ahead
of Nissan Motor Co. in a benchmark study of worker productivity.
For the third straight year, the domestic car companies cut the number
of labor hours it takes to assemble a vehicle, stamp out its parts and
build the engine and transmission, according to the annual Harbour
Report.
General Motors Corp. remained the most efficient of the three
U.S.-based automakers, cutting nearly one hour, or 2.5%, from the time
needed last year to build a vehicle to an average of 34.33 hours, the
study said. Chrysler Group, a division of Germany's DaimlerChrysler
AG, shaved 4.2% off its time to average 35.85 hours, down from 37.42
hours. Ford Motor Co. also chopped 4.2% off its time, to rank last
among the three domestic automakers with a time of 36.98 hours, down
from 38.60 hours previously.
The gains by Ford and GM were particularly impressive given that they
lost market share last year, Ron Harbour, president of Harbour
Consulting, told reporters at a news conference Thursday.
"The fact that they made an improvement, in light of the volume
losses, was pretty significant," he said. "It's a real testament to
their efforts that, even if the volume wasn't there, they continued to
work on improvements, and it really showed."
GM's car assembly plant in Oshawa, Ontario, where it builds the
Chevrolet Impala sedan and the Chevrolet Monte Carlo coupe, took the
title of most efficient vehicle assembly plant. The GM plant beat out
Nissan's facility in Smyrna, Tenn., due in part to disruption caused
by shifting some production of the Altima midsize sedan to a plant in
Alabama, Harbour said.
Chrysler, which has put common systems in place at its plants so they
can run regardless of changes in workers or plant managers, has been
the most-improved company in the last three years in the study,
improving its hours per vehicle by 19%, Harbour said.
While Chrysler's new 300C sedan is turning heads on the streets, its
Hemi V8 engine is one secret to the company's stronger profits. The
overhead-valve engine is quicker to assemble than more sophisticated
overhead-cam engines, resulting in significant profits for the Auburn
Hills-based automaker, Harbour said. "It's probably the most simple
engine on the market," he said.
Harbour credited Chrysler Chief Operating Officer Tom Lasorda [fresh
from the L.A. Dodgers?], who joined the automaker from GM five years
ago to run Chrysler's manufacturing operations, with the improvement.
"Chrysler is for real. Tom Lasorda is the strongest lean-manufacturing
guy at a top level," Harbour told the Free Press. "He's taking his
background in lean manufacturing and drilling it into product people,
purchasing and other departments and getting them to all buy in."
But Toyota led all automakers with a 5.5% improvement to an average of
27.90 hours to build a new vehicle.
"Toyota improving the most this year, I guess, is kind of like the New
York Yankees adding two more All-Stars to their team," Harbour said.
Toyota's leading-edge efficiency results in a cost savings of $300 to
$500 per vehicle over the U.S. automakers, Harbour said, a significant
figure when millions of vehicles are built each year.
Ironically, Toyota is one of the few automakers that still assemble
many car parts internally at their own plants, Harbour said. While
many automakers seeking lower labor costs have outsourced the assembly
of some car parts, such as the instrument panel, Toyota's high quality
and productivity make building parts internally more profitable,
Harbour said.
"They insist, with their quality and their ability to manufacture
better than their suppliers, why change? It's interesting when you
look at these numbers, that, as good as Toyota is, they may actually
be better than that," he said.
Nissan and Honda Motor Co. posted the weakest results among the six
major automakers last year, but they remain ahead of their U.S.
competitors. Nissan's plant efficiency fell by 4.8% to 29.43 hours,
hurt by the launch of the new Pathfinder sport-utility vehicle and the
Frontier midsize pickup truck last year.
Honda improved by just 0.2% to an average of 32.02 hours. While Honda
placed last among the three major Asian automakers, its vehicle
asse
