Lutz: GM may reopen plants
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Lutz: GM may reopen plants
Less automation would allow fast, cheaper startup
Mark Rechtin
Automotive News -- February 15, 2010 - 12:01 am ET
ORLANDO -- General Motors Co. is looking to add capacity by bringing shuttered plants back on line using labor-intensive tooling, Vice Chairman Bob Lutz said.
"We are looking at taking an unutilized plant and putting in less-automated systems that you can put in quickly and at low investment," Lutz said in an interview here. "The downside is more labor cost. But we'll gladly pay that labor cost to get an additional high-margin unit."
Chrysler used this tactic in the 1990s when demand spiked unexpectedly. Using labor-intensive tooling may go against the grain of most manufacturers installing more-automated tooling. But GM does not want to spend "hundreds of millions of dollars for a new, highly automated body shop which comes on-stream 21/2 years from now. We need the stuff now."
The plan, Lutz said, is to have something "ready in a matter of months instead of years."
Currently, GM is running third shifts at several plants. But, Lutz said, "We are going to need some capacity beyond third-shifting the hot products."
Mark Reuss, president of GM North America, and Diana Tremblay, vice president of manufacturing and labor relations, are investigating restarting shuttered plants. Off-line plants include Spring Hill, Tenn.; Janesville, Wis.; and Oshawa, Ontario.
Lutz, 78, declined to say which one would be a front-runner for reopening. In January, Reuss mentioned the Spring Hill plant in a discussion about reopening factories.
"Here's the scary thing," Lutz said. "We are short of SRX, Equinox, Terrain, the big crossovers like Enclave, Traverse, Acadia. We're short of LaCrosse.
"This is in a relatively weak market. If the market goes to 13 or 14 million, then our share will go down because we can't supply."
Still, Lutz said GM did not overreact in shuttering so many plants during its bankruptcy last year.
"Given what we were staring at, we did the right thing, given the circumstances," he said. "We cut to the bone because no one knew how bad it would get."
No matter how quickly GM ramps up, Lutz added, "the precision still needs to be there. We will not compromise quality to get the volume. That is no longer part of the GM ethic."
Mark Rechtin
Automotive News -- February 15, 2010 - 12:01 am ET
ORLANDO -- General Motors Co. is looking to add capacity by bringing shuttered plants back on line using labor-intensive tooling, Vice Chairman Bob Lutz said.
"We are looking at taking an unutilized plant and putting in less-automated systems that you can put in quickly and at low investment," Lutz said in an interview here. "The downside is more labor cost. But we'll gladly pay that labor cost to get an additional high-margin unit."
Chrysler used this tactic in the 1990s when demand spiked unexpectedly. Using labor-intensive tooling may go against the grain of most manufacturers installing more-automated tooling. But GM does not want to spend "hundreds of millions of dollars for a new, highly automated body shop which comes on-stream 21/2 years from now. We need the stuff now."
The plan, Lutz said, is to have something "ready in a matter of months instead of years."
Currently, GM is running third shifts at several plants. But, Lutz said, "We are going to need some capacity beyond third-shifting the hot products."
Mark Reuss, president of GM North America, and Diana Tremblay, vice president of manufacturing and labor relations, are investigating restarting shuttered plants. Off-line plants include Spring Hill, Tenn.; Janesville, Wis.; and Oshawa, Ontario.
Lutz, 78, declined to say which one would be a front-runner for reopening. In January, Reuss mentioned the Spring Hill plant in a discussion about reopening factories.
"Here's the scary thing," Lutz said. "We are short of SRX, Equinox, Terrain, the big crossovers like Enclave, Traverse, Acadia. We're short of LaCrosse.
"This is in a relatively weak market. If the market goes to 13 or 14 million, then our share will go down because we can't supply."
Still, Lutz said GM did not overreact in shuttering so many plants during its bankruptcy last year.
"Given what we were staring at, we did the right thing, given the circumstances," he said. "We cut to the bone because no one knew how bad it would get."
No matter how quickly GM ramps up, Lutz added, "the precision still needs to be there. We will not compromise quality to get the volume. That is no longer part of the GM ethic."
Last edited by 95redLT1; Feb 15, 2010 at 04:53 PM.
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No matter how quickly GM ramps up, Lutz added, "the precision still needs to be there. We will not compromise quality to get the volume. That is no longer part of the GM ethic."
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I think the only mistake they made was closing Orion. If it was open, they could be building Malibus there and more high-profit Buicks in KC. I have to think they would open that first.
Re-opening Spring Hill could get them Traverses right away, and let Lansing catch up on Enclaves and Acadias. Getting the small crossovers will be a lot tougher - they will need to put in new tooling somewhere, and that takes time.
-Geoff
Re-opening Spring Hill could get them Traverses right away, and let Lansing catch up on Enclaves and Acadias. Getting the small crossovers will be a lot tougher - they will need to put in new tooling somewhere, and that takes time.
-Geoff
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This is the nightmare with the auto industry. One minute yoru seling 9 million cars a year, 2-3 years late your selling 15 million. It is almost impossible to properly manage the need for that kind of flexbility capacity in a unionized environment.
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And, though I am no fan of unions, I think more of the fault lies with the people who plan super-lean supply chains and super-automated factories, because these scenarios thrive on stability, predictability, and the smallest amount of product variation possible. Remember, we were able to provide significantly more options, colors, models, and trims in the 60s, 70s, and 80s--and literally change it every year or two in the 60s--and that was union labor, no supply chain optimization, no robotics, and no computers.
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Do you have any knowledge of manufacturing and what goes into producing a car? Getting a new plant online and running good vehicles in months would be an incredible accomplishment! When do you want it done, next Monday?
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It's a fricking joke you up-tight tards.
Yes I get it's a good thing.
For the record, I was the one that said on here while scaling down becareful killing your ability to produce SUV's in numbers when gas was $4 because contrary to popular belief at that time, I had the foresight to realize it wouldn't stay that low forever.
Yes I get it's a good thing.
For the record, I was the one that said on here while scaling down becareful killing your ability to produce SUV's in numbers when gas was $4 because contrary to popular belief at that time, I had the foresight to realize it wouldn't stay that low forever.
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It's a fricking joke you up-tight tards.
Yes I get it's a good thing.
For the record, I was the one that said on here while scaling down becareful killing your ability to produce SUV's in numbers when gas was $4 because contrary to popular belief at that time, I had the foresight to realize it wouldn't stay that low forever.
Yes I get it's a good thing.
For the record, I was the one that said on here while scaling down becareful killing your ability to produce SUV's in numbers when gas was $4 because contrary to popular belief at that time, I had the foresight to realize it wouldn't stay that low forever.
bet you couldn't tell i'm not really upset and actually smiling right now! ha, proof you can't read emotions through text!
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The fact is that lean manufacturing and automation have reduced costs dramatically - and the auto industry has been struggling to make profits for several years now.
And by comparison, manufacturing companies that in this country that don't use lean manufacturing are either in the process of switching over or closing the doors. Automation aside, as there are still some products where most things have to be done by hand.
However, GM needs to get rid of rebates first. Increasing supply *just* enough is going to be tough.
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GM cut too much and now has to look at increasing production costs just to hopefully meet demand.
I don't think this is GM's fault but instead the Gov't wanted to see "X" amount of plants for "X" amount of cars and GM had to do what GM had to do.
Truth is, when you're in such dire straits that you don't have inventory on you're hottest launch products (Equinox, Camaro, LaCrosse) AND trucks (Traverse).....that ain't good at all.
I don't think this is GM's fault but instead the Gov't wanted to see "X" amount of plants for "X" amount of cars and GM had to do what GM had to do.
Truth is, when you're in such dire straits that you don't have inventory on you're hottest launch products (Equinox, Camaro, LaCrosse) AND trucks (Traverse).....that ain't good at all.
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, since I am hoping to get some kind of specials on 2010 equinox next year. If they over flow, 0% financing for 60 months would do it for me. 
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