TRAVERSE CITY, MI – Saying his surging Chrysler Group is fast-adopting the manufacturing and development flexibility that is a constant buzzword in the automotive industry, Tom LaSorda, the auto maker’s chief operating officer, challenges the supplier sector to keep pace.

“As we (Chrysler Group) become faster and move innovative – as we become more flexible – will you be fast enough to out-innovate us?” LaSorda asks. “To take business to a new level requires taking flexibility to a new level,” he adds, calling Chrysler’s strategy “the fully flexible corporation.” (See related story: Suppliers Ready to Innovate, Eager for Harmony)

Chrysler’s ultimate manufacturing goal, LaSorda says, is “to design and build virtually anything just about anywhere, with improving speed and quality.”

Chrysler Group COO
Tom LaSorda

Chrysler’s mounting product-development speed and manufacturing flexibility, LaSorda says, may be leaving even its most capable suppliers in the dust.

He says Chrysler’s Material Cost Management process, which originally was conceived to find and apply the best technology for the least cost, has delivered another unpredicted benefit: The process is “inspiring our team to out-innovate some of our suppliers.”

LaSorda’s example is the design for a component that curbs fuel-system vapors. He says the MCM process led company engineers to “put aside” a supplier’s design and craft an alternative.

The Chrysler-developed part, says LaSorda, is “better quality and less weight at a price that’s at least 70% lower than the lowest supplier quote.”

LaSorda says the auto maker also is rapidly becoming lighter on its feet in terms of manufacturing flexibility. Chrysler’s ability to launch the innovative Stow ’n Go foldaway seats in its current minivans in just 18 months is testimony to the ever-quickening pace of the company’s product-development, engineering and manufacturing arms.

The Stow ’n Go experience, he adds, also proves Chrysler is able to more quickly pull the trigger on vital investment programs.

“Admittedly, we were on a dangerous path to potentially lose our leadership in the (minivan) segment,” LaSorda says. “So we challenged the team with a significant capital commitment – $400 million – and we asked them to sustain our lead position, a challenge that required the creation of an entirely new platform and underbody.”

But Chrysler’s most prominent and assertive thrust in the move-fast-and-be-flexible game is its unique plan for the upcoming Toledo North assembly plant.

The plant will co-locate major suppliers that will have full responsibility for three major portions of production: body shop, paint shop and rolling chassis. (See related story: Chrysler Outlines New Toledo Plant, Suppliers)

The Toledo North venture is one of six flexibility “concepts,” on which LaSorda says Chrysler is focused. They are:

  • Chaining
  • Volume
  • Platform/architecture
  • Model-mix
  • Supplier/component
  • Business model

Chaining and model flex, LaSorda says, allow the auto maker to quickly respond to market dynamics. Platform/architecture flex drives development of multiple products from a common platform.

Model mix flex is achieved with subassemblies that ease model differentiation or derivatives. And business-model flex is exemplified by the Toledo North strategy.

“Three suppliers will construct and own nearly 1 million sq.-ft (92,900 sq.-m) of plant space,” at Toledo North, LaSorda says. The innovative plan demonstrates Chrysler’s growing speed and flexibility.

He says Toledo North was the perfect place to engage the plan because of the stable volumes of the Jeep Wrangler slated to be built there and because the company planned to replace the seriously aged paint and body shops in the Wrangler’s current plant not far away.

Despite these intricately defined new areas of speed and flexibility, “we’re really just getting started in applying flexibility to our business,” LaSorda says.

The question now appears to be: Can suppliers match the pace? “Embrace flexibility,” is LaSorda’s advice. “Challenge your key partners to do the same. If they don’t, find new partners.”

bvisnic@primediabusiness.com