“Yikes!” That seemed to be the consensus response Detroit auto makers had to a speech last month in Traverse City, MI, by Hiroyuki Yoshino, the president of Honda Motor Co. Ltd. First he made them squirm in their seats by explaining how Honda plans to globalize and build a market for its products in Asia independently, without merging or acquiring foreign partners. In the process, he subtly dismissed efforts of Detroit auto makers who are trying this route, so far unsuccessfully.
Then it got worse. During a panel discussion he hung his head and said that even though Honda now has the capability to produce seven or eight different models in each of its plants, it needs to do better.
There was an audible gasp from the audience. Most of Detroit's plants can build only one or two of a car or truck model.
The day before, Ford Motor Co.'s head of manufacturing thumped his chest and promised a new initiative would equip half of its North American assembly plants with flexible body shops capable of building four different models by 2005.
Chrysler Corp. bragged its new flexible manufacturing strategy would allow it to build the '04 Chrysler Pacifica (based on a different platform) in the same plant where it builds its current lineup of minivans, but it requires its own dedicated body shop to do so.
The president of Mitsubishi Motor Mfg. of America Inc. then pronounced: “The days of two plants doing one model is going to disappear.”
That sounded visionary until the next day, when Yoshino reminded everyone the era of dedicated plants had been over for a long time at Honda.
Honda has been wowing Detroit for years by doing model changeovers without stopping production, while GM, Ford and Chrysler plants can take weeks or months to do the same. Honda also was the first to build minivans and SUVs on the same line in Alliston, Ontario, Canada.
It isn't alone. Toyota builds the Sienna minivan and Camry and Avalon sedans on the same line at Georgetown, KY. Nissan will build a fullsize pickup, two SUVs and a minivan at its new Canton, MS, plant.
Detroit is changing its ways, even though its dedicated plants are some of its most efficient and produce the best quality. It's hard to move faster: Flexible body shops are extremely expensive, and most Big Three products don't yet have common architectures and “hard points” to do it right.
But look at the price Detroit is paying for having high-profit truck plants unable to keep up with demand while factories dedicated to unpopular cars are growing cobwebs.
When the Neon-based PT Cruiser was one of the hottest selling vehicles in the U.S., Chrysler couldn't add capacity at its woefully underutilized Neon plant because it wasn't flexible. That's crazy. Whatever Detroit is doing to get flexible, it has to dial its efforts up another notch.
