TRAVERSE CITY, MI – “Collaboration” means different things to different people. But Larry Denton, president and CEO of Dura Automotive Systems Inc., says in today’s difficult environment there are opportunities for new collaborative efforts between industry and government that could reinvigorate manufacturing in the U.S.
Freely admitting he is mixing in a few commercials with his philosophy, Denton says here at the Management Briefing Seminars that suppliers and OEMs should take the time to communicate more with elected representatives on seven key issues that could define success for American manufacturing:
- Fair Floating Currency. Denton says the U.S. dollar can compete with other currencies, but not against the “pegged” Chinese currency structure.
- Corporate Average Fuel Economy. Raising a few eyebrows, Denton chides OEMs for not moving faster on CAFE improvements. “In 1991, the government stopped driving the industry (for innovation), so the U.S. industry quit. Just 1% (improvement) per year and we would currently be exceeding Europe.” (Dura just happens to produces lightweight aluminum doors in Europe that can help fuel economy.)
- Safety. While auto makers have made great progress in the area of safety, Denton says they should be looking into areas that aren’t yet being regulated, such as power window systems that are safer for children. (Dura just happens to make such a system.)
- Health Care. Denton once worked in Canada and says he used to think its socialized medicine was a bad idea, but not anymore. “In a globally competitive market, we have to pay 30% more simply because the rules are different,” he says.
- Intellectual Property Protection. Many OEMs and suppliers are finding their products and technologies being copied by companies in countries that don’t have regulations against piracy. “This isn’t fair trade. This isn’t even close,” he says.
- Tort Reform. Litigation, regulation and rising energy prices add 22.4% to the price of production for U.S. companies, nearly equaling total production costs in China.
- Inflation. After managing downward pricing for 15 years, suppliers and OEMs will have to learn how to manage price increases collaboratively, rather than destructively.