Supplier: GM Still Not Lean Enough

TRAVERSE CITY, MI – How much courage does it take for a supplier to suggest its biggest customer isn’t as lean as it should be?

He is tactful in doing so, but Michael Vella, vice president and general manager of TI Automotive’s Global Fluid Carrying Systems unit in Warren, MI, refers to General Motors Corp. at least twice in his speech here at the Management Briefing Seminars.

Although he sees GM – as well as Ford Motor Co. and the Chrysler Group – making great strides in manufacturing efficiency, Vella says the Big Three have not embraced lean manufacturing as strongly as the Japanese auto makers. “Coming from Detroit, that concerns me,” Vella, a Detroit native, says.

“I’ve been going into customer plants for 10 years, and I don’t see a strong company-wide push for lean” at GM, Vella tells Ward’s after his speech.

Although independent analysts such as Harbour Consulting give GM top marks for its implementation of lean production methods, Vella sees Ford as being more committed to lean manufacturing than GM and Chrysler.

He says the No.2 auto maker’s Lean Resource Center in Dearborn is an outstanding educational tool that has helped TI and other suppliers.

TI’s No.1 customer is GM, which purchases 46% of the supplier’s output. Ford is the No.2 customer, at 21%.

“I would like to see them do more,” Vella says of GM and its lean methods.

He sees GM and the rest of the Big Three losing market share and amassing record inventory and says lean methods could improve their overall cost structure.

Vella also refers to a recent Harvard Business Review article, which identified Japanese auto makers as much more advanced in lean methodologies than the Big Three.

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