ASC Deciding on Niche Plant

DETROIT – Too many concept cars have come and gone from the North American International Auto Show over the years without ever going into production.

American Specialty Cars Inc. is endeavoring to halt this trend by providing an outlet for low-volume niche vehicles that auto makers would love to produce but cannot establish the proper business case to do so.

“It’s time to stop the madness,” Paul Wilbur, president and CEO of the Southgate, MI, supplier, says at a press conference here at the auto show. “We’re going to put a stake in the ground right now. We’re pro-life for cool cars.”

ASC uses OmniCarbon process to form hood of Viper Diamondback.

Wilbur tells Ward’s he expects ASC to announce this year whether it will build or purchase a plant specifically to assemble low-volume niche vehicles for one or more auto makers.

“We are trying to get a couple programs under our belt that we would put into the facility,” Wilbur says.

ASC is evaluating different sites around the U.S., as well as in Mexico, where labor is less expensive. “Our process tends to be non-automated, non-robotic, non-conveyor; so labor rates are a big deal to us,” Wilbur says.

Rumors are circulating here that ASC could purchase outright the Lansing, MI, Craft Centre from General Motors Corp.

GM announced in November the historically under-utilized facility, which most recently assembled the now-discontinued Chevrolet SSR roadster pickup, will close this year.

ASC has had significant experience with the Craft Centre, as it assumed much of the development responsibilities for the SSR program.

ASC also has its own Lansing, MI, plant, which ships 42 separate subassemblies direct to the Craft Centre for the SSR. ASC manages 90% of the SSR’s content.(See related story: ASC Wants to Repeat SSR Success )

Wilbur declines to comment on talks regarding the Craft Centre, but he confirms ASC sees “some opportunities” in Michigan. “And those Michigan opportunities are UAW-based facilities.”

Paul Wilbur

Wilbur says he is open to working with the union for any niche-vehicle plant in the U.S., so long as the union is accepting of supplier-level wage rates, which are lower than OEM rates.

“We could never afford to do it at GM’s (wage rate),” Wilbur says, adding ASC wants the lowest labor rates possible. “We’re looking at other states that are non-UAW, and we are looking at Mexico.”

ASC’s current plant in Lansing – a leased facility – appears to have a tenuous future.

“As the Craft Centre goes away, our SSR (plant) will go with it,” Wilbur say. “But we have more uses for that facility as well. We are investigating some additional opportunities that are coming up with our facility.”

Wilbur describes the SSR program as a “great” success, although production never met GM’s anticipated volume of 15,000 vehicles annually.. ASC says the 23,000 built since fall 2003 exceeded the supplier’s goal of 10,000 units per year.

“It was a tremendous learning lab,” Wilbur says of the SSR. “We know now that we can be competitive in these low volume with this type of protocol, this kind of approach. And our business case works.”

ASC is not alone in pushing its model for a niche-vehicle plant in North America. Competitor Magna Steyr AG & Co. KG already has such a plant in Graz, Austria, and has been advancing with a similar model since 2001 for North America.(See related story: Graz Approaches Global Vision)

Wilbur says the economic benefits are tremendous for low-volume vehicle programs done by an independent supplier, rather than at an OEM plant, but he says ASC and Magna Steyr are not in a race to have the first niche plant in North America.

“Their approach is a little different,” Wilbur says of Magna Steyr. “When they say niche vehicle, they still mean high volume. In Graz, Austria, they will still do 70,000 to 100,000-unit vehicles.”

ASC, on the other hand, could accommodate up to five auto maker customers and build up to 50,000 vehicles annually.

“It’s a different mindset,” Wilbur says. “We’re not geared for high volume, and we’re not intending to do high volume. Quite frankly, high volume from a Magna plant feels like another mouth to feed for an auto maker. So I don’t necessarily buy into that model. But in low volumes, I’m all over it.”

Meanwhile, ASC unveils four new concept cars, some of which could qualify as low-volume niche vehicles the supplier would like to build:

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