Denso: Unskilled Workforce Threatens Industry Expansion

TRAVERSE CITY, MI – Denso says its North American expansion plans are on track and won’t be derailed by a dwindling skilled U.S. workforce. 

David Grimmer, president-Denso Mfg. Canada, says young people in North America aren’t interested in manufacturing because of an incorrect image of what the jobs entail, noting the auto industry has a “branding challenge” it must address.

If auto makers and suppliers don’t join together to change the perception of the industry and work to recruit young people, the problem only will exacerbate, he says.

“If we don’t have all the people with the right skills at the right time, it not only is going to slow (the industry) but also some of the (continuous improvement) we need to be doing,” Grimmer says at the CAR Management Briefing Seminars here.

The economic crisis of 2008, when the automotive industry shed thousands of jobs, only worsened the industry’s image, he says, noting the recession was not just a blow to the economy, “but to the very essence and survival of manufacturing.”

Grimmer says the industry should follow Japan’s lead, which targets students in junior high school by selling them on the opportunities the manufacturing industry offers and, in some cases, even putting them on the payroll.

“A lot of people talk about training academies, and that’s great,” he says. “But let’s take it a step further and get young people interested in the idea and concept of technology and manufacturing.”

The lack of a skilled workforce hasn’t put the brakes on Denso’s North American expansion plans. The supplier plans to invest $1 billion in the region `over the next four years to increase the localization of products, processes and research and development.

The expansion is expected to add some 2,000 jobs in multiple product sectors, particularly powertrain, thermal systems and electronics, at one of the largest suppliers in the world.

Unlike most auto makers and suppliers, Denso designs and builds its own manufacturing systems, including robots, which increases its need for a highly skilled workforce, Grimmer says.

While expensive, building your own manufacturing equipment provides a competitive advantage.

“You can better optimize the relationship between processes and design, and in-house expertise is elevated,” he says. “We feel we have the competitive advantage for process speeds, accuracy and footprints.”

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