Jeep to the Rescue

With a grin as wide as a 7-slot Jeep grille, DaimlerChrysler Corp. President Dieter Zetsche takes Job One of the new '02 Jeep Liberty for a joy ride during the opening of the new $1 billion Toledo North, OH, plant.

“This really is an emotional moment for me. It's the best SUV which ever has been launched into the marketplace in this world,” says Mr. Zetsche, before a mock Liberty-napping of the Cherokee replacement that took 27 months to bring to fruition (see related story p. 57).

He's all business when it comes to the importance of the first all-new Jeep since 1992, at a time when the Chrysler Group needs strong product to augment its turnaround plan. Liberty is “nothing less and nothing more than the future of our company,” says Mr. Zetsche during the April 30 ceremony. “I'm extremely happy that this is exactly the time when the Jeep Liberty will hit the marketplace.”

The '02 Liberty must continue to hit the quality numbers achieved early in the launch, and the German chief is hoping sales will warrant dedicating the entire plant — it is flexible enough to accommodate two products while piloting a third — to Liberty production.

Capacity is 200,000 units on two shifts (2,100 workers) or 50 vehicles per hour, up from 38 per hour when the plan was for three shifts. That scenario was scrapped earlier this year as part of DCC's restructuring plan. The company invested in brick and mortar and new tooling — including another body sealing station — to accommodate the additional 12 vehicles per hour, expanding the facility's size to 2,078,000 sq.-ft. (193,046 sq. m)

Mr. Zetsche says he hopes demand will make a third shift of 900 workers necessary. It would help offset the loss of as many as 2,000 jobs later this year from 6,200 at the three Toledo assembly plants. Cherokee production will cease at Toledo Parkway, and Wrangler production will be reduced to a single shift at the Stickney Avenue facility.

On a more positive note, Ward's AutoWorld learns the construction underway at Stickney is to add a special off-road “Rubicon” model of the Wrangler in 2003.

Jeep is a “fantastic brand with an unbelievable heritage” and a potential DCC has not fully leveraged, adds Mr. Zetsche, who would say only that he is “studying plans” to extend the lineup.

DCC won't say when the job cuts will come, but the requirement to give 60 days notice means the earliest it could happen is June 22. Some workers will be transferred to Toledo North, and DCC says it hopes attrition will keep layoffs to a minimum.

Toledo North is heavily automated compared to Parkway, requiring half the number of workers to assemble Liberty as the outgoing Cherokee. “We'd be foolish to spend money on a new facility and not get a more efficient process,” says Gary Henson, vice president-manufacturing. Labor count at the new plant includes about 300 in the body shop where welding is 100% automated (the first DCC plant to do so), 300 in the paint operations and the remainder in assembly. About 315 workers are skilled trades. At the much-older Cherokee plant, 650 people work in the body shop alone.

Even management is streamlined at Toledo North. The 113 salaried workers represent 67% the size of a traditional team. A new team structure — there are 38 work teams in assembly — is behind that reduction. Advisors report directly to the area manager and oversee four team leaders who, in turn, supervise line workers. All are hourly employees. The area manager reports to the department head who answers to the plant manager.

“This is our best attempt to date at the team concept and empowerment of the workforce,” notes Mr. Henson. “It's a huge cultural change.”

Toledo North hit its capacity rate of 800 units per day two months ahead of its July target because the quality was in place to expedite the ramp-up.

Mr. Zetsche says Toledo North will build 117,000 units this year and sell 70,000-80,000. His hope is the plant will use most of its 200,000-unit capacity next year, selling about 80% in North America.

As the sole source, Toledo will assemble left- and right-hand drive, gas and diesel, and knockdown Liberties for kit assembly elsewhere in the world, says Thomas Sidlik, DCC general manager of Jeep operations.

Some 431 suppliers provide parts. Seven deliver components just-in-time and 36 arrive in sequence. Sequenced parts are unloaded automatically off trucks and into the plant without being touched by workers or forklifts. The goal is less than two hours of material on the line and no more than 24 hours' stock inside the plant.

Liberty hits showrooms in May and the advertising campaign: “Jeep: There's only one” begins this month.