AutoAlliance on the Comeback Trail

What an impact a year and two new products can make to a plant.

In 1997, workers at AutoAlliance International in Flat Rock, MI, built 100,394 vehicles, less than half of the plant's 240,000-unit capacity. Of those units, about 90,000 were Mazda 626 units; the rest were Ford Probes and Mazda MX-6s, both killed in the summer of 1997.

Fast forward to 1998 and the story at AAI is one of occasional overtime, body shop upgrades and talk of a third vehicle sometime after 2000.

A redesigned Mazda 626 and the addition of the all-new Mercury Cougar have helped boost productionthrough October past the 111,000 unit mark at AAI. Output for the year could end up at about 160,000 units, still less than the plant's capacity but more than the plant has turned out in the two previous years.

Sales of the redesigned 626 are up 22.8% through October vs. year-ago (80,878 vs. 65,837). Union sources say the next Mazda 626 will be designed at Ford's Small Vehicle Center in Cologne, Germany, which means it may share the same platform as the next-generation Mondeo.

The addition of the all-new Mercury Cougar in March 1998 also has been encouraging for workers at the plant. Cougar sales reached nearly 30,000 units through October.

The plant's 2,800 workers, now under the same UAW national contract as the rest of Ford's hourly workers, picked up a few hundred employees. The majority are skilled trades workers who lost their jobs when the Cougar/Thunder-bird plant closed in Lorain, OH. Mr. Willis says their transition into the plant has been smooth.

Ford is targeting Cougar sales of about 50,000 units annually in North America once full production of about 60,000 Cougars is reached at AAI. The car is exported to Europe where it is sold as the Ford Cougar.

That still is below Probe's sales volume. Ford says production could be pushed to 90,000 units if necessary. That type of volume could test AutoAlliance's capacity if Ford adds a third vehicle to the plant in 2002, as AutoAlliance President Bruce Bowman has said.

But these earlier promises have since been toned down. The United Auto Workers union now says that the addition of another vehicle could be a one-for-one, which means two vehicles would remain at the plant. Workers say the only vehicle guaranteed to be at the plant after 2000 is the Mazda 626. AAI officials declined to comment.

Leon Willis, president of UAW Local 3000, says he has heard talk of another vehicle, but nothing is concrete.

Ford is pumping millions to upgrade the plant's Automated Guided Vehicle system in the body shop. The current AGV system is old and not efficient enough for the kind of future production planned for the plant.