Although General Motors announced on July 28 that it was going to be spending $5-billion “outside of mature markets” for product development, it is worth noting that the company announced on April 30 that it would be spending $5.4-billion in its most-mature market, the U.S.
On this past Tuesday, GM announced that it was going to be investing $877-million in a plant that qualified for AARP membership some years ago, Flint Assembly, which went into production back in 1947 (which, generationally speaking, makes it a Baby Boomer, as that appellation applies to those who were born in 1946 (to ’64)).
Flint Assembly is one of the GM plants that is running rather rapidly right now, as it is where heavy-duty versions of the Chevrolet Silverado and GMC Sierra are built, as well as light-duty Silverados.
Through July, Silverado deliveries are up 17.5% (to 332,202) and Sierra’s up 9% (to 120,658), so that’s a lot of trucks that need to be produced (these numbers are for the trucks overall, not just coming out of Flint alone).
The $877-million will be spent to build a new body shop, locating it closer to the Flint Metal Center, where various sheet metal and other parts are produced. Explained Cathy Clegg, GM North America Manufacturing and Labor Relations vice president, “This investment will allow us to use a more innovative approach to deliver material between two critical facilities, reducing handling and the time it takes to ship parts.”
In other words, simplifying and speeding logistics.
The body shop will measure 883,000-square-feet and is expected to be completed by 2018.
It is worth noting that since 2011 GM has announced that it is keeping Flint Assembly productive through investments that will be in excess of $1.8-billion.
Flint Assembly may be mature, but that’s nothing that some upgraded equipment, tooling, and facilities can’t improve.
To say that Jeep sales over the past many months have been climbing higher than a Wrangler on a steep grade in Moab would be a profound understatement. It seems as though people just can’t get enough of the vehicles.
Of course, by and large, most people don’t take advantage of the “go anywhere, do anything” capabilities of many of the vehicles in the Jeep lineup. Rather, they simply want to present as though they can.
Talk to any of the people who work at any of the companies that offer “off-road” capable vehicles—Jeep or otherwise—and they’ll acknowledge that the number of buyers of SUVs who actually take their vehicles off road is on the order of about 15%. And that’s being generous.
Which occurred when learning that less than eight months after launching its All-Terrain T/A KO2 tires in North America, BFGoodrich has sold more than one-million of them.
Assuming four tires per vehicle, that’s 250,000. A lot of vehicles are rolling on those tires. But where?
The tire was developed to be able to deal with tough conditions. Computer modeling was used, for example, to predict object paths that might result in splits and snags in the sidewall, which would result in failure. So the tire was designed with split and bruise-resistant sidewall rubber and a thicker, extended shoulder. According to BFGoodrich, the tire is 20% stronger than its predecessor in this off-road capability.
Then in the tread area, there is a new design—a locking pattern that results in uniform wear—and a new rubber formulation—that resists chips and tears on gravel. There are even stone ejectors designed into the tread. Overall, they calculate that the KO2 tire last twice as long as its predecessor on gravel and 15% longer on asphalt.
And on the subject of the tread design, the tire company has calculated that it provides 10% greater traction in the mud and 19% greater traction in the snow, thanks to such features as side-biter lugs in the sidewall, raised bars in the shoulder, and 3D sipes.
Overall, the KO2 was developed to deal with conditions such as those presented during racing in Baja.
We wonder: how many will racing to the Imperial Valley Mall in El Centro in late September to participate in the Rigid Industries Imperial Valley 250, and how many will be speeding to Macy’s? Probably more of the latter than the former.
Sergio Marchionne has probably caused more automotive executives afraid to answer their phone or open their email than anyone in a long, long time.
That’s because Marchionne has been talking about some sort of tie-up with another company. Like an acquisition. And chances are he wouldn’t be the one doing the acquiring.
But even though he may be setting in motion a whole lot of eye rolls, in many regards he is absolutely right: There is too much redundancy in the industry and that can be ill-afforded by companies that are constantly walking the tightrope over a financial abyss.
Why should so many companies all develop the same parts, components, subassemblies, systems, etc., especially when, fundamentally, there isn’t a heck of a lot of discernable consumer difference between them?
That is, arguably, just waste. Or as the Japanese word has it, a word that seems more fundamentally descriptive: muda.
But maybe it doesn’t have to be an acquisition.
Maybe it just could be collaboration.
Maybe competitive companies could work together on the fundamentals and then create their distinctiveness on top of and within (e.g., tuning of everything from the suspension setup to the engine calibration) the common elements.
This seems to be what the Renault-Nissan Alliance and Daimler are doing.
Last week they announced COMPAS: Cooperation Manufacturing Plant Aguascalientes.
Or more plainly: the two organizations are investing $1-billion in a manufacturing plant that will produce compact premium vehicles. First there will be an Infiniti in 2017. It will be followed by a Mercedes in 2018.
Glaucio Leite, Chief Quality Officer (CQO) for COMPAS, a 24-year veteran at Daimler (his last position in Germany was overseeing the preparations for the final assembly of the next-generation E-Class at the Mercedes-Benz Sindelfingen), put his figure on some of the advantages of the approach: "By incorporating the best from both companies in terms of manufacturing and quality processes, we will produce top-quality products, maximize resources, and optimize costs at the same time. We are also making sure that both brands' quality requirements and identities are safeguarded.”
Are there any boxes they’re not checking?
Realize that they’re producing premium cars, not mainstream. Arguably, this means that the demands are much higher in terms of the expectations for the vehicles.
And yet they’re doing it.
Renault-Nissan Alliance and Daimler have been working together under a strategic cooperation agreement for five years.
Although there isn’t a whole lot of fuss made about it, it seems as though it must be effective.
Maybe some other executive(s) might go down this road with Marchionne.
On a recent trip to Los Angeles, while flipping through the Times, I had one of those “damn, I can’t believe I’m seeing this” moments.
It was an ad.
It was this:
An ad for a Detroit-built product that’s on offer at a jewelry shop in Beverly Hills.
Here we are, entering the age of the Apple Watch, and smack-dab in the middle of it is an analog timekeeping device that’s out of Detroit.
Clearly, a Shinola watch is an aspirational object.
And when I sat on the plane going back to Detroit, I noticed that there were more than a few ostensible Millennials, women and men, who had Shinolas on their wrists.
The point here is not to shill for Shinola.
It is to make the point that here we are in 2015 and Detroit is being presented in not merely a good light, but a klieg light.
And it makes me wonder why the Detroit automakers don’t somehow capitalize on this, as well.
Yes, Chrysler went down this road with its 2011 Super Bowl ad with Eminem. It kept it up for a while with the likes of Ndamukong Suh and John Varvatos.
But somehow this Shinola ad does a better job of telegraphing the message: this is well-built and if you have one, it doesn’t matter if you’re in Stuttgart, Ingolstadt, Tokyo, or elsewhere, you can wear it with confidence and pride.
Shinola is based in the A. Alfred Taubman Center for Design Education in Detroit. It is a building of the College for Creative Studies. Plenty of designers who are working in Dearborn, Warren and Auburn Hills—to say nothing of Stuttgart, Ingolstadt, Tokyo, and elsewhere—studied at CCS.
That building, the Argonaut Building, was designed by the legendary Albert Kahn. It once housed the General Motors Research Laboratory.
You don’t get much more Motown than that.
And there’s Shinola. “Built in Detroit and Made to Last” is one of their slogans.
Shinola is capitalizing on Detroit. On it heritage of making stuff. On its growing reputation of a city where there is literally a rebirth of arts and culture, where arguably the word “renaissance” isn’t just appended to the name of a building. (Yes, a building that was initiated by the efforts of Henry Ford II and is now the headquarters of GM.)
Why the auto makers don’t do this is a mystery to me. They may want to resonate in New York and Los Angeles. But the people who matter there resonate with Detroit.
It’s the classic story of a tinkerer in a garage starting something and then having it go big. Really big. Internationally big. So big that even people who don’t know much about the technology know what it is. Or at least recognize it.
It’s a story that started in a small workshop outside of Bergamo, Italy, in 1961. It was called Officine Meccaniche di Sombreno.
The issue was one of securing brake discs when there weren’t many readily available with the right characteristics. That was in 1964.
By 1975, Enzo Ferrari paid a visit to the operation. And the rest is history.
Who doesn’t recognize this:
Dan Sanberg is president and CEO of Brembo North America, which is headquartered in Plymouth, Michigan. About an hour-and-a-half west there’s the manufacturing facility in Homer, Michigan, where, Sanberg says, they’re manufacturing discs, calipers, and corner modules. Where they’re investing $100-million for a casting facility. Yes, that’s right: they’re going to be casting iron and aluminum in Michigan.
Brembo is all about premium braking technology. Braking systems for Ferrari, of course, but also cars like the Viper and the Corvette.
Of the company’s 7,700 employees around the world, 10% are hard at it, working on R&D.
And Sanberg points out that because this is an Italian company, aesthetics matter. Yes, there are people back in Italy who look at the calipers from the point of view of strictly their artistic appeal.
Sanberg talks about trends and development in such things as materials and applications, about the challenges and the future of braking systems on this edition of “Autoline After Hours.”
Host John McElroy, Richard Truett of Automotive News, and ask Sanberg about what has got to be the most-storied brake company on the planet (its brakes have been on vehicles—cars and motorcycles—that have won more than 300 championships since the company first went racing—Formula One racing—in ’75.
In addition to which, McElroy, Truett and I discuss a number of other subjects, including the IIHS testing of the Ford F-150, which Automotive News played an important role.
That, the calculations of fuel-cell-generated water, FCA’s earnings and much more are discussed right here: