James Harbour: The Factory Man Speaks

Automation World Editor in Chief Gary Mintchell spoke recently with noted automotive industry analyst James Harbour about some of the latest industry issues

James E. Harbour
James E. Harbour
Automation World: Where do problems in auto manufacturing and the auto industry lie these days?
James Harbour: For a large number of years, say, from 1990 on, there has been no focus on manufacturing at all in the United States. They’ve sourced it out to the leanest manufacturer they could find. They said, “Since we can’t address the cost of labor contracts plus regulations and OHSA (Occupational Safety and Health Administration) requirements, let’s send manufacturing to Mexico. We don’t want to straighten it out, so let’s send it out.” That was a mighty mistake, evident in developing Delphi and Visteon as the component suppliers who eventually took their manufacturing out of the country. The auto companies said, “Manufacturing isn’t our focus, so let’s just assemble cars, and maybe do stamping, engines and transmissions.”

Auto industry problems today have nothing to do with quality and productivity. Thirty years ago, it took 40 hours to build a vehicle. Now, it’s between 16 to 18 hours. The thing is, there are so many competitors with 20 million cars worth of capacity sitting waiting to feed the U.S. market. The question now is, who has best product and best sales and marketing? Right now it’s Toyota, Honda and Ford.

AW: There has been a lot of discussion about how the Japanese used Lean Manufacturing techniques to power their rise over the Big Three. Is getting companies to Lean still a crucial goal? Was Lean part of the problem with Toyota’s current recall situation?
Harbour: Understand something: About 15 percent of the cost of the product is involved in manufacturing. I can get you as Lean as you can, but there are still other important areas. Lean has its place on the manufacturing floor, but it also has a place in product engineering. Look at Toyota. If I’m bringing in a new car, I’ll need a new firewall. If I use Lean engineering, I look up designs on the computer and pull up all the firewalls the company builds. At Toyota, they are all the same for sixteen different platforms. Everything is common except for size. The holes are in the same place. Mounting is the same.

Lean is not the problem. Toyota lost another focus. They went with the same engineering staff and started a worldwide expansion. Someone missed one little thing—so I didn’t do the gas pedal right or test for carpet interference. This isn’t a manufacturing problem. Nothing in the plant could be done to stop the hypothetical acceleration problem. It’s a design problem.

AW: In your book “Factory Man,” you offer thoughts for future competitiveness, talking about flexible manufacturing through commonality. Would you describe what you mean?
Harbour: Take another look at Toyota. Not only do they design the firewalls, for example, to be common, then the manufacturing engineering is all in common. So every body shop is common for all Toyota plants. All use the same hammer, have the same welding, paint shop and assembly lines—all common in all 60 plants. All have the same standard bill of process—station 62 in every plant is the same operation.

Talk about flexibility, Honda can build any vehicle in any line in any plant in any country. The issue is very simple. I have common processing, facilities, tooling. There is the commonality to handle multiple platforms—for example, all my positive locating points (PLPs) are all common across all platforms. As long as I have common PLPs, I can build anything anywhere. Toyota has revised its whole body shop system to achieve similar commonality, so they can build different cars on the same line.

James E. Harbour is recognized as a leading automotive industry analyst. After a 28-year career in automotive manufacturing at Ford Motor Co. and Chrysler Corp., he founded Harbour and Associates Inc. in 1980 and began issuing his “Harbour Reports” on manufacturing labor efficiency in 1999. In 2009, he released his autobiography, “Factory Man: How Jim Harbour discovered Toyota’s quality and productivity methods and helped the U.S. auto industry get competitive,” written with James V. Higgins and published by the Society of Manufacturing Engineers (SME).
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