Despite massive restructuring, GM Keeps Rollin'

[Flybrian]

Despite massive restructuring, thousands of buyouts...

GM keeps rollin'

Brett Clanton / The Detroit News

Link to Original Artcle @ DetNews

John Brooks works at the Orion Township assembly plant, where more than one third of 2,700 workers took cash buyouts or early retirement packages.

ORION TOWNSHIP -- It's hard to say which is more astonishing: that General Motors Corp. is cutting nearly 35,000 U.S. factory jobs this year or that the automaker's plants, by all accounts, are still running smoothly amid the jaw-dropping downsizing.

There have been small hiccups along the way, and more are possible as thousands of GM workers depart in waves through December and the automaker races to train legions of replacements.

But a look inside GM's Orion Township assembly plant this month -- where more than a third of the 2,700 workers took cash buyouts or early retirement packages -- suggests the transition is going better than most had anticipated.

The factory, home to the Pontiac G6 midsize sedan, is running at roughly the same speed it did before the buyout program. Quality levels have not slipped. And replacement workers say they have been readily accepted by the old-timers, even though many are new to jobs on a modern vehicle assembly line.

"They made us feel real welcome," said Tammy Grimes, 48, who arrived in June from bankrupt auto supplier Delphi Corp. under a special deal among GM, Delphi and the United Auto Workers.

Careful planning credited

GM credits the smooth hand-off to months of painstaking planning that tried to anticipate every problem that might arise from the unprecedented turnover.

Experts say it is also a byproduct of hard-fought changes GM has implemented over the years to improve the efficiency and flexibility of its factories.

"In the past, when the process was set up to be more dependent on the individual skill level of the operator, this would have been disastrous," said Ron Harbour, president of Harbour Consulting, a Troy-based firm that produces a closely-watched annual report on auto plant productivity.

Now, with GM relying on a more standardized manufacturing process, inspired by the Japanese, the buyouts likely will have minimal impact on GM's short-term factory output, and will almost certainly create productivity gains later, Harbour said.

Now GM must build on the strength of that start to its post-buyout transition.

After a $10.6 billion loss last year, the automaker's turnaround is beginning to gain momentum and GM must convince Wall Street that its management team knows how to find the way back to profitability.

Perhaps more than ever, GM also wants to set itself apart from Detroit rivals Ford Motor Co. and DaimlerChrysler AG's Chrysler Group, which are showing new signs of trouble.

New vehicles touted

But the real test will be how -- or if -- American consumers respond to a raft of new vehicles GM is introducing this year.

The product offensive, including a redesigned Chevrolet Silverado pickup, GM's top-selling model, is at the heart of an effort to stem decades of U.S. market share losses and improve the perception of GM cars and trucks.

"It's not about surviving anymore," said Pam Mader, manager of the Orion factory. "It's about truly being the best."

The buyout program has created a unique challenge for Mader and her team, who continue to be assigned aggressive performance targets even as her plant's work force undergoes seismic changes.

The Orion plant is in the process of shedding 986 of the 2,695 workers on the job in March, when GM and the UAW reached a deal on the historic buyout and early retirement plan, officially known as the "special accelerated attrition" program. But at no point has the assembly line stopped cranking out vehicles.

With Pontiac G6 sales on the rise and the recent addition of a convertible model, the plant kicked into high gear and even added Saturday hours.

"I'm too young to retire," says Chuck Becker, who is one of about 260 replacement workers at the Orion Township assembly plant who have come from Delphi, a former GM subsidiary spun off in 1999.

Workers have been replaced

GM had to act quickly to plug holes created by the buyouts. In what may seem counter to GM's cost-cutting goals, the automaker has replaced every one of the 620 Orion workers who have left through a buyout or early retirement.

Each week, a new group of replacements completes a five-day training course that preps them to take over for one of the departing workers.

They begin with an orientation and class time to discuss safety and details of the job. Then, there's a ropes course in back of the plant to teach teamwork, followed by job-shadowing, test runs on the assembly line and one-on-one feedback sessions.

On a recent tour of the factory, plant superintendent Don Arthur joked that with all the new blood, it might be a good idea to stay off the path where new forklift drivers learn the ropes.

"The green aisle," he said, pointing to a narrow area hugging the plant wall, "is a very good place to be."

But many newcomers have experience in manufacturing, even if they've never worked a modern auto assembly line.

Take Chuck Becker. Prior to landing at GM's Orion plant this summer, he made steering components at a Delphi plant in Saginaw. When the bankrupt parts maker announced plans to close or sell the Saginaw plant, Becker, 54, jumped ship.

Now he hops a van each day with half a dozen other former Delphi workers for the 75-minute drive to Orion, and counts his blessings for the opportunity.

"I'm too young to retire," he said.

About 260 replacement workers in Orion have come from Delphi, a former GM subsidiary spun off in 1999 that will return 5,000 workers to the automaker in coming months. Another 64 are from the GM jobs bank, a pool of idled workers earning nearly full pay despite there being no work for them. And 300 temporary workers were hired by referral or off the street at about $18 per hour with no benefits. A typical UAW plant worker earns closer to $27 per hour and gets a pension and top-shelf medical benefits.

Payroll will shrink in time

Once the buyout program is completed and the temporary workers leave, there will be fewer workers on payroll.

"We don't anticipate the need to replace all the employees who participated in the attrition program," said GM spokeswoman Katie McBride, declining to specify how many hourly workers GM will eventually have left.

The buyout program, a key piece of the automaker's North American turnaround plan, aimed to usher out thousands of retirement-eligible workers as GM moves to close all or part of 12 factories by 2008.

But a better-than-expected response -- nearly 35,000 of GM's 113,000 U.S. hourly workers signed up -- left the automaker with many holes to fill to keep its plants running.

Early on, the fear was that GM's quality would take a hit as it put a sea of inexperienced replacement workers on the job. But analysts, workers and union officials at plants other than Orion also said the process is going smoothly.

"I can't say we've missed a lick yet," said Jim Kaster, president of UAW Local 1714, which represents workers at a GM small car plant in Lordstown, Ohio, that will lose 900 of 1,450 workers.

"I thought quality would suffer greatly," said Eldon Renaud, president of UAW Local 2164, which represents GM workers at the Chevy Corvette plant in Bowling Green, Ky. But he has not noticed many slip-ups as 300 of the plant's 1,075 workers make for the exits. In fact, new workers have come up to speed faster than he thought they would.

"It's not rocket science," he said.

Still, the entire process has been a poignant reminder to the UAW of its declining ranks within the domestic auto industry. After peaking at 1.5 million in the late 1970s, UAW membership now hovers under 600,000.

Since workers began leaving in July, Mike Dunne, chairman of UAW Local 5960, which represents workers in Orion, has lost count of the farewell parties he has attended for long-time co-workers and friends.

"We're going broke throwing them," he said.

But Dunne is hopeful that GM is making the right moves no matter how painful they may be now.

"GM has turned the corner," he said, "and we're on the way back."

You can reach Brett Clanton at (313) 222-2612 or [email protected].

[bowtie_dude]

Now, with GM relying on a more standardized manufacturing process, inspired by the Japanese

That were inspired by two AMERICAN engineers in the 50s. As if the Japanese EVER pioneered anything on their own...

[I hope GMRULES again]

That were inspired by two AMERICAN engineers in the 50s.  As if the Japanese EVER pioneered anything on their own...

187965[/snapback]

What were their names again?

[bowtie_dude]

What were their names again?

188091[/snapback]

http://en.wikipedia.org/wiki/Armand_V._Feigenbaum

[Guest Josh]

Umm...this article is wrong. Overtime is up at plants due to mistakes and teardowns having to be done.

The new temps and full-time transfer employees are causing head-aches.

[ellives]

And your source for this insight would be?

Change is disruptive and painful as a result but all have figured out the traditional strategy of letting the chips fall where the may has failed big time. The key to manufacturing in today's world is managing change successfully. If you can't do it, you fail.

Umm...this article is wrong. Overtime is up at plants due to mistakes and teardowns having to be done.

The new temps and full-time transfer employees are causing head-aches.

188126[/snapback]

[I hope GMRULES again]

http://en.wikipedia.org/wiki/Armand_V._Feigenbaum

188096[/snapback]

Did Armand V. Feigenbaum teach Toyota the Toyota production system?

[ellives]

Did Armand V. Feigenbaum  teach Toyota the Toyota production system?

189064[/snapback]

Um no. I think the point was the "Toyota Production System" was based on the work these guys did. This premise would dismiss the commonly held myth that Toyota actually invented their "System" or anything else for that matter. They did indeed "develop" their system but it was actually based on others' work as so much of what comes out of Japan, Inc. is.

[longtooth]

We're hammered over and over again with " Yes, it's GMS"! (Global Manufacturing Standard).

Assembling the 4 mini-van/crossover clones for GM in Doraville GA only demonstrates the lemming-like adherence to following the leader over the precipice. Defects in bodywork and body fit which were designed into the product are as apparent today as when the redesign began to be cranked out two years ago.

Our plant manager's told us that 80% (?!) of the vehicles are destined for fleet use. Unsold Uplanders are languishing on dealer lots (backlots) while consumers ignore them in droves.

Come to the issue of "Temp" or replacement workers; since the assembly jobs are more or less standardized, with any luck, an individual can learn most of the jobs here in under 3 days if they're reasonably attentive. The larger issue is that while the pay looks good in the near term, there's no investing on the part of the "Temp" who knows going in that he or she'll never have a stake in securing a future toiling for the Corporation.

Last Friday, we at Doraville said goodbye to all of our "Temps", all of the remaining "Buy-Outs", and a large group of retirees. The plant goes to one shift beginning on Tuesday 9-05-06. At 6 am., no less. My Supervisor told me that some areas are getting up to 20 employees who're unfamiliar with the work they'll be doing as the re-shuffle/redeployment goes forward. So, picture 500 plus cranky 50-somethings who've just come onto the 1st shift after years of working 3 to midnight trying to sort out things on their new jobs while bleary-eyed and having their body-clocks straining to come to terms with the out of whack situation.

Doraville will be shedding additional hundreds of workers who'll be transferring to other GM facilities thru the end of this year and into '07. I wish everone well, as I've done this now myself, going on 3 times. Ah, the shifting fortunes of World Trade, the Global Marketplace. I know that at age 50, with 30 plus years working for the same employer, that I am an anachronism. No one stays in any one place anymore doing unskilled manual labor for that long. This'll be my last move though. Going back to my native soil up North by some turn of luck, and I thank God for it. I wish GM well. We've had a symbiotic relationship these past decades. I, and many thousands of individuals will depend on a lean, healthy and prosperous GM for years to come.

[CARBIZ]

I will agree that the fit and finish on the Uplander isn't the best (the gap between the rear bumper and the rear quarter panel would fit a couple credit cards!), but up here in the land of $4.50 a gallon gas, we do well with these vans.

I think GM doesn't market them south of the border. UP here, we are in a price war with Chrysler and the LS sells for $18,999. We are sold out and wish we had 20 more!

The truth is, for all their flaws, a Sienna is more than $10,000 more. Although we would all like to see world class products from GM in every market segment, sometimes just being able to kick ass on price is awesome.

I know this forces GM (and Chrysler) to the bottom of the food chain, but until the new vans are ready in two years, we are selling all we can get.

Our dealership has sold 2 Tahoes this year, and sells at least 15 Uplanders a month!

[longtooth]

I will agree that the fit and finish on the Uplander isn't the best (the gap between the rear bumper and the rear quarter panel would fit a couple credit cards!), but up here in the land of $4.50 a gallon gas, we do well with these vans.

  I think GM doesn't market them south of the border.  UP here, we are in a price war with Chrysler and the LS sells for $18,999.  We are sold out and wish we had 20 more!

  The truth is, for all their flaws, a Sienna is more than $10,000 more.  Although we would all like to see world class products from GM in every market segment, sometimes just being able to kick ass on price is awesome.

  I know this forces GM (and Chrysler) to the bottom of the food chain, but until the new vans are ready in two years, we are selling all we can get.

  Our dealership has sold 2 Tahoes  this year, and sells at least 15 Uplanders a month!

189129[/snapback]

'Biz, I see them going to Mexico frequently enough. A smattering go to Saudi Arabia as well. See a lot of the short wheel base Pontiacs going to Canada as they're not being sold in the US after the '06 model year.

We changed over to run the '06's in mid July of '05. With downweeks and Christmas shutdown, the '06's were produced for just under 9 months. We started producing the '07's on May 12, 2006. Through last Friday, just over 36,000 of all the models combined have been produced. Speculation (mine primarily) is that up to 60,000 total will be made for '07, after that know one's saying.

Management has spent a prodigious amount of cash to rework numerous flaws in some vehicles to enhance their "saleability". We're scurrying to build this out before years end I think.