Global Engine Manufacturing Alliance World Engine Plant: Open for Business
Two Dundee, Mich., plants will build 840,000 engines annually
Plant efficiencies deliver premium engine features at entry-level price
Innovative GEMA operation aims at new productivity benchmark for engine plants
“Global Engine Manufacturing Alliance Begins Volume Production of World Engine” b-roll package available from the Broadcast Video library at http://www.thenewsmarket.com/Chrysler.
Dundee, Mich., Oct 3, 2005 –
The Global Engine Manufacturing Alliance (GEMA) launched volume production today of the much-anticipated World Engine in the first of two plants opening here. This plant holds the promise of a new standard of global engine manufacturing.
To commemorate the Job One event, Michigan Gov. Jennifer Granholm joined Chrysler Group President and CEO Tom LaSorda, the United Auto Workers union and other company officials at the Dundee, Mich. facility.
Each GEMA plant will have the capacity to build 420,000 engines annually. The second GEMA plant in Dundee is scheduled to launch in 13 months. Altogether, 530 new jobs will be created, combined with an overall investment of $803 million.
“Michigan remains the heart of the auto industry, and is proving here in Dundee that it can continue to compete globally in securing the high-tech automotive jobs of the future,” Granholm said. “This project is an excellent example of how the local and state government can partner with private business to invest in, and train a highly qualified workforce.”
“GEMA represents a whole new business model for engine development — one that leverages the combined capabilities of its partners and economies of scale in order to generate breakthrough improvement,” said LaSorda. “These four-cylinder engines will provide exceptional performance, fuel efficiency, reliability and refinement. In short, the World Engine is the right product at the right time.”
World’s Largest Engine Operation
The two Dundee plants are part of a five-factory global venture building a family of 1.8-liter, 2.0-liter and 2.4-liter engines jointly developed by DaimlerChrysler, Hyundai Motor Company and Mitsubishi Motors Corporation. When all five plants are fully operational, the combined project will be the largest engine manufacturing operation in the world. Annual production will reach 1.8 million units, including production sites in Asan and Hwasung, South Korea, and Shiga, Japan.
“This project will allow DaimlerChrysler to realize annual savings of $100 million and attain a leading position in the market for the world’s best four-cylinder engines,” said Dr. Rüdiger Grube, DaimlerChrysler Board of Management member responsible for Corporate Development and Northeast Asia Operations. “The Global Engine Manufacturing Alliance enables us to fully benefit from our strategic partnerships and achieve maximum economies of scale.”
Manufacturing Efficiencies Pay for Premium Engine Features
GEMA President Bruce Coventry credits the alliance’s practice of focusing exclusively on its core business as a key element in GEMA’s efficient operation.
“Our expertise and value to the customer is in the designing, high-precision machining and assembling of engine blocks, cranks and heads,” Coventry said. “Virtually all other support operations are provided by our Integrated Service Providers, or ISPs – experts in each of their respective areas.”
The ISPs use their refined and proven business practices to provide GEMA with efficient operations at a cost savings. For example, the company responsible for the design and construction of the plant now provides building maintenance. Tool set-up and consigned inventory is managed by a company who specializes in tooling. These are only two of 45 examples of how GEMA is leveraging expertise for maximum efficiencies.
The significant savings achieved in design, purchasing and manufacturing is going back into the product itself in the form of technology and refinement. Features such as variable valve timing, high-pressure die-cast aluminum engine block, forged-steel crankshaft and select-fit pistons, tappets and bearings are not typically found nor expected in entry-level, four-cylinder vehicles.
Innovative Work Scheduling
An innovative work schedule increases plant productivity but still gives employees more family time. Three crews work four 10-hour straight-time shifts per week. A typical production schedule provides 80 hours per week of production time, while the GEMA schedule provides 120 hours of production time in one week. Compared to a traditional plant schedule, individual employees work 49 fewer days per year, but the plant operates 49 more days.
“To compete in a global industry and maintain market leadership, it is necessary to produce the highest quality engines utilizing the most efficient methods available,” said Nate Gooden, UAW Vice President of the UAW’s DaimlerChrysler Division and member of the DaimlerChrysler Supervisory Board. “As market pressures change, organizations need to adapt and be flexible enough to meet new demands. Both parties recognized early in the negotiation process that the distinct culture at GEMA was a strategic competitive advantage and required an agreement that promoted an environment that emphasized operational flexibility, jointness, world-class quality and productivity.”
A rigorous training program with more than 1,500 hours of orientation and training has yielded a highly qualified and dedicated workforce. The employee teams are adopting the latest practices of lean production and quality control. Employee absenteeism is under two percent, well below the industry average.
Global Engine Manufacturing Alliance Joint Venture
The World Engine was co-developed under a joint venture between DaimlerChrysler, Hyundai Motor Company and Mitsubishi Motors for the Global Engine Manufacturing Alliance.
While Hyundai had the lead design responsibility for the base engine, the Chrysler Group and Mitsubishi made significant engineering contributions to the design. Through the involvement of all three automakers, durability testing for the World Engine exceeded 16 million customer equivalent miles. Additionally, partners have shared best practices and lessons learned from past and current experiences, resulting in improved refinement, quality and durability.
Chrysler Group engineering led the development of key technologies that will give its customers high-value benefits in cost-efficient engines. These technologies include intake manifold control valves, Dual Variable Valve Timing (VVT), both launching in the U.S. first in Chrysler Group versions of the World Engine.
By optimizing the partners’ strengths, global economies of scale and the latest practices in flexible teams and machines, GEMA aims to set a new benchmark in engine plant productivity.