The Big 3, especially General Motors, can pat themselves on the back for becoming more productive. But they would be better off if they took the industry's latest efficiency study as a kick in the pants. They simply must get better.
To refresh: The 1997 Harbour Report noted that GM, on average, uses 3.5 workers to build each vehicle in North America. Just four years ago, GM needed nearly 4.5. Chrysler also continues to improve and ranks just behind Ford.
Nissan, meanwhile, again led, at 2.2 workers per vehicle. Honda and Toyota are close behind.
Sure, the study carries some asterisks. GM's average, for example, includes plants in Mexico. They drag down GM's rating. What can be a smart move in Mexico - using low-cost workers to do the work of expensive machinery - is a minus by Harbour's standards. What's more, Nissan's Mexican plants aren't counted in the survey. And they're very inefficient these days because of low volume.
Still, one gnawing figure sticks out above the rest: GM spends $1,917 on labor for every vehicle it builds in North America. Nissan and Toyota spend about $1,200. In an era that measures success in pennies, the difference is huge.
GM, to its credit, is making great strides. As Harbour notes, the design of the new Chevrolet Malibu requires 20 percent fewer workers. Before long, most of GM's vehicles will be built the same way.
The company is enduring a two-month strike in Pontiac, Mich., over such changes. It's preparing to build a new pickup at the plant, but the UAW is fighting GM's plan to use 300 fewer workers.
Somehow, GM must convince its workers that customers don't care how many workers it takes to build a car or truck. What they do want is low cost, high quality and a dash of pizazz.
The stakes? Life and death. As Harbour warns, the U.S. market isn't going to get much bigger, yet the Japanese are adding more plants. That combination spells trouble.
'Somebody is going to die,' says consultant Ron Harbour. Yes, he notes, the Big 3 can improve. The question is whether they realize how urgent the need is. 'If they don't, they won't be around.'