BIRMINGHAM, Ala. - Nissan North America will benefit from a toned-up and leaned-down supplier base this year when it begins its marathon run for U.S. production expansion.
Nissan will cut the ribbon on a $1.5 billion factory later this month in Canton, Miss., starting a schedule of four product launches in eight months. This year also has seen Nissan open a full-scale engine plant in Decherd, Tenn., and a new Maxima production line in Smyrna. Also, construction is underway to add an Altima production line to the Mississippi plant even before it opens officially.
To make all of that possible, the company has had to get its suppliers into better shape, says Emil Hassan, senior vice president for North American manufacturing, purchasing, logistics and quality. Nissan has pushed its suppliers into a system of "integrated manufacturing" in which they produce and deliver components in lock-step with the assembly plant 's own daily production schedule.
Parts are delivered for specific vehicles just as they are needed at the assembly plant, reducing storage and other costs.
"Integrated manufacturing requires a collaborative effort with our supply base where Nissan learns from its suppliers and our suppliers learn from and grow with us," Hassan told an audience last week at the Automotive News Manufacturing Conference in Birmingham.
As an illustration of his suppliers' transformation, Hassan sited the improvement in their ability to deliver parts in sequence with specific model production. He said that in 1999, when Nissan first attempted sequenced delivery at its plant in Smyrna, Tenn., the effort was about 17 percent accurate.
"After a lot of hard work by Nissan and its suppliers, the percentage rose to 95 percent," Hassan said.
He added that the in-sequence results for the new Mississippi plant will be even higher than 95 percent. And the new plant, he said, will require the group to operate under tougher conditions.
"At Smyrna, we currently receive over 50 commodities in-sequence - some from as far away as 750 miles," he said. "During our Canton start-up, we are planning to receive close to 60 commodities, some from as far as 1,000 miles."
The in-sequence parts will represent 44 percent of Nissan's parts content in Mississippi, including engines, interior trim panels and exhaust systems.
The challenge will be that there are very few parts in the pipeline, in case of a production interruption, Hassan said. But that translates to lower transportation and warehousing costs, better quality and improved flexibility. "Sequencing material helps put discipline into our plant and the supplier's.