In the past few months there has been an ever increasing move to push tooling and manufacturing overseas to China. This sudden blind-leading-the-blind mentality leads me to some questions for the Big 3 and their major Tier One suppliers.
COST SAVINGS: These moves are being touted as a cost savings. Who will see these cost savings? Did Ford, GM and Chrysler offer price reductions when they saved millions of dollars by moving U.S. jobs to Mexico or through their online bidding wars?
MANUFACTURING OVERSEAS: Has anyone really sat down and determined if it is more cost effective to have tools and parts built overseas? They claim that tools and parts are 40% cheaper and lead times are reduced by 25%, but this is only on paper. How many companies have had to send tools and parts back for repairs, rework or tooling adjustments?
Not only are PPAPs and components weeks late, but tens of thousands of dollars over budget.
Who will pay for these cost overruns? The Chinese companies? Probably not, since they can't afford to absorb those kinds of losses. The Big 3, which are driving the move overseas? Probably not, because they would then have to admit it wasn't a cost savings after all. The U.S. companies that were told they had to go overseas in order to get the business? Bingo!
LOST AMERICAN JOBS: Who will be buying these vehicles? Are the Chinese people working in sweatshops going to be picking up the slack and buying the cars that out-of-work U.S. workers can no longer afford? When U.S. industrial jobs moved to Mexico, did the Big 3 see a sudden rise in the cars sold in Mexico?
If the Big 3 wants TRUE cost savings, you should take off the blinders and look internally. Walk through your plants and look at the way you are doing business and ask yourself if you would do business with a vendor if they ran their shops the same way.