Throughout Automotive News' Industry on Trial series, we've looked at wasted capital, duplicated engineering and how economies of scale drive the urge to merge.
Let's set aside the corporate chessboard to focus on people. The bigger a merger, the more people it affects.
Amid industry consolidation, people get overlooked. Complicated deals sweep aside the importance of having good employees staying engaged.
Mergers can create fresh opportunity for a restructured company and its employees. But mergers come with painful cuts.
You lose equipment. You lose technology. You lose talent.
Sadly, auto job levels fluctuate. Sales and production yo-yo year to year. Over time, efficiency gains reduce total industry employment.
Auto people know the pink-slip/early retirement drill. Just in my family: grandfather, brother, father-in-law, cousins, nieces and nephews. Sooner or later, laid off. Not always rehired.
My die-maker grandfather ended his career managing a General Motors parts plant. His favorite memory was one annual outing when he played golf with the president of GM. My mother's worst memory was in 1930, watching her dad lug his tool bag toward the bus station, off to find work somewhere.
Post-merger, cutting old machinery is simple. Picking which people to retain is not.
Too often, folks using the outmoded machinery also go.
That's shortsighted. Certainly companies need the productive folks running their best stuff. In every plant I've seen in dozens of countries, auto workers innovate.
In a Nissan plant, workers design and fabricate custom machines to speed headliner installation or lift fuel tanks into place as one worker bolts it home. Cool.
Designers must cut vehicle weight while protecting passengers, including small-overlap frontal crashes in which the crumple zone is mostly hollow. Ford pickup designers added rods in wheel wells to absorb energy and deflect impact.
Honda Fit designers tied the entire front end to the fenders. Now in a small-overlap crash, the oncoming vehicle crunches not just a fender and wheel assembly, but also must bend sideways the entire front bumper, front car frame and opposite-side fender to get to the driver. More brilliant solutions.
But sometimes the most resourceful workers have the worst equipment.
Last decade, Warsaw's FSO plant assembled three Soviet-era models on one shift, but triple-shifted its one modern transfer press. Almost hourly, machinists changed five die sets, but not the steel feeders. I met the foreman who had invented a universal feeder. It saved four minutes per change, hours per week of uptime.
So here's the cutback challenge. Scrap the junk.
But spot the people that kept that junk running. And give them better resources.