Virtually everyone agrees on the problems, or shall I say "challenges," for the domestic auto industry these days — high-cost, under-performing organizations — but identifying the problem any more clearly is difficult. Is it the workers? The products? The management? The operations? In their pursuit of solutions, Ford Motor Co. and General Motors Corp. are moving in opposite directions, in one significant way, at least.
Ford Motor Co. ended metalcasting at its Windsor, ON, plant recently, after more than seven decades of producing cast-iron cylinder heads, master cylinders, cylinder blocks, and crankshafts. As recently as last year Windsor cast more than 100,000 tons of metal, and produced about 500,000 engine blocks.
Attention in such situations always turns to the fate of the workers, and Ford of Canada's site manager made clear the Windsor employees were not responsible for this ending.
"It is a tribute to the employees at the Windsor Casting Plant that they have achieved outstanding productivity levels with consistently high quality throughout this year, right down to the last engine block produced," Adrian Vido said.
The problem, Ford is making clear, is not with the Windsor plant, nor with the Cleveland Casting Plant in Ohio nor the Leamington Foundry in England, where shutdowns are scheduled also. The problem for Ford is these plants' purpose: "The company's decision to move away from in-house casting operations is based on a thorough analysis of our business and a need to focus on our core operations. While difficult, these are the right actions for Ford's future," stated Vido.
That might be enough of an explanation if it weren't for the odd, unanswered questions. For example, does Ford plan to outsource all its casting needs? Might that lead to cost or quality concerns? Ford hasn't said. And what are observers to make of Navistar International's claims that Ford is trying to break their diesel-engine supply pact because it (Ford) plans to introduce its own diesel engine. Surely, there are castings involved in any such plan.
Most puzzling about Ford's decision is the contradictory signal given by General Motors with its recent announcements: GM is planning new capital investments totaling nearly $170 million for metalcasting technology at its GM Powertrain plants in Saginaw, MI, Defiance, OH, and Bedford, IN (where, by the way, a $44-million expansion of melting operations is already in progress.)
In each case, GM's manufacturing manager for castings Arvin Jones made the appropriate nod to workers (e.g., "This investment would not be possible without the involvement of employees at this facility, who have dedicated themselves to improving the quality of our products and the efficiency of the operations here …"), but it's plain that this automaker sees a fundamental link between its powertrain designs, its metalcasting operations, and the future success of the organization.
And, GM is not alone. Chrysler Corp. has a new powertrain strategy underway. Honda and Toyota (also domestic automakers, I should note) have never hinted a severing the link between metalcasting and the rest of their design and manufacturing operations. In this light, Ford's decision to separate "in-house casting" from "core operations," as it has done in various recent statements, is a highly curious "way forward."
To be clear, Ford may have very sound reasons for this separation. It may be making decisions about the cost of operating these plants, or the metals they cast, or the markets they serve. But, these are just my guesses, because Ford will not be clear. And when so many other organizations are making the opposite decision, it's worth asking whether they are being foolish, as well.