NISSAN BUCKS CARMAKERS' TREND TOWARD OUTSOURCING MORE PARTS FIRM'S OWN PLANT IS MOST EFFICIENT

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Nissan will make more parts in-house this year as it introduces two restyled U.S. vehicles.

The new Altima and the redesigned pickup, both built in Smyrna, Tenn., will require Nissan Motor Manufacturing Corp. U.S.A. to produce more metal and plastic parts.

That is the opposite of what some automakers are trying to do. But it illustrates a truth about automaking: Some plants are more efficient than others.

From General Motors to Volkswagen, automakers are looking for ways to get out of the parts-making business. They feel suppliers can produce parts and assemble them into systems more cheaply and with more expertise.

But Nissan is looking at the other side of the coin, said Emil Hassan, senior vice president of operations. It wants to make the best use of a trained, efficient work force and tooling that is already paid for.

``We're constantly looking at opportunities to do value-added work more efficiently than an outside supplier,'' Hassan said. ``We haven't laid down any rules that say we won't do this part or that kind of work. Everything is up for grabs.''

For the past three years, the Smyrna plant has been ranked the most productive auto plant in North America by Harbour and Associates Inc., a manufacturing consulting firm in Troy, Mich.

General Motors Corp. and Chrysler Corp. have endured labor strikes in recent months that challenged their outsourcing plans. The Smyrna work force is not represented by the United Auto Workers.

This summer, when Nissan introduces its new Altima, an in-house plastics injection operation will supply the car's bumper fascias and grille. It also will continue to produce bumper fascias as replacement parts for the previous Altima. And it will continue to produce the Altima's fuel tank.

Nissan had planned to farm out the stamped-metal replacement parts for previous Altimas. But a Nissan study determined that Smyrna could supply the parts more efficiently than an outside supplier.

``We looked at what it would cost to outsource them and decided we already had the capability,'' Hassan said in an interview with Automotive News, a sister publication to Plastics News.

The Smyrna plastics department will add still more parts when Nissan's new pickup, the Frontier, is introduced in late September. The operation will begin making sets of four new fender flares for the Frontier. It will produce a cowl top, a new design feature, and a new compression molded bumper extension that shields the steel bumper.

``We have no plans of getting to the point where we do major components,'' Hassan said. ``But with each new program we do here, we look at each change on the vehicle and ask ourselves whether it would be beneficial to bring it in-house. We do a separate study on each one.''

A cost study in the late 1980s found that Nissan had advantages over its plastics suppliers in producing Nissan bumpers. The suppliers then had high scrap rates and high transportation costs, which Nissan eliminated by putting the work under its own roof.

Quality considerations also play a role. When it began making bumper fascias in 1990, Nissan could color-match the plastic with the paint better on the Sentra. Hassan said that for Nissan, the name of the game is making the most efficient use of capacity and investment.

``We're putting what we have to greater use. In plastics, the machines will be working more, going practically 24 hours a day.

``That kind of equipment represents a pretty heavy investment,'' he added. ``You don't want to see it sitting idle for one minute.''