As editor of The 2007 version of the Harbour Report, which compares productivity of North American auto assembly plants, was released yesterday. The $595 report by Troy, Mich.-based Harbour Consulting Inc. is required reading in the auto industry -- but even the free 38-page news release which announced the release of results has plenty of meaty tidbits. For example:
- Toyota and Honda have a pre-tax profit margin of $1,200 per vehicle sold in North America, Chrysler lost $1,072 per vehicle sold last year, GM lost $1,436, and Ford lost $5,234. "This reflects a variety of factors, including the large difference in health care and pension costs, lower average revenue, as well as higher costs of rebates and low-interest rate financing required to trim inventories."
- Also: The United Auto Workers and Canadian Auto Workers unions "were more proactive in 2006 than ever before in creating a more competitive environment among the companies whose hourly workers they represent. Chrysler, General Motors and, especially Ford, negotiated more flexible local labor agreements prior to this summer's pivotal national talks with the UAW. However, they must go further to overcome their persistent health care and pension cost disadvantage vs. Honda, Nissan and Toyota. Restrictive labor agreements that create cost disadvantages still exist and could jeopardize the survival of certain automakers."
- Toyota leads the six largest competitors in total manufacturing productivity (assembly, stamping, engine and transmission), using 29.93 labor hours per vehicle.
- General Motors wins 3 of 4 Best Plant awards.
- Fewer plants are producing more vehicles and a wider variety of models supported by flexibility and productivity gains throughout the industry.
"Improving productivity in the face of lower production is a huge accomplishment, but none of the domestic manufacturers can afford to let up," said Ron Harbour, president of Harbour Consulting. "General Motors essentially caught Toyota in vehicle assembly productivity. Considering that they will be building vehicles in 2007 with dramatically fewer hourly employees in the U.S., GM, Ford and Chrysler likely will reduce their hours per vehicle significantly."