State’s Two Car Plants--Study in Sharp Contrasts : Automobiles: At the NUMMI operation in Fremont, Japanese-style management is having positive results. The same cannot be said of GM’s Van Nuys facility.
It was only one of the 3,000 or so parts that go into a new Chevrolet Camaro or Pontiac Firebird. But for Larry Barker, a welder at the General Motors assembly plant in Van Nuys, one part summed up all that is wrong with the way GM builds cars.
One night last fall Barker, along with the rest of the second shift, was sent home early after GM ran out of a reinforcement panel that is welded next to the wheel wells near the motor compartment of the Camaros and Firebirds. The panels come in pairs--one for the right side, one for the left--and when the plant ran out of panels for one side, the assembly line stopped.
“A night shift supervisor came down,” Barker recalled, and for the next 20 minutes, “he actually took one of the panels from the other (wrong) side and . . . literally tried beating it into place with a hammer and then welding it.”
This Rube Goldberg fix-it took so long, Barker said, that GM decided “it wasn’t worth it, so then they sent us home.” But if the wrong part could have been forced into place faster, he believes, “they probably would have run” the assembly line.
Things are not supposed to work that way at the GM Van Nuys plant. Almost three years ago, GM overhauled the assembly system there and put in a Japanese technique called team concept. The idea was to give workers more say in how cars were built: They would work in small teams rather than as individuals and, if a job wasn’t done right, workers had the power to stop the assembly line and fix the problem before the car moved to the next stop. It was all part of GM’s plan to make better cars.
But the team concept instructors didn’t say anything about trying to force a wrong part into a car. “There’s a difference between having a part a little wrong and beating one into place with a hammer,” Barker said. “They want quality, and they want you to be proud of what you’re building. But how can you, when you see stuff like that?”
Meanwhile, in Fremont, Calif., about 400 miles to the north, a worker at the New United Motor Manufacturing Inc. plant (NUMMI) tells another story about car parts. NUMMI is jointly owned by Toyota and GM and is the only other automobile assembly plant left in California.
Paul Allen, a NUMMI group leader, said one of his teammates noticed that the brackets holding up instrument panels in the NUMMI-made Toyota Corollas and Geo Prizm cars are virtually identical. The only major difference is that the brackets imported from Japan for the Toyotas are half the price of the American-made brackets that go into GM’s Geo cars.
So Allen’s team proposed using only the imported parts. Multiply 15 cents saved per bracket by 190,000 cars a year, and it saves about $30,000. “It’s the little things” Allen says, that add up to better quality and lower costs.
This is a tale of two car plants. Each uses the same Japanese assembly method. Each has a veteran United Auto Workers work force. There the similarity ends.
The NUMMI plant is happy and growing, with Toyota investing $200 million to add a line of pickup trucks, and later this year the plant will start hiring 550 more assembly workers. At Van Nuys, 400 employees were laid off last summer because of slow sales, and the 3,550 assembly workers set to return to work Feb. 5--after a six-week closing to retool for 1991 model year changes--have every reason to worry about the place eventually shutting for good.
Maybe that explains why 17% of the workers at Van Nuys don’t show up for work on a typical day. At NUMMI, absenteeism runs just 6%. And consider the difference in car quality: NUMMI’s cars have “the highest level of quality of any GM plant,” said Chris Cedergren, an analyst with J. D. Power & Associates, an Agoura Hills automotive industry research firm. At Van Nuys, he said, there has been only “marginal” improvement since team concept was introduced.
From the start, the NUMMI plant was an experiment in labor-management relations. Back in 1982, it was a GM plant producing Oldsmobile Cutlasses and Chevrolet Celebrity models. But then, as now, GM was coping with slow sales, and in March of that year the company closed the place. Two years later, GM, Toyota and the UAW struck a deal to reopen it.
The union slashed the number of job classifications to three from more than 100 in return for giving laid-off workers the first claim on the new jobs. Toyota would run the place, with GM and Toyota splitting the costs. Toyota would get a chance to see if it could work with American labor, and GM would get a close look at how the Japanese make their formidable small cars. Both companies would get some cars to sell.
Things worked so well that GM wanted to use NUMMI as a blueprint for operations in many of its own plants, including Van Nuys. So why has it worked in one factory and not the other?
It’s more complicated than just saying that NUMMI could better follow the Toyota production system because it had Japanese managers, although many Van Nuys workers gripe that GM has not carried through on its team concept promises. It probably didn’t help that the UAW local in Van Nuys was divided about team concept. And then there is the element of job security: NUMMI has a no-layoff policy; Van Nuys doesn’t.
Perhaps if GM were enjoying Toyota’s sales growth, things would be different. But the workers know which side their bread is buttered on. Listen to Bob Contreras, who works in NUMMI’s metal stamping department.
“We were kind of skeptical” about the no-layoff plan, he remembers. NUMMI has a no-layoff clause in its labor contract, but that is a goal, not a guarantee. The policy was tested in 1988 when sales of GM’s Chevrolet Novas, which were made at NUMMI, sank by 41%. But Toyota stepped in, boosted the production of its own models, used the slack time to retrain workers--and no one was laid off. “They made believers out of us,” Contreras said.
Contreras, who put in 20 years for GM at the plant in Fremont before his five years at NUMMI, hopes that the rumors about the Japanese buying out GM’s share of the operation come true. He prefers life under Toyota.
There’s more openness, he said. He doesn’t have to shout on the factory floor to get his point across and, for the first time, he’s driving a car made at Fremont. “If somebody listens to your ideas, it makes you feel like you contribute to the car. Every time you see a car (you built) going by on the freeway you get a good feeling,” he said.
Van Nuys Morale
In recent months at the Van Nuys plant, when Chris Mathis has taken up his post at 4 p.m. ready to build axle stabilizer bars for the second shift, on some days only three of his seven teammates showed up, he said. “People get angry, and a lot are sicking out,” he added.
Morale is bad, he said, because workers do not have enough say in their jobs; they are discouraged from stopping the assembly line to fix defects, and Mathis said his team--like many others--has not been retrained so they do not know how to do each other’s jobs.
“No one has been cross-trained,” he said. “Management is too busy keeping the line moving.”
Mathis, 27, is trying to get ready for another career by forcing himself out of bed in the mornings to attend a community college. “I started Feb. 9, 1982,” at GM, he said, adding that “we all know our start dates” because layoffs are determined by seniority. “The rhetoric of team concept is (that) the work force can’t work well under fear and intimidation, and that’s what we have.”
Stephen Yokich, head of the UAW’s GM department, heard that sort of complaint when he toured the Van Nuys plant last fall. “I don’t think they have true team concept,” he said. "(GM) looks at the Japanese system and says, why can’t you become like the Japanese? There’s no layoffs in the Japanese system. . . . (GM) can’t have just what they want to pick out of the system. . . . They have to sit down and make commitments and live up to them.” One point of uneasiness for workers is GM’s commitment to Van Nuys. A man or woman working on the line, earning UAW scale of $16 an hour, can make $30,000 a year, and the benefits are first rate. But GM said in November that the next generation of Camaros and Firebirds will be made by another GM plant, probably in Canada.
That decision owed something to geography: About 75% of the Camaros and Firebirds are sold east of Denver. Van Nuys will keep making the current models until the new cars are ready, though GM will not say how long that will be. The only hope for Van Nuys is if GM spends the money--some say $40 million, others $250 million--needed to turn the factory into a flexible plant that could make different cars for the West Coast market.
Don’t bet on it, J. D. Power’s Cedergren warns. GM’s market share keeps dwindling, down to 35% last year from 46% in 1980, and no matter what rebates it offers, GM still has more production capacity than it can use. GM must close several more plants, the analyst said, and when the company makes its choice, there is always the geography factor.
Californians are less fond of GM cars than the rest of the country; GM’s market share here is two-thirds of what it is nationally. And no matter which car is made in Van Nuys, GM has to ship parts here from the Midwest, boosting production costs by $250 a car, a UAW official said. “A flex plant . . . is just not practical,” Cedergren said. “Van Nuys has three years to live.”
At NUMMI, the plant has the air of a place come back to life. The factory sits at the lower end of the East Bay, 30 miles south of Oakland, an area that has filled in with shopping malls, truck depots, motels and homes since GM opened the place in 1962. People who live nearby call the plant “the battleship,” and it looks like one: almost half a mile long, painted institutional gray and khaki, with dozens of smokestacks.
At the south end of the building, 7-foot-tall coils of sheet metal sit waiting to be stamped into hoods and doors, while at the north end newly minted subcompacts are driven into the sunlight, ready to be shipped to dealers. In between, the plant consists of a few vast, open rooms, with sparks flying and a din of machinery.
To help link the 2,400 workers into a team, NUMMI has a series of electric scoreboards above the plant floor. The boards, with red, yellow and green lights, show how well the assembly line is moving. If the line shuts down, a number flashes showing which work station stopped the assembly line.
When there is a problem, a worker yanks a cord, some music comes on and the board lights up. Unless the worker pulls the cord a second time within a minute or so, the whole line stops. The music is in electronic, elevator-Muzak tones and each team selects its own tune. (In December, Christmas carols were popular). One NUMMI worker said: “If you close your eyes, and if you’re well tuned in, you’ll know how well the whole floor is doing.”
On a recent day, there were snatches of music, but no symphony; the line was running easily. One trouble spot, though, was near the end of the assembly line. This particular team’s work area was 20 feet long, with yellow lines marked “start” and “finish” next to the conveyor belt that moved the cars along. The workers were supposed to complete each job before the car crossed the “finish” line.
But one assembler, a woman in her 30s, kept shooting past the finish line. She was installing seat belts in the front and rear of the car as well as snapping a strip of plastic molding inside the rear door. It’s a demanding job, with a lot of bending, twisting and bobbing-for-apples motion. She’d pick up the parts, toss them in the car, lean inside and, with an air-powered wrench and a screwdriver, install them while walking beside the moving car. When she finished, she’d reach into a parts tray and start on the next car.
The problem was that sometimes she came to a stop 10 feet past the finish line, so she had to run back to catch the next car, unlike the steady, unbroken pace most workers kept up. She pulled the cord and her team leader, a combination supervisor and worker, came over and helped out. She caught up, then fell behind, but the delay wasn’t so critical that the line stopped.
Fast Work Pace
This kind of tightly choreographed work at NUMMI means that there is very little wasted motion or goofing off. And it is one reason that a dissident group of workers, called the People’s Caucus, has taken hold, although, judging by UAW local elections, the group is still in the minority.
Among their gripes is that too many injuries occur because the work pace is so demanding. Carter Oden, who pegs himself in the middle between NUMMI loyalists and dissidents, is a 14-year GM veteran with five years at NUMMI. He concedes: “You work more seconds out of every minute than at GM. They do believe in getting their dollar’s worth out of you. But they don’t work you to death.”
All this sweat helps NUMMI produce a car in about 25 worker-hours, compared to about 32 hours in Van Nuys. Part of this has to do with automation: NUMMI has 220 robots, Van Nuys only 24.
Another plus for NUMMI is that long after the honeymoon period, many of the plant’s workers still talk about the misery of being unemployed and how that memory keeps them motivated. After GM shut down the Fremont plant in 1982, the suffering began. There were a few suicides. Bob Fernandez, financial secretary for UAW Local 2244, remembers when “I counted eight families, some with kids, living in our parking lot in camper shells. They’d exhausted their (layoff) pay. We made pots of spaghetti and stew and ran a rubber shower hose into the bathroom.”
So when the plant reopened, the UAW and the old GM workers hired on by NUMMI were willing to try something new. About 75% of NUMMI’s present workers used to work at the same plant for GM, and while nobody shows up early anymore to do calisthenics--a staple of Japanese assembly plants--the Toyota system has clearly taken root in Fremont.
All of NUMMI’s precise choreography, of course, is designed to maintain a delicate mix of speed and quality that pays off in well-made cars. One gauge of this is the “first run ratio,” or percentage of cars inspected at the end of the line that don’t need any repairs.
The inspections are fairly elaborate: Cars are driven onto platforms while the engine is revved, speedometers, lights, exhausts and brakes are checked; then the cars are run through a shower to be checked for leaks. If an inspector finds a problem, the car is sent to the repair “hospital.”
On a recent day at a NUMMI inspection station, a board posted that day’s persistent defects--a faulty defroster button, a gap in the glove box, loose side-view mirrors. But the chart also showed that over 13 months, 85% of NUMMI’s cars passed final inspection without needing any repairs.
Van Nuys Problems
At Van Nuys, that sort of performance is only a dream. A private GM audit leaked to The Times showed that during one month last fall, only about 35% of the Camaros and Firebirds inspected at the end of the assembly line did not need repairs.
In some ways, Van Nuys resembles the NUMMI system. There are the electric boards above the factory floor, and music chimes when there’s a problem. There are also weekly team meetings where workers are supposed to make suggestions to managers.
But the team meetings do not always follow the blueprint. “At one of the team meetings, the foreman got up and listed for us . . . ways we could be fired,” said second-shift worker Mathis. “It isn’t anything like how it was in (training) class. They talked of ‘active listeners,’ ” Mathis laughed, “He talks. We listen.”
The Van Nuys plant, built in 1947 between homes to the north and an urban strip to the west, needs all of the efficiency that motivated workers can provide. When team concept started almost three years ago, workers got at least seven days of classroom training, with the instructors, some from UCLA, offering a primer on group psychology and communication skills.
At first, there was excitement about trying something new, but that enthusiasm was slowly blotted out. A few months after team concept began, GM’s plant manager at Van Nuys--one of three in the past three years--sent out a letter chastising workers for stopping the assembly line so often.
“There’s been some slight improvements in quality” since team concept went into effect, said Mark Masaoka, a Van Nuys electrician who has worked at the plant since 1981. “But not (involving) the fundamental quality problems the car has a reputation for. . . . There is a view that team concept is going to magically solve these problems instead of taking a nuts-and-bolts approach and saying: ‘This component is wrong, let’s redesign it.’ ”
One of the recurring problems in the Firebird and Camaro, according to Consumer Reports surveys, is the brake system. Mathis, who also installs brake lines at the Van Nuys plant, says: “It’s been one chronic problem even before team concept.” The brake line tubes are delicate, made partly of aluminum, and when Mathis uses an air-powered wrench to tighten the bolts, the wrench often spins backwards and dings the metal.
When Mathis looks, he can’t tell for sure whether the metal has been damaged. The mystery is solved at the next stop in the assembly line when brake fluid is added. If it leaks, there is obviously a problem, the brake line has to be drained and a new one installed. The problem is so chronic, Mathis said, that workers stand on a metal grate running a few inches above the floor, where a reservoir catches the spilled brake fluid.
Of course, if there are defects in the cars, GM can always catch the repairs at the end of the line. But one veteran worker at Van Nuys, who asked that his name not be used, said the repair crew is overworked and there is pressure from GM to ship the cars.
He tells of driving a Van Nuys-made car last fall after it cleared inspection: “It was a warm day, and I tried the air-conditioning. It didn’t work. I turned off the radio and heard this noise. There was a hell of a rattle on the underbody. I felt terribly embarrassed.”
In recent months GM has pulled down the shutters at Van Nuys. The plant manager isn’t doing interviews; tours have been suspended.
Richard Ruppert, the UAW local shop chairman in Van Nuys, said: “Perhaps we raised expectation levels pretty high for the folks on the floor that the world was going to change overnight. And the world doesn’t change that fast.” But he remains a team concept advocate and is upbeat about the odds of GM converting Van Nuys into a flex plant to keep the place open. “We’re in the right place. We’re in a large car market,” he says.
But a group of Van Nuys workers say their only chance to save their jobs is by revving up a community coalition to threaten GM with a car boycott. Masaoka, the electrician, says: “If GM feels they are going to have a major political headache . . . then I think they could keep the plant open and absorb the higher shipping costs.”
Larry Barker, the night shift welder, isn’t thinking about boycotts. He’s begun planning his life after GM. He and a buddy have already talked about moving to Utah in hopes of hiring on at a truck factory there.
For all of Barker’s recent disappointments, he remembers how his life changed n 1977 when GM hired him. At the time, his wife was pregnant and he’d been working as a truck driver for $5.25 an hour, with no insurance benefits.
If GM does shut Van Nuys, with his 13 years seniority Barker guesses that his UAW benefits will last about eight months. He and his wife can always sell their home in Simi Valley and use it as a grubstake. If things don’t work out in Utah, maybe he’ll move back to Ohio. At 40, he figures that he’s not so old that he can’t start over.