Paving the Way

Chrysler and Ford can learn a few things about modular manufacturing from a company that does it every day.

Workers at ASC’s Lansing, Mich., facility assemble a rolling chassis.

American Specialty Cars (ASC) may just be the closest thing to a contract manufacturer in North America. Workers at ASC’s 142,000-square foot Lansing, Mich., manufacturing facility build 42 sub-assemblies for the Chevrolet SSR including body structure, frame, engine and transmission, wheel and tire assembly, fascia assembly, condenser/radiator/fan module, complete IP including center stack, pedals and brake master cylinder, door trim, center console and the retractable hard top system. Sub-assemblies are built in sequence and shipped just-in-time to GM’s Lansing Craft Center, just four miles down the road, where GM workers assemble the parts into SSRs. ASC has total responsibility for a 172 member supply chain shipping parts from all over the world to ASC’s facility as well as direct to LCC. Jerry Mosingo, chief operating officer for ASC and an experienced automotive manufacturing guy who started his career as an hourly line worker for Ford motor company, sat down with AI to discuss the risks and rewards of manufacturing components for a major OEM. 
 
Q. The experts say that communication is the key. How important is it?

A. Communication is without a doubt the key element. It’s knowing not only what’s required hour to hour, because we don’t deliver a day’s worth of products, we deliver 10 or 12 shipments a day as needed to build the vehicles. The electronic communications with the ASNs, what’s going to happen, what do we need, color changes and so forth. That’s one piece of communication. The other piece is the engineering change control. Sending 42 sub-components to build that final vehicle, you can imagine the continuous engineering changes that are happening — the quality upgrades, the customer add-ons. So the engineering communication is absolutely key.

Q. What kind of positive improvements are the result of good communication?

A. What’s made us successful and where we’ve seen a lot of positive improvements in both LCC and our Lansing plant, is our ability to react without the long stream of normal channels of engineering. It comes straight from LCC to our facility. It’s as simple as getting the engineering change processed through the system to get a product trial report issued right back to LCC. You schedule the trial. You make the change. And if it doesn’t work you don’t have 1,000 cars sitting somewhere. You don’t have rows of material sitting there, that if the engineering change does work, then you have to say, “Okay, I need to balance out all these hoods or all these fenders.” You can do it almost instantly. 

Freshly-welded structural inner panels wait their turn to become Chevrolet SSRs.

Q. What kind of positive improvements are the result of good communication?
 
A. What’s made us successful and where we’ve seen a lot of positive improvements in both LCC and our Lansing plant, is our ability to react without the long stream of normal channels of engineering. It comes straight from LCC to our facility. It’s as simple as getting the engineering change processed through the system to get a product trial report issued right back to LCC. You schedule the trial. You make the change. And if it doesn’t work you don’t have 1,000 cars sitting somewhere. You don’t have rows of material sitting there, that if the engineering change does work, then you have to say, “Okay, I need to balance out all these hoods or all these fenders.” You can do it almost instantly.

Q. Ford says that the advantage to having the supply park right next door is that problems can be dealt with in a very timely fashion. Does LCC enjoy that advantage?
 
A. That happens to us in about the same time frame. We have people inside LCC and they have people inside our facility. If there is a defect in a product, I can have a replacement part their instantly.

Q. How do you deal with GMs quality expectations and how important is quality in the mix of things?

A. The advantage to where we are today is that there’s not a lingering debate over quality. When you’re in our situation, if there’s a quality issue or a quality improvement or a quality enhancement that you want to make, it’s instant. There’s no inventory. We don’t carry any inventory between LCC and us, very little. And when you have that kind of inventory control and there needs to be a change made on it because of a defect or an engineering change, you can make that on the fly. It absolutely will upgrade the quality because there isn’t this long lead of normal stops to get something fixed.

Anything that we can do in automotive to get inventory out between us and our customer, is the right way to do business. I believe that at some point in our relationship with our facility and LCC that we can have a true work-piece flow manufacturing facility. I believe we can make a car one piece through the system, constantly, with no flow. Jeff Weller, the plant manager at LCC, understands that process and I believe that that’s very much in the cards.

An ASC worker assembles a Chevrolet SSR retractable hard top module at ASC’s Lansing, Mich., assembly plant.

Q. One of the goals to Ford’s supply park is to reduce lineside inventory. Toyota is looking to reduce lineside inventory to zero. Is that feasible?

A. Absolutely, we should be at zero. I’ve had plants that I’ve managed that have done 200 inventory turns a month but it was still never good enough. Until it comes in one door and out the same door then I haven’t done it right yet. And I firmly believe we can get there. It will demand, demand that you know your processes — that you’re capable of stabilizing your processes — that you communicate well because the engineering change will happen on the fly now. You don’t have a float. So you better be damn good.

Q. Is GM holding you to a lesser quality standard than they would themselves?

A. The answer is that they’re holding us to a higher standard. And absolutely, rightfully so, given the kind of vehicle we have, and the willingness to let that quality slip or to not improve that quality instantly is a lot less than it would be on a normal vehicle.

Q. So it’s important for you to be quality driven because if you’re not at a level where they expect you to be then they’ll find someone else?

A. Yes they will.

Q. Will these supplier-run facilities need to be state-of-the-art?

A. They’re not only going to have to go state of the art. They’re going to have to build a flexible system, because you’re there, you’re that close. What happens if I have a change? I can’t shut that paint shop down for a week or two weeks. It can’t happen. You have to build something that’s as flexible as the need of your end item customer that’s right across the aisle.

Q. Experts have said that five years ago that Chrysler would never be able to do what they’re doing now because the unions wouldn’t let them do it. Your workers are UAW, do you see the union changing?

A. Our work force at our facility, they’re great. It’s a great work force. They’re UAW — the people inside our facility are certainly a part of that, but they’re also extremely aware and want to take part in the quality of the product and the improvements in the processes. They want to know the business. They’re becoming business people. They want to understand that a quarter panel costs so much to put on and making a bad one costs so much that they are really turning into very good business people at the same time. They’re very positive.

Q. So there’s a new paradigm then coming up through the younger ranks?

A. I certainly feel that in the Lansing assembly plant. It certainly appears that way.

Q. Do you develop your own supply chain?

A. We manage the suppliers into our facility and manage assembly to our sub suppliers. And we manage direct shipments of suppliers into LCC. So we have the total responsibility for the supply base on the SSR. We’re also using some new to GM suppliers.

Q. ASC is doing rolling chassis, body and interior. If you divided that between several suppliers would it create a problem?

A. What if somebody builds a quarter panel and moves the body locator that doesn’t match up to the frame build, LCC can’t fit the part. I enjoy what we’re doing because we have that control. We know where every body location pit is. We know it is the same place throughout our process. When you start spreading that to multiple suppliers, it could become an issue.

Q. What kind of warranty involvement do you have with GM and SSR?

A. We look at and monitor every warranty call on that vehicle. We have a warranty manager here that touches, looks at, reads, interprets every verbatim, every warranty. You have a claim that’s been made against that SSR we do that in conjunction with General Motors and we do that because we take responsibility for what we’re building. And for General Motors to truly see us as a partner, we need to take that responsibility. And also we want to implement changes immediately, and if we weren’t going to take an active part in that then we’d certainly not be the full service supplier that we are today.

Q. Are you taking full responsibility for warranty or is this something you’re sharing.

A. No we don’t take full responsibility for what has been negotiated through the contract with General Motors.

Q. So GM’s not taking all the credit and giving you all the blame?

A. General Motors truly is a partner with us in this. They’ve taken the step that not many OEMs have taken. There is no private knowledge between us and GM. We know everything we need to know. We know it together. We share it together. We talk about it openly with each other.

Q. With this Chrysler deal, you’ve got suppliers that are going to invest a lot of money to build dedicated facilities and a lot of their success is going to be tied in directly on the success of the vehicles that they’re building. How much of your success rides on the SSR?

A. Our success is the vehicle. And I think that’s a key driver for us and General Motors. GM has enacted a partnership with ASC like none other they’ve ever had. We are dedicated to deliver the product to them that continues to grow in the market place, add flair to the GM line, yet help GM and ASC together raise the level of quality one more time. Find another way to do it a little bit better. Give the end item customer one more reason to come back. Our success is parallel because we don’t want our customer to fail and don’t want ASC to fail.

Q. How would ASC fit into the Chrysler plan?

A. There isn’t any piece of that that we couldn’t do. But the advantage of what we do in Lansing assembly today is maybe a truer form to where we would like to go — one supplier giving you 42 sub components. The only missing link in what you just described versus what we have today is a paint system. That’s all. We do everything else. We do the IP cockpit build up. We stuff the engine and we supply the wheels, all the rest of that. We virtually can do just about anything that the perception of Toledo is with multiple suppliers trying to do exactly the same thing.

Q. There’s no problem with volume. Is volume just becomes an object of scale?

A. To me volume is an object of scale. Now this is a low volume manufacturing company. We’re not about high volume vehicles here. My background is high volumes. That’s all I’ve ever done until I got here.

Q. The industry is getting to the point where they’re saying that 60,000 copies of anything is high volume. Could you do 60,000?

A. We like to take a look at 15,000 for us for what we do. That’s a sweet spot at 15,000. I think that we can get to 25,000 if you took what we’re doing at Lansing assembly today and just put on another shift.

Q. This modular concept builds great flexibility. If GM decided to do an SSR wagon, how would you do that?

A. We could do that overnight. But there again, that is strictly ASC because we do art to park. Do all the suppliers have the ability to do that? Can they pull off the fascia, slap another one on there and start carving it where you put new attachment bolts, make it look different? And when they put it into clay can they take it to CAD? Can they put it in a tool? We have that capability.