Transcript John Felice - Front Page -

John Felice
Vice President
Manufacturing, Technology & Global Enterprise
Chrysler Corporation LLC
CHRYSLER GROUP
Chrysler Group’s Flexible Manufacturing Strategy
May 17, 2007
John Felice
Vice President – Manufacturing, Technology
Global Enterprise
Chrysler Group
&
CHRYSLER GROUP
Market and Competitive Challenges
Supply
Chain
Tough
Competition
Government
Regulation
Consumer
Demand
CHRYSLER GROUP
RTP Focuses on Short- and Long-Term Goals
Recovery
•
•
•
•
•
Short-term progress on
profitability
Aligning capacity, cost structure and capital spending
with market demand
Increase efficiency of all aspects of the business
Return on sales of 2.5%
by 2009
•
Strengthen and increase revenues and margins
Strategic
Transformation
•
Global market opportunities with low cost sourcing
•
Strong product pipeline
Mid-term change of
business model
•
Achieve and sustain
benchmark performance
$3 billion powertrain investment leads to a more fuel
efficient product lineup
•
Dealer network optimization
Seven Work Modules Focused
on Short- and Long-Term Improvements
CHRYSLER GROUP
Chrysler Group Executive Committee
WM1
Program Office
WM2
Fixed Cost Management
WM3
Structural Changes /
Manufacturing
WM4
Material Costs
Management
WM5
Revenue Management
WM6
WM7
WM – Work Module
Product Strategy /
Portfolio Management
Quality
Capital Management
These work modules
are sub-divided into
teams that are working
on tackling costs,
improving quality and
efficiency and
enhancing revenue
across the entire scope
of the company
Redesigned Business Model
Supports Long-Term Growth
Current
Redesigned Business Model
NAFTA-centric
NAFTA + Global balance
CHRYSLER GROUP
• Manufacturing, supply and sales footprints
optimized (balanced) to maximize global
growth and profitability
Internal
resource
driven
Productcentric
Internal + Alliances and partnerships
• Leveraging partnerships to manage costs
• Creative and efficient use of alliances to
quickly respond to geographic, market
segment, and product opportunities
Product + Customer and brand focus
• Customer driven products and processes
• Clearly defined uniquely American brands
• High brand equity and customer loyalty
CHRYSLER GROUP
How Does DaimlerChrysler Respond Effectively and Efficiently
to Market Conditions and Volume Fluctuations ?
CHRYSLER GROUP
Flex Target State
FLEX OPPORTUNITIES
 Product Development
 Flex Manufacturing
KEY QUESTIONS
How do you develop an optimum number of
quality products efficiently?
How do you best use the existing asset base to
build products in response to market demand
 Global Sourcing
swings quickly?
How do you globally leverage the best cost-
saving sourcing opportunities through volume
 Product Portfolio
bundling and commonization?
How do you offer consumer-driven product
lines that can achieve geographic and market
 Global Alliances &
Partnerships
segment opportunities?
How do you achieve better global balance and
leverage partnerships to manage cost and
seize growth opportunities?
Name of the Game:
CHRYSLER GROUP
Increase Products, Decrease Capital Spending
32
52%
$41.9
24
$30.7
$30.1
2002
Plan
2005
Plan
21
2000-2004
Plan
2002-2006
Plan
“Do More”
2005-2009
Plan
2000
Plan
“Use Less”
CHRYSLER GROUP
How Does DaimlerChrysler Respond Effectively and Efficiently
to Market Conditions and Volume Fluctuations ?
CHRYSLER GROUP
CHRYSLER GROUP
Product Development
Optimize Vehicle Platforms:
Reduce Number of Platforms from 12 to 7 by 2012
2006
2012
5
FWD UNIBODY
3
3
RWD UNIBODY
2
4
BODY-ON-FRAME
2
12
7
CHRYSLER GROUP
Product Development
Reduce Design Complexity
 Reduce Build Combinations
 Build-in Quality and Manufacturability
 Reduce Number of Parts
 Reduce Parts Proliferation and the Number of Designs
for Each Commodity
 Increase Common Parts Sharing
Dodge Nitro:
From 167,424
possible
configurations
to 650
CHRYSLER GROUP
How Does DaimlerChrysler Respond Effectively and Efficiently
to Market Conditions and Volume Fluctuations ?
CHRYSLER GROUP
Flexible Manufacturing
Basis: Create a Flexible Manufacturing System to Support a Broad Product
Portfolio and Pull-based Marketing Model
Unibody
Arch #1
Unibody
Arch #2
Other
Arch
Body-on-frame
Arch
Model
Model
Model
Model
Model
Model
• Converge product
portfolio into 4
potentially basic
architectural families
Model
Model
Model
Model
Model
Model
Model
Model
Model
Model
Model
Model
Model
Model
Model
Model
Model
Model
Model
• Create flexible
manufacturing base
aligned to architecture
Model
Model
Plant
A
Model
Plant
B
Plant
D
Plant
C
Plant
E
Plant
F
Plant
H
Plant
G
Plant
I
Plant
J
Plant
K
Plant
M
Plant
L
Plant
N
Create Flexible
Product and
Manufacturing
Footprints on a
Global Basis
Flexible Manufacturing:
CHRYSLER GROUP
Common Bill of Process
Enabler 1: Standardize on a Competitive Common Bill of Process to Drive
Manufacturing Flexibility, Efficiency, Quality and Product Design
 Provide a Common Mainline Manufacturing System:
- Operational Sequence
- Operation Content & Dimensional Strategy
- Assembly Process that Optimizes Unibody/BoF Portfolio
- Common Process Framework for Subassemblies
- Machine, Equipment, Tooling, Controls & Facilities Guidelines
- Scope Covers Dies, Stamping, Body Structures and Closures,
Paint, Trim, Chassis, Final, Powertrain, etc.
- Catalog of Technology
Flexible Manufacturing:
CHRYSLER GROUP
Flex Body Shop
Enabler 2: Build a Flex Body Shop Process to Allow for Platform Derivatives and
Reduce New Model Changeover by Leveraging Key Advances in Robotics
Payload Capability
Key Developments
(Kilograms)
in Robotics:
500
300
400
700
600 Payload
- More
range
Flexibility
 Standardize Common
Core Processes to
- More powerful
Controllers
1990’s
 Multiple Model
- Reduced Cost
2006
Build 3 Platforms/
4 Models
 Build Old/New
Models Concurrently
 Produce Models from
133%
0–100% of Capacity
Payload
Capability
Cost
 Flexible Load and
Weld Processes Using:
- Robotic Hand-off
30%
- Geo End-effectors
Flexible Manufacturing:
CHRYSLER GROUP
Plant Charter
Enabler 3: Plant Charter – Blueprinting Each Plant’s Build Capability to
Accommodate Flexible Product Requirements
Plant: Belvidere - FWD UNIBODY
Additional Detail
Wheel Base
Max Track Width
Envelope Size is Based on Product Dimensions
105"
PRODUCT MAX DIMENSIONS: L/W/H
Envelope Size is Based on Plant Dimensions
58"
Wheel Base
Max Track Width
Based on Aligners or Rolls Test Capability
min. - max.
Flat Top Conveyor limit
Inside Min. Tire Track/ Outside Max. Tire Track
90 - 130"
45 - 69"
SHIFT PATTERN
Smart Migration Timeline
2006
2005
2008
2007
2009
2010
2011
2012
2013
2014
2015
Target
Actual
Mix Flexibility*
Asset Util.
100 / 100 / 100
PM/MK49/MK74
Performance Targets(T)/Actuals(A)
October 2005
100%
* Doesn't include Manpower Balancing, Supplier Tooling, or Racks
Group Adapt ($)
Not Ideal ($$)
Overhaul ($$$$$)
B.I.W. BOP/Flex - POR
PLANT’S CAPABILITY
Body Washer
Pretreat
Underbody Pallet-Geo 1
Front Floor
Underbody Pallet-Geo 2
Doors Off
Phosphate
Includes 1 extra stage
Includes 2 extra stages Cockpit Install
Roof System
27.4 minutes (vs. 30)
E-Coat Sand
end of arm tooling costs
Robotic Sealer
Shelf Module
Glass Install
Chassis Insertion
Framer - Lower Geo - a
Manual Sealer
Front Fascia Install
Framer - Upper Geo - b
Accumulator
Rear Fascia Install
Roof Framer
Feather Duster / Blow-off
Tooling Costs
Funded
Primer
Lift Gate
C/O Transfer
Hinge to Body
C/O Transfer
Rear Door - A
C/O Transfer
Front Door - B
C/O Transfer
Fender - C
C/O Transfer
Hood - E
C/O Transfer
Deck Lid - D
Metal Finish
Power Strg Evac and Fill
Rad Coolant Evac and Fill
Washer Fluid Fill
Fuel Fill
Selection Bank / Color Wheel
Feather Duster / Blow-off
Intercoat Flash - Off
4.42 minutes (vs. 6.5)
Seat Install
26.1 minutes (vs. 30)
Top Coat Oven
Gripper restrictions
Lift gates/ Deck Lids
Electrical Test
Rolls Test
Reprocess / Rerun
Gripper restrictions
Canbus
Wheel Alignment
Headlight Aim
Accumulator
Gripper restrictions
Outsource
Doors On
Strip / Accumulator
Finesse and Polishing
Hoods
2 Rows
Tire and Wheel Install
Inspection
Doors
MIX FLEXIBILITY, ASSET
UTILIZATION
Post Decking
Pedal Push
Clear Coat
Process not included
Diesel: Y
Brake Evac and Fill
Base Coat
C/O Transfer
Pre-Gel Oven
AC Evac and Fill
30 minutes (vs. 33)
Strip / Accumulator
Primer Sand / Prep
Not funded
No FEM
Trans Fill
Powder
Primer Oven
Manual Weld Back-up
Sunroof: Y
Carpet
Strip / Accumulator
end of arm tooling costs
Body Side Marriage
PRODUCT LINE UP CAPABILITY &
“PROTECT FOR”
Size: 4 Dr
Wire Harness
E-Coat
Body Side Inner
?
Comment
In Body Shop
E-Coat Oven
Body Side Outer
PLANT CAPACITY, PLANNED VOLUME
?
Comment
Rear Floor
MK74
?
?
T=17.04/A=17.70
TCF BOP/Flex - POR
Paint BOP/Flex - POR
end of arm tooling costs
Net Form and Pierce
MK49
T=3.99/A=4.56
HPV
Comment
Engine Compartment
PM49
EHPV
Not Dedicated System
Trans Top Off
Spot Repair
Water Test
Parts Change
Quality Check
BILL OF PROCESS CONFORMANCE,
ASCENDING ORDER
Accumulator
Robotic PUR Foam
Low Bake Repair
% Compliance to
% Compliance to
Ascending Order
88%
% Compliance to
Ascending Order
Ascending Order
100%
81%
General Information
IMPLEMENTATION TIMING & COST
BIW
Paint
Current
White Space - Sq. Ft.
Type of Framer
Proposed
TCF
Current
Proposed
10
9
# of colors capable
0
0
Gate
Robotic
Low/Upp
# of booths - main color
2
2
78
78
TBD
2010
2
2
Line Speed (Gross PurFoam)
Timing of new paint shop
Jr. System
Technology
BIW
Number of Stations
Paint
Implementation Date C.Y.
Current
Proposed
352
222
TCF
Implementation Date C.Y.
Implementation Date C.Y.
Robotic Piercing
2006
Rob Scan
TBD Bell/Bell App Tech
2006 4WD Rolls
2006
ABB Robots
2006 Robotic cut-ins
2006
4WD Alignment
2006
Servo Welding
2006 Robotic Sealer
2000
Servo Headlamp Aim
2004
Mid Frequencey Welding
2006
2006 Combined Fills
2006
Adaptive Weld Controls
TBD
2006 Auto Return Fuel Fill
2006
Modular Weld Guns
2006
2006 Andon
2006
No sand/E-coat
Liquid Applied Sound Deadener
Robotic PUR Foam
Flexible Bell Automation
Canbus Electrical Test
Flexible Measurement
TBD Feather Duster
2006 Front End Module
TBD
Note: Paint still requires cording study for interferencePowertrain Module
TBD & process capability study
Auto Decking Man. Fast.
In Production
Planned
2006
Weld Quality Network
TBD
FlexIble PLP
Net Form and Clinch
Enterprise Controls / CLICK
Funded
2006
TBD
2006
2006
PLANNED TECHNOLOGY LEVEL
Flexible Manufacturing:
CHRYSLER GROUP
Chaining
Enabler 4: Chaining – Best Utilization of Existing Asset Base, Applying Flexibility
Within and Between Plants Without Facility Expense
Demand Swings
Model Mix
Asset Leveling
ABC
PLANT B
PLANT C
Plant
Plant
Charter A
Charter B
Charter C
Models
ABC
Models
FLEXIBLE MANUFACTURING
BILL OF PROCESS
LEAN MANUFACTURING
Volume
Plant
Volume
Volume
PLANT A
ABCD
Models
CHRYSLER GROUP
CHRYSLER GROUP
Smart Manufacturing Operational Focus
Traditional
Smart
Operations,
Engineering
Support Functions:
Quality, Maintenance,
PC
Supervisors
Operators
Team
Member
CHRYSLER GROUP
How Does DaimlerChrysler Respond Effectively and Efficiently
to Market Conditions and Volume Fluctuations ?
CHRYSLER GROUP
Global Sourcing
Basis: Flexible Manufacturing & Product Development Lay the Foundation
for Global Sourcing
REDUCE COMPLEXITY
Chaining
(Plant to Plant Flex)
Architecture/
Flexibility
Platform
Bill of Process
Global Design
Commonization
Volume Flexibility
LEVERAGE THE
BEST DEAL
• Volume Bundling
• Cost Savings
Model Flexibility
More Common
Tools & Equipment
Opportunities
• Global Sourcing
Leveraging
Low Cost
More Common Parts
Strategies
CHRYSLER GROUP
Global Sourcing: Manufacturing Example
Standardization of Manufacturing Requirements Has Enabled the Bundling of
Manufacturing Equipment Across Platforms/Plants
Weld Gun Standardization across vehicle lines/plants
Vehicle Lines
Covered
All Chrysler Group
Vehicle Lines, Stamping
& Bodyshop Requirements
Typical Placement Volume/
Design Complexity
Volume
(Guns per Design
Per Placement)
Prior:
• 300 guns per placement
• Avg. 200 unique designs
1.5 guns per design
per Placement
New:
• 1600 guns bundled
• 12 base gun designs
133 guns per design
per placement
Average
Price Change
-30%
BIW Roller Transfer Standardization across vehicle lines/plants
Vehicle Lines
Covered
Mid-Size Car, Truck,
Minivan Plant Bodyshops
Typical Placement Volume/
Design Complexity
Prior:
• Transfer sources
vary by plant
New:
• Common transfer source
for 5 plants
Volume Change
Average
Price Change
-
-22%
+ 500%
CHRYSLER GROUP
Global Sourcing: Vehicle Part Example
Global Design Commonization of Door Latches Drives Significant Cost and
Complexity Reduction
 Before, each business unit had similar latch
CG
concepts, but different parts and variants
MCG
 Now, DCX has one common global latch concept
with 83% common parts for all three business units
CVD
 Economical advantages of GL1 through significant
reductions:
- from 400 down to 100 parts
- from $35 down to $25 per car
- from 3 down to 1 supplier
- CG Savings: $10 M (2007), $24 M (2009)
 All new CG, MCG and CVD-Van models will be
equipped with GL1 by 2010; CG launch with Dodge
Caliber
GL1
CHRYSLER GROUP
How Does DaimlerChrysler Respond Effectively and Efficiently
to Market Conditions and Volume Fluctuations ?
CHRYSLER GROUP
Product Portfolio
We Have the Tools & the Knowledge to Leverage Flexible Strategy
to Drive Business Opportunity in NAFTA
Continuing the Product Assault in 2007:
Grand Cherokee
CRD
Sebring
Convertible
Ram 4500/5500
Chassis Cab
Viper SRT10
Magnum
Freshening
Liberty
New
New
New
New
JAN
FEB
MAR
APR
MAY
JUN
JUL
AUG
SEP
OCT
NOV
DEC
New
New
New
New
Caravan
Avenger
300 &
Charger
Freshening
Caliber SRT4
Sprinter
Town & Country
Dakota
Freshening
CHRYSLER GROUP
Product Portfolio
We Have the Product Expansion Strategy to Increase Offerings and
Drive Business Opportunity in NAFTA and Established Markets Overseas
Total Vehicles
RHD Vehicle
Offerings
Diesel Vehicle
Offerings
20
18
16
9
6
4
2003 MY
2007 MY
2003 MY
2007 MY
2003 MY
2007 MY
CHRYSLER GROUP
Product Portfolio
Our Flexible Strategy Must Be More Flexible in the Face of
High Fuel Prices and Global Competition
Fuel Price
Pressures
A Crowded
Marketplace, Growing Globally
$3.00
$2.80
Price Per Gallon
$2.75
$2.50
$2.25
$2.30
$2.00
$1.75
$1.50
Jan- Feb- Mar- Apr- May- Jun- Jul- Aug- Sep- Oct- Nov- Dec- Jan- Feb- Mar- Apr06 06 06 06 06
06 06 06 06 06 06 06
07 07 07 07
CHRYSLER GROUP
Room for Growth in Small Segment
Our Product Portfolio Must Be More Flexible to Meet New
Domestic Demand or Leverage New International Markets
Pickup
SUV
Minivan
70% of
Chrysler Group
Sales
CG Product
Line, Sales
Dominated by
Bigger
Vehicles
Passenger Family Truck/Van
Small
Compact
Mid-size
Full-size
Product Line is
NAFTACentric; Not
Balanced for
Global Growth
CHRYSLER GROUP
Product Portfolio
Our Strategy:
Global Balance
 Defend/grow NAFTA CG strongholds
 Add new non-NAFTA vehicle programs crucial to
global expansion
 Leverage 3rd party alliances to cost-effectively
access regional products/markets
 $5+ billion additional purchasing to low cost
sources – balance supplier footprint
CHRYSLER GROUP
How Does DaimlerChrysler Respond Effectively and Efficiently
to Market Conditions and Volume Fluctuations ?
CHRYSLER GROUP
Global Alliances & Partnerships
 Leveraging partnerships for growth and to manage costs
 Creative, efficient use of alliances to leverage geographic/market segment/product opportunity
Strong NAFTA
Position







Select Regional
Expansion
Small Vehicle B Segment
Chery Motors, China
Manufacturing (300C, Jeep)
Magna, Austria
Retail Network
Marketing Hyundai in Mexico
Internal Manufacturing
Minivan Assembly for VW
Diesel BlueTec Engine
Cummins, MCG
Focused Alliances
GEMA World Engine (HMC, MMC)
Hybrid
GM, BMW
CHRYSLER GROUP
Chrysler Group’s Flexible Manufacturing Strategy
May 17, 2007
John Felice
Vice President – Manufacturing, Technology
Global Enterprise
Chrysler Group
&