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Honda, Toyota Widen Efficiency Lead Over GM, Ford

Honda Motor Co. and Toyota Motor Corp. widened their lead in North American automaking efficiency over General Motors Corp. and Ford Motor Co. in an annual survey. DaimlerChrysler AG's Chrysler had the biggest gain.

Nissan, which provides data from only one of its four factories in the region, led for a 10th straight year with an average 17.3 hours to assemble a vehicle in 2003, the Harbour Consulting study found. Honda edged Toyota for second, followed by General Motors, Mitsubishi Motors Corp., Ford and Chrysler, which cut two hours from its time.

U.S.-based automakers are trying to narrow the gap with Japanese rivals to cut costs and devote more cash to boosting sales with incentives and new models. North American plants owned by the Japanese companies have led since Troy, Michigan-based Harbour started its benchmark rankings in 1989.

``That's a long time frame to know that you're trailing,'' said Brian Bruce, head of equity investments at PanAgora Asset Management, who helps manage $13 billion, including shares of General Motors and Ford. ``To still not to be able to catch up after that type of time frame is surprising.''

Honda, Japan's third-biggest automaker, moved ahead of Toyota by 2.4 minutes as it reduced its time to 20.65 hours. Toyota, Asia's largest automaker, averaged 20.69 hours. Honda averaged 22.3 hours the previous year, more than Toyota's 21.8.

GM, Ford, Chrysler

General Motors, the world's largest automaker, improved to 23.6 hours from 24.4. The 2.9-hour gap between General Motors and the slowest of the three biggest Japanese makers widened from 2002's 2.1 hours. Ford, the second-largest U.S. automaker, cut its average to 25.4 hours from 26.1, and Chrysler improved to 26 hours from 28. The industry average was 24.1 hours.

Toyota and Honda, in addition to taking less time to build cars and trucks, again also scored higher than General Motors and Ford in this year's J.D. Power & Associates survey of new-vehicle quality. Toyota was first and Honda second in that study, released in April. General Motors was third among the biggest automakers and Ford was fifth.

The Japanese lead in productivity because they design easier- to-build vehicles and have consistent processes from factory to factory, according to Harbour. That has helped them earn more per vehicle than their U.S. counterparts. Harbour estimates Nissan led in profit per North American-built vehicle last year at $2,402, followed by Toyota's $1,742, Honda's $1,488 and General Motors' $178. Chrysler lost $496 per vehicle and Ford lost $48.

Executives and analysts use the Harbour study to gauge competitiveness. Harbour, which advises automakers on productivity, analyzes output and employment data and interviews workers from every major automaker with factories in the U.S., Canada and Mexico.

Nissan, Japan's second-biggest automaker, and Mitsubishi Motors were the only companies in the study to require more time per vehicle than in 2002. Nissan rose from 2002's 16.8-hour average and Mitsubishi increased to 25.4 from 21.3.

General Motors plants in Oshawa, Ontario, and Lansing, Michigan, held the second through fifth positions among individual factories, behind Nissan's Smyrna, Tennessee, plant.

The Nissan figures were from only the Smyrna factory. The Tokyo-based company has declined to provide production data for its other North American plants in Mississippi and Mexico, Harbour said. The study also excludes some Toyota and Honda plants for which the companies won't give information.

Toyota, Honda and Nissan plants accounted for 19 percent of the 16 million cars and light trucks built in North America last year, according to Automotive News. Their U.S. market share rose to 24.1 percent in 2003 from 22.2 percent the previous year, according to Autodata Corp. General Motors, Ford and Chrysler fell to 61.9 percent from 63.3 percent.

Detroit-based General Motors led U.S.-based makers for a third straight year and has cut its time 18 percent since 1999.

``We're very pleased with the consistent progress we've made,'' Guy Briggs, General Motors group vice president for manufacturing, said on a conference call. ``We can't be satisfied. Our goal is to be the productivity leader'' to help make up for rising health-care costs.

Full Article Here


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If all of the Japanese North American plants were included, I wonder how the rankings would change. For example, Nissan's Smyrna plant runs at full steam and does well, sure, but how do the numbers change when Canton is brought into play? Canton's products are not selling all that well, so I cannot imagine the line speed, among many other factors, would represent super productivity at that plant. And the Sentra is a relatively simple-to-make car, and comparing that plant to LGR where the CTS is made is not quite the same. Though LGR has the highest productivity among luxury car-making plants in North America, the CTS is arguably a more complex vehicle to make. I could be grasping at straws, but if Japan denies Harbour access to all of their plants, who's to say that the numbers wouldn't reflect a closer race between the Japanese and Detroit?

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How could that whole article go by without them talking about the UAW and the lack of it in the japanese owned plants??????

not only that, but they give Nissan a pass on only releasing numbers for one plan yet touts them as the greatest thing since sliced bread!!!!!

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