News from the other Trollhattan

A news story popped up overnight in the local Trollhattan newspaper, TTELA. It concerns production at the Saab plant in Trollhattan.

ctm has graciously provided a translation into English:

GM is set to change the layout of the production areas at the Saab Automobile plant in Trollhättan, thereby reducing the capacity for vehicle production. The unions criticize the proposal and plan to have an outside consultant looking into it.

The criticism came after the four unions at Saab Automobile was made aware of the plans for the future production of vehicles on the so called Delta platform. According to one of the unions, the proposal means a reduced floor area for vehicle production. The unions estimate that production at the Trollhättan plant will be downsized to about 85,000 vehicles per year. Currently, the volume is about 110,000 vehicles per year.

– “We don’t want a usage of the buildings that makes it impossible to increase volumes if needed later on,” says Paul Åkerlund, local chairman of Swedish union IF Metall.

After the decision earlier this year that Trollhättan was one of four plants to produce vehicles on the Delta platform, word from Saab Automobile was that the volumes was to stay at about the same level.

During the day, the unions have given out leaflets to the workers with information on GMs plans for future production. In it, the unions criticize the plans which they think not only is a waste of the plants current capabilities and but also threatens to permanently lower the volume.

According to the leaflet: “What we don’t want is to end up in a position were we can’t build more vehicles on the Delta platform if needed or begin production of other models as well.”

The unions outside consultant will work on an alternative plan to be presented to the company board at December 4.

Why would you deliberately look to rearrange a factory so that it produces less, and make it more difficult to upscale production if required?

We’ve only got the union’s side of the story here, but it does seem quite strange.

We’ll keep you posted.

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  1. Not having seen anything, one can only guess. However, flex manufacturing may be a partial answer — manufacturing several versions of the same platform on the same production line means more space for material and storage because more parts are necessary.

    The Graz, Austria plant in the Daimler family was the world-class example, building MB, Jeep and Chrysler SUVs on the same production line in any order, any quantity, any combination. Quite a feat of material handling and production planning. Of course, it means that they must have parts for all vehicles on hand. That takes room.

  2. I suggest the Unions go read the “Machine that Changed the World”. One of the fundamental principles is that you can manufacture more cars in a smaller space. The key to Toyotas success is eliminating that space for parts while producing a greater variety of vehicles a lot faster.

    I would encourage anyone to read it as it has a few interesting snippets about Saab and really gives the casual reader an idea of how the industry works. Apparently one of the key reasons Saab struggled in the late 1980s and were bought out was that the exchange rate killed them.

    Another interesting fact was that even in the days of the classic 900 only 25% of the parts were produced in house – the lowest of any manufacturer anywhere.

  3. None of us know exactly what it’s all about. My guess is this. GM want to maximise usage of the floor area and maybe be able to sell of buildings at the plant. That is a good thing since it lowers operational costs. But, doing so could make it really expensive to later on raise production if needed effectively giving that production to other plants. True, today they can be very efficient in designing a production line. But of course they not gonna have a line producing 85,000 cars a year if it can produce 110,000 a year. That is way to much overhead.

  4. True ctm. But remember the learing curve. Capacity in 2009 may be 85 000 units but this will increase each year is the process becomes more efficient. Shifts and overtime also affect the capacity.

  5. It’s not only to raise capacity. In Sweden, there are all sorts of laws when producing things in a factory. If they downsize and get a new permit for the plant based on that, it takes time and money to get new permits to raise production. The authorities look at the flow of products to and from the plant, and the impact on the local environment and on the traffic situations. The have to look into all sorts of harmful emissions from the production. The location of the Trollhättan plant is not the best, being close to a river and two cities. The laws for this kind of things are getting more restrictive all the time in Sweden. I think one of reason companies like producing stuff in Eastern Europe is the environmentally laws in countries like Sweden. Hopefully I’m wrong, and we don’t know exactly what GM is planning in the long term since we only know one side of the story. But my guess is that if it’s downsized, it wont grow again.

  6. Jon and ctm: All good points. I’ll take the reading suggestion — I hadn’t considered the exchange rate as a going factor for Saab, yet it was a factor for my Swedish employer during that period! (I worked for Flakt, a division of ABB.) How could I have missed that??

    And, as a C900 ‘vert owner, I can verify the low in-house figures — my whole freakin’ car was assembled in an outsourced plant!!

  7. Its a good read eggs, quite a lot on Ford, GM and Toyota but it addresses the difference between Japan, Europe and the USA. It also helps explain why the (seemingly) stupid things happen.

    ctm, easy for me to say, but have heart. I really believe Trollhattan has a future and it will be a bright one.

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