BRUSSELS - Just as Ford Motor Co. is redesigning its car lineup in the distinctive new edge style, it is adapting its European factories to manufacture the new generation of products.
Ford reconfigured its plant in Saarlouis, Germany, to launch its all-important Focus lower-medium-segment car. It has now turned its attention to the massive Genk body and assembly plant in Belgium.
On 25 November, Ford signed a three-year agreement with labor unions on a long-term strategy to modernize Genk and keep it competitive.
In exchange for worker concessions that will result in the loss of 2,300 jobs - out of 11,130 employed at the plant - over the next three years, Ford will invest $650 million in the plant. About 900 of those 2,300 jobs will transfer to suppliers working in a $300 million park next to the Genk factory.
Ford said it saved about 500 additional jobs at Genk by creating flexible work patterns and some part time jobs. Three flexible shifts will be retained at the plant.
Ford plans to have Genk in shape to build the next-generation Mondeo, due in Europe in October 2000. A new Transit will be introduced in early to mid-2000. It will be built at Genk and at Southampton, UK.
'We have been working for five or six months on a very carefully prepared strategy with Genk,' said Ford of Europe President James Donaldson in an interview here.
Ford currently builds about 360,000 Mondeos a year for Europe and Asia at Genk. It also makes 75,000 Transits. With a 1.7 million-square-meter supplier park next door, the company expects to move out some of its in-house component work and lower its labor costs.
Ford executives have repeatedly expressed their concerns about overcapacity and the need to bring plants in line with demand. They say the Genk agreement will accomplish that in Belgium.
The Genk commitment is the latest in a series of manufacturing realignments in Europe by Ford.
Ford is in the process of shifting its Halewood, UK plant from production of the Escort over to Jaguar. The factory will make the forthcoming X400 'baby' Jaguar, which will compete with BMW's 3 series. Ford has hammered out an agreement with workers to allow more flexibility at Valencia, Spain, where the Ka and Focus are made. Valencia was the site of Ford's first supplier park. Ford is also bringing to an end its AutoEuropa joint manufacturing venture with Volkswagen in Palmella, Portugal.
Ford is reinvesting in its older plants, in effect turning brownfield sites into greenfield sites. Supplier parks are playing a large role in the strategy. They allow Ford to reduce transportation costs, outsource assemblies of modules and reduce the complexity of operations within the assembly plant itself.
At Saarlouis, for example, an instrument panel-steering column assembly for the Focus is delivered to the production line as a single piece via a 1,000-meter-long conveyor from the supplier park. When Saarlouis was building Escorts before the renovation and supplier park, the same assembly was put together on the production line as 300 separate pieces. The Focus itself has fewer parts than the Escort (3,000 against 4,600), even though Focus is a more complex vehicle.
The supplier park has reduced the number of truck deliveries to the plant by about 300 per day by delivering assembled modules to 16 separate drop points at the assembly line. An additional complex will be added to contribute parts for the forthcoming multi-activity vehicle based on the Focus platform.
Saarlouis is the lead plant for Focus, and the company plans to build about 1,700 per day there. Donaldson said the drive for efficiency will continue throughout Europe.
He said: 'We ask each plant manager why are they not running the most efficient plant in Europe.'