GRAVATAI, Brazil - General Motors' Blue Macaw manufacturing park here will be one of the leanest and most cost-efficient car factories in the world.
To achieve that status, GM reached out to its supply base, seeking input on the design and engineering of the plant's only product, the basic Chevrolet Celta for the South American market.
The result is a relatively small, cheap-to-build plant put together in step with suppliers to run on a flexible, just-in-time basis. The collaboration meant GM needed 60 percent fewer suppliers and half the number of parts required in a traditional manufacturing setup.
Though not alone as a role model, Blue Macaw - tucked away in the Brazilian countryside - aspires to become a key template for future GM plants. But considering the automotive giant's somewhat erratic record on absorbing new ideas during the past two decades, how eagerly GM will embrace the Brazilian blueprint remains to be seen.
GM leaders, however, say they're ready to make the most of their latest manufacturing milestones. In coming years, planners of new GM manufacturing operations around the globe will look to Gravatai for inspiration, Chairman Jack Smith said.
'It is a major step forward in the way automobiles are built,' Smith said. Visitors 'will be studying it, they will be learning from it, and they will be adapting it to their own operations.'
The $556 million complex includes GM's 77,400-square-meter assembly plant - half the size of a typical US auto plant - and 16 supplier factories churning out modules for the Celta. Those suppliers contributed about $150 million to the project. One of them, Lear Corp., even occupies a position on the GM assembly line.
The setup has tremendous potential for GM, the world's largest automaker. And manufacturing experts are watching to see whether Blue Macaw becomes a learning laboratory.
'First they have to make it work, and then learn from it,' said John Shook, a partner in the Lean Enterprise Institute of Brookline, Massachusetts, USA. 'And GM has not been a good organizational learner. When it has had success, we don't often see it capitalizing on that - for example Saturn and NUMMI.'
Those two auto projects were hailed as groundbreaking when they arrived on the automotive scene.
NUMMI - New United Motor Manufacturing Inc., the 50-50 joint venture between GM and Toyota Motor Corp. - began production of small cars in Fremont, California, USA, in 1984. By deploying the Toyota Production System, NUMMI gave GM managers a close-up view of what made the Japanese industry so efficient. Saturn Corp., which opened its $1.9 billion Spring Hill, Tennessee, USA, plant in 1990, became a model for innovative labor practices and in-house component production.
Both NUMMI and Saturn ushered in progress for GM. But transferring those advances across the automaker's diverse manufacturing operations proved daunting. Managers from both ventures have been given new assignments at GM, but the corporation was slow to change.
Eventually, though, GM learned more from NUMMI than Ford Motor Co. ever did from its US automaking venture with Mazda Motor Corp., and more than DaimlerChrysler has from its 15-year-old US manufacturing alliance with Mitsubishi Motors Corp., contends manufacturing expert Ron Harbour.
Blue Macaw reflects that learning, as do five other greenfield plants GM has launched around the globe, said Harbour, president of Harbour & Associates Inc., a consulting firm in Troy, Michigan, USA. GM also has put those lessons to work at existing brownfield plants, company officials said.
And Blue Macaw itself is poised to be more than a one-time experiment.
'GM is smarter than that now,' Harbour said. 'They've learned their lessons.'
As a small plant in an emerging market, Blue Macaw is a low-risk gamble for GM with a potentially huge educational payoff. The question is where GM will be able to replicate the experiment.
Despite concerns that the radical approach may upset unions in the USA, Blue Macaw's innovations will be studied in North America, GM officials say. But two new US plants planned for Lansing, Michigan, will not be Blue Macaw replicas, they emphasize. Nor will those projects be a return to Project Yellowstone, GM's ill-fated plan to build small, profitable auto factories in the USA using supplier-made modules.
Still, practices from Brazil will migrate north, the company maintains, along with ideas gathered from NUMMI and the other greenfield factories in Germany, Poland, Argentina, China and Thailand.
Like Blue Macaw, the new Lansing Grand River plant, set to build the next-generation Cadillac Catera, will adopt GM's so-called one-piece flow setup, where body welding, painting and general assembly are connected without interruption. Grand River also will adopt the T-shaped assembly line seen at Blue Macaw. And like Blue Macaw, the Lansing project will work with its supply base to co-design components and simplify production processes, said GM executive Mark Hogan, who has modeled Project Yellowstone after Blue Macaw.
Despite the uproar that plan caused with the United Auto Workers union - and though it has been officially abandoned - greater collaboration with the supply base remains a key goal for GM. The automaker is looking for close proximity to suppliers and sequenced, just-in-time delivery of parts in its new manufacturing operations, GM officials say.
Going forward, GM would be smart to speed its use of best practices learned in Brazil, said Shook, also co-director of the University of Michigan's Japan Technology Management Program. Applications, though, will differ based on the market, the labor climate and the type of plant.
Company leaders maintain GM can move swiftly. One of its new weapons to spread innovation is the GM North American Project Center, launched last year in Pontiac, Michigan.
A global clearinghouse of sorts, the center gathers the most innovative manufacturing practices from around the world, both from GM and competitors, to use in new greenfield and brownfield projects. Experts in product engineering and operations work on a one-on-one basis with their counterparts at new projects, including the two in Lansing.
Master planning of that nature traditionally hasn't been a top priority for GM, said Joe Chao, who oversees the center for GM. But with the current emphasis on leveraging lean technologies throughout the organization, the company may find it much easier to put Blue Macaw to use around the world than it did with NUMMI and Saturn a decade ago.
However widely Blue Macaw pays off in the end, the project nonetheless marks a key step forward for the automaker.
Said consultant Harbour: 'Any time GM takes a little risk, I give them credit. It doesn't mean they're going to succeed, but frankly the only way they're going to learn is to, like a little kid, trip and fall.'