Study: Toyota is most productive automaker

Ford, GM and Chrysler could narrow the gap even further in 2007, because they didn’t realize the full impact of productivity improvements in 2006, Harbour said. One of them could even overtake Toyota if production volumes don’t drop too much, he said.

“We should see a big improvement in the Big Three’s numbers overall in 2007,” Harbour said.

The Detroit Three have been steadily catching up to Japanese automakers. The difference between the most productive and the least productive automakers was 9.1 hours in 2004 and 16.6 hours in 1998.

GM had four of the top 10 most productive vehicle assembly plants, including the most productive plant in the study, Oshawa No. 2 in Oshawa, Ontario.

Joe Hinrichs, Ford’s vice president of North American manufacturing, said although his company is behind competitors, it has seen five straight years of productivity improvements.

“Our rate of improvement was better than some,” Hinrichs said.

He added that Ford has worked with union leaders on forging agreements to make plants more efficient. That includes allowing workers to do multiple jobs and contracting out traditional union jobs to save money.

Harbour said such agreements are a necessity as the Detroit Three try to return to profitability.

According to the study, Ford lost $5,234 per vehicle before taxes last year, followed by GM with a $1,436 loss and DaimlerChrysler, which lost $1,072 per vehicle.

In contrast, Toyota made $1,266 per vehicle, while Honda made $1,368 and Nissan made $1,575.

While Harbour gives the United Auto Workers and Canadian Auto Workers credit for helping the Detroit Three reduce costs, he said more must be done in the upcoming U.S. national contract talks.

“They have really come to the party here and made some really big improvements,” he said. “But there’s still some things out there.”

The Detroit Three have to erase productivity differences at any cost because their viability depends on it, Harbour said. Generally, wages and benefits cost the Detroit Three about $30 per hour more than Asian competitors with North American plants.

“It’s to the point now where some of those clauses in the labor agreements are now standing out. They’re really being highlighted,” Harbour said.

Nissan, which by Harbour’s estimates increased its hours of production by 5.3 percent in 2006, said it stopped providing data this year because collecting the information solely for the report was becoming costly and time-consuming, said spokeswoman Vicki Smith.

The Harbour Report, first published in 1989, measures productivity at assembly, stamping and engine and transmission plants. It calculates the number of hours worked by salaried and hourly employees at a plant and divides that by the number of units produced.

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