Chrysler Productivity Improves, Passes Ford

DaimlerChrysler AG's (DCX) Chrysler Group made the biggest gain in North American manufacturing efficiency last year, passing Ford Motor Co. (F) for the first time in a closely watched study of automotive productivity.

Chrysler, the smallest of Detroit's Big Three automakers, improved overall productivity by 7.8 percent from 2002 to 2003, the second consecutive year it made the biggest jump in the report released Thursday by Harbour Consulting.

Last year, Chrysler posted an 8.3 percent improvement.

The Harbour Report, published since 1989, tracks how many hours it takes to build a new car or truck — company by company, plant by plant.

In overall productivity, which includes assembly, stamping and powertrain operations in North America, General Motors Corp. (GM) was on top at 35.20 hours per vehicle, followed by Chrysler at 37.42 and Ford at 38.60. Honda Motor Co. (search) , Nissan Motor Co. (search) and Toyota Motor Corp. (search) submitted limited reports and were not included in the overall rankings.

GM, the world's largest automaker, improved its overall ranking 5.2 percent last year, contributing to a 25 percent improvement in the past six years. Ford's overall gain was 3.4 percent in 2003.

"Manufacturers that are using disciplined, common processes to drive consistent, sustainable improvement are seeing the most progress in the report's measures," said Ron Harbour, president of Troy-based Harbour Consulting.

New United Motoring Manufacturing Inc., the joint venture between GM and Toyota in Fremont, Calif., led the overall assembly rankings at 21.92 hours per vehicle. Next was GM's lone operations at 23.61 hours per vehicle, Mitsubishi at 25.43, Ford at 25.44 and Chrysler at 26.01.

Among individual plants, Nissan's Smyrna, Tenn., factory that produces the Altima ranked at the top of the list at 15.33 hours per vehicle, establishing a new industry standard. Smyrna broke its own mark of 15.74 set last year.

GM's two plants in Oshawa, Ontario, finished second and third at 16.40 and 17.03 hours per vehicle, and its two plants in Lansing were fourth and fifth. Ford's Chicago plant was sixth and its Atlanta plant was seventh. No Chrysler plants finished in the top 10.

"We're very pleased with the consistent progress we continue to see in our manufacturing productivity," said Guy Briggs, GM's group vice president for manufacturing and labor relations. "However, significant cost issues like out-of-control health care expenses will not allow us to rest on these accomplishments."

Thursday on the New York Stock Exchange (search), GM shares rose 72 cents to close at $48.06, Ford rose 18 cents to $15.58 and Chrysler rose 82 cents to $46.76.