Ford's Innovative Approach to Vehicle Manufacturing
The automotive industry is grappling with an affordability crisis, as global car sales have remained stagnant over the past decade due to average households' inability to afford new cars. In an effort to streamline production and reduce costs, automakers are turning to innovative manufacturing methods, such as modular assembly.
One such pioneer is Ford, who, inspired by Tesla's 'unboxed assembly', is implementing this method at its Louisville assembly plant, scheduled to start in 2027. In unboxed assembly, a car is broken into several modules for more efficient production, allowing workers and robots to install parts from multiple angles simultaneously, reducing inefficiencies and wear and tear on workers.
Ford's Universal EV Platform project includes a modular assembly process, eliminating 40% of assembly stations and reducing the workforce by 21%. The company's Skunk Works operation in California, led by two ex-Tesla employees (Doug Field and Alan Clarke), is developing affordable EVs using this method.
Tesla initially proposed this new manufacturing method, aiming to make car production more efficient. Each module in Tesla's unboxed assembly includes all necessary parts and components for a specific part of the car (e.g., front, center, rear, floor, and roof).
Other automakers, including Toyota, BYD, and a European automaker, are reportedly developing their own versions of modular assembly. The need for a more efficient way to manufacture cars is clear, given the affordability crisis and the competitive advantage of Chinese automakers, who have a 30% cost advantage over others due to control of the global supply chain for electric-vehicle battery and motor raw materials.
The moving assembly line, which made Ford the world's largest car company, is an inefficient method compared to unboxed assembly. In the early 1900s, Ford faced a production problem, receiving 1,000 daily orders while only assembling 760 Model Ts a day. A team led by Clarence Avery proposed using conveyors to move components in the Highland Park assembly plant, inspired by grain mills and slaughterhouses. In 1913, the assembly time for a Model T was reduced by 78%, and production increased significantly.
The UAW's agreement to Ford's modular assembly plan suggests a strong relationship between Ford and the union at the Louisville plant, as well as the union's recognition of the importance of affordability in the automotive industry. Ford has promised that no union workers will lose their jobs due to the headcount reduction, instead handling it through normal retirement and attrition.
The Louisville assembly plant currently makes the Escape and Lincoln Corsair, but will be retooled for modular assembly in the future. As the automotive industry continues to evolve, it's clear that efficient manufacturing methods like unboxed assembly will play a crucial role in making cars more affordable for the average household.
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