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SPECIAL

Ford Territory

SPECIAL

Ford Territory

Built to Order IRS

Staff, Monday May 20, 2002.

Page 1 of 1

Dana joins other suppliers including Venture and Air International that have moved to the Campbellfield site to provide components for the new Barra Falcon using the ultimate in 'Just In Time' manufacturing principles.

Each new Falcon that starts down the assembly line at Broadmeadows passes a bar code scanner. This triggers an electronic data message to each on-site supplier, specifying the model, trim level and suspension requirements.

Ford Material Planning and Logistics Area Manager, Alison Scoullar, said there were numerous benefits using an in-line vehicle sequencing system.

"It saves time, money and space. It removes the need for Ford, or suppliers like Dana, to store up reserves of the various iterations required for different Falcon models. This has the benefit of significantly reducing inventory costs," Scoullar said.

The new Control Blade IRS, for example, comes in four different settings and can be mated to a limited slip differential and/or traction control.

This level of complexity would typically require a huge storage area adjacent to the assembly line where workers would have to select the correct version and move it to the line. If a particular version was not available, the line would have to stop to wait for it.

Now, just two-and-a-half hours after the build order is received at Dana, a newly assembled IRS unit is trucked directly to the plant. Thirty minutes later it is bolted into the Falcon sedan that triggered the order.

Similarly, Air International will supply seats for the Barra Falcon on demand. Instead of taking up valuable space, they will be shipped every 24 minutes to the Broadmeadows assembly line, be taken up via a conveyor belt and delivered to the trim line when they are required.

?If a component is complex, expensive or physically large we will look at in-line sequencing,? Scoullar says.

?Previously, we required 400 axle and rear suspension modules a day for Falcon production and we always kept half a day?s production as a buffer in case of problems.

"Our old system would be incapable of coping with the added complexity of 16 different variants of IRS and the storing, selection and cost associated with the expanded range."

Scoullar said a comparison of all available options by facility and logistics engineers resulted in the in-line vehicle sequencing plan being selected.

"Firstly, it was not physically possible to fit all parts by the side of the line. Sequencing provided inventory savings of about $500,000 ? which translates directly into cash flow ? and saved another $500,000 in operating expenses.

"Sequencing also allows for future flexibility, allowing Ford the ability to manufacture any number of options without added cost. This means our reaction to customer demand can be quicker than ever before.

?With externally sequenced parts we only get the parts we need immediately.

?It also gives us a robust process that will not allow the wrong specification of IRS to be fitted to a car,? Scoullar says.

The system allows Ford to extend the range of derivatives in the future without having to add to the length of the assembly line.

A cost advantage to on-site suppliers such as Air International and Dana, is the elimination of bulky components being transported long distances. Individual components are bulk shipped in more compact containers, lowering freight costs.

?From Dana?s point of view also, they do not want to store large numbers of fully built up units either. Both parties enjoy cost savings and these mean we can offer products to customers at a lower cost,? Scoullar says.

The supplies of suspension modules arrive in trucks rather than on a conveyor system because trucking in the parts offers greater operational flexibility, as well as making it easier to recover the empty IRS transfer frames.

Because Dana supplies exactly to order, it has to work in sync with the Ford factory. When the Ford assembly lines are rolling, Dana?s has to as well, meaning tolerances for breakdowns or supply bottlenecks are slim.

?Holding inventory does give you time to recover from issues, but using in-line sequence build saves money since we don?t have to pay for stock sitting around,? Scoullar says.

?It?s better to work at a cost effective rate for 99 percent of the time and carry the risk."

The competitive nature of the automotive industry demands the continuing improvement of all processes. In the area of logistics, the need to reduce delivery times, reduce freight costs, reduce inventory within the supply chain and increase supply flexibility is very important.

The development of the Business Park next to Ford?s assembly plant achieves these key logistical elements by allowing the external sequencing of parts.

As the Business Park welcomes further suppliers, more systems will be supplied to the assembly line using the same electronic network, passing on to suppliers the benefits of lower freight and inventory costs, helping to lower the overall cost of the finished Falcon.

For further information contact:
Ford Australia Communications
Phone:(03) 9359 8491

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