Automotive Design & Production, Nov, 2005 by Erkut Uludag, Stephen
Intense price-based competition in the automotive market has led OEMs to
launch various initiatives to reduce total costs in an effort to maintain
profitability. A key cost element for the OEMs to address after direct
material purchases is labor. Labor represents an average of 12 to 15 percent
(1) of a vehicle's manufacturing cost in North America. A recent study that
Roland Berger Strategy Consultants conducted for a major OEM determined that
a 20 percent improvement in hours-per-vehicle (HPV) would save in excess of
$800 million annually.
Hmmm.....I guess they should have consulted you before they wrote that.
According to you, their 2005 figures are waaay off.
Are you a Labor union Rep??
Yes Gm has LABOR cost of Building a Vehicle..which u Say is figure in
the price of The AUTO..
You are forgetting that Gm Buys parts from other companies and in the
price of EACH Part they Buy is The LABOR for that cost that Supplier
paid to make that product..
Steel workers WAGES/Labor is included in the price of the Steel,, So now
as an example, GM is ReimBursing the Steel industry for the labor to
process the Steel, ( Let Not ForGet the Miners Labor also)
So these labor cost need to be added to the Labor Cost that GM says it
With EVERY part Gm buys you need to ADD labor to the Cost.. Even the
labor For the Trucker to Deliver the parts
pure BS, as I said insurance costs alone added 1500 per car in 2005
for GM. Also it takes 6.5 man hours to buld just a 4L60e @70/hr or
about 455 bucks. (I know this because the coming 6L80/90 was designed
to be assembled by robots and cut labors cost by over 35% per unit) I
do not know where the author got his figures but he is dead wrong.
ALso gem spends just a like over 20 man hours @ 70/hr assembling cars
(this does not count hours to build sub assemblys) Toyota spends about
23 to 24 per car because of lower labor costs with resulting higher
quality control. YOu need to do a lot more research and a lot less
BSing because you are really clueless. If labors was such a low part
of vehicle cost detriot would not be hurting so badly and pickups
would not be 35 to 45 K.
Unless you have something besides your word, which has been proven to be
worthless, to back up your story, you might as well go back to that bottle
that you've been sharing with Tom.
At least I provided something that has been published to back me up. You
can't even do that.
Until you work for GM, (like some of us here do) you will not know the
truth. Media articles are nice, but about half of them are ever true.
In this case, your 70% figure is untrue. I do not fault you, because
you are just following news articles that the author failed to verify.
But at least now, we can correct you with the truth.
The truth is, about 15% of a vehicle is hourly and salary (5% hourly,
10% salary) labor costs. Labor costs also include each & every
employee, including CEO pay & options. People fail to realize that. GM
would fare much better if they severed or offered a buyout to the
salaried workforce. At the present moment, there are 5 salaried to each
hourly worker on average. With the exodus of hourly workers, GM has
failed to realize that cutting fat from the leg, does not remove fat
from the beer belly. But in order to win the media's love, blame falls
upon the hourly workforce. Sad to say, GM will not move forward with
momentum until they cut the salary fat as well.
As far as the argument about a $35k truck... Why doesn't the SUV made
in Mexico sticker price less than the same one made in Wisconsin? The
mexican workforce is without "high wages, legacy costs and healthcare
costs." If GM found a solution to the 15% labor costs, it will not
affect vehicle pricing, because it isn't a major issue, when component
costs are. Another myth.... busted.
Another thing. I receive a cost benefit analysis statement from GM
each year regarding the value of my pay & benefits, broken down to an
hourly figure. I know what that is, and it sure isn't $70. Please
stop using false information.
Heh... Your Toledo, Ohio Powertrain transmission plant figures are
wrong as well. Do you live in Toledo? I'll meet you this weekend for
lunch to discuss.
Snoman.. I agree with some things you say about other topics, but you
should really stay away from this one, since it is evident that you are
not proficient on this topic.
How much of an extra cost burden do U.S. manufacturers carry?
The National Association of Manufacturers estimated that, when compared to
its nine largest trading partners, the U.S. had a 18.3% cost disadvantage:
5.6% in corporate tax rates, 5.5% in employee benefits including health care
and pension costs, 3.2% in litigation costs, 3.5% in pollution abatement
costs, and 0.5% in rising natural gas prices. When the higher hourly labor
costs of U.S. workers was factored in, the total net cost burden was
calculated at 22.4%.
The cost of a automotive manufactured part/product is made up of the
following general cost categories:
. Raw Materials 50%
. S, G&A* 20%
. Operating Labor 15%
. Maintenance 8%
. Capital Equipment 7%
(S, G & A is a catch all category that includes traditional accounting S, G
& A as well
as depreciation and other corporate costs.)
I feel ya sno man, however, i think most engins today are far, far better then
anything in the
70's, and early 80's. Vega engins come to mind... burned oil right off the show
It gonna take government action to get rid of the piston slap issue in iron
engins, which are
going by the way side these days... so that means nothing gonna happen there.
go away after it get good and hot.
Could I bother you to listen to this wave file on this web site,
http://www.pistonslap.com/photos.htm ? It's supposedly a GM motor with
piston slap being recorded. The point of my asking you is as I know you have
extensive experience at GM dealerships in the service department, I'd like
your opinion on if this is a normal sounding motor that is considered to
have piston slap.
Personally I've never had any of my GM vehicles with any piston slap noise,
including my current 2006 5.3 liter. Nor have I ever heard one, hence my
request from you.
Anyway, Ian thanks for all the service advise you give, and I hope you have
a Happy New Year.
But, if the pistons were infact properly sized for bore you would not
have to wait for them to heat up and swell to stop rattle. Iy expect
to here this in a well wormn engine with many many miles and years of
usage on it, not a new one.
When pistons had skirts, you didn't hear piston knock when the
engine was cold. Unfortunately, as usual, you are stuck in the
Did you take note of the specs I provided? Much tighter
tolerances today then in the 70's!
No I am not but you are "stuck" on buying GM's excuse for poor quality
and tolerance control that causes this problem. Short skirt or long,
they will not slap "IF" fit properly from day one. It is too expensive
for GM to fit them properly in each engine and too expensive to fix at
dealer so it is now considered "normal" by GM to stem the blood loss
but "saying" it is all right does not make it right.
I'm going to have to call you on this one. I have been at several GM
engine plants to audit, and some of what you say is purely unsupported.
First off, they have never closely fit piston to bore, because the
bore & hone operations are not even close to the piston insertion
operation. Each block is bored & honed to a specific tolerance +/-,
which is audited every so often to make tooling adjustments & such.
Later on, and after some other operations, the cases (blocks) are moved
on pallets to the engine assembly area. After several more operations,
the cases make it to the piston insertion area. At this point, pistons
are inserted and capped. They always have been assembled this way, and
they have never been custom "fitted", as you imply.
As far as labor costs, I believe you're off the mark here as well. The
pistons are brought in fron a vendor, and therefore expected to be
within a certain tolerance +/- as well. Take this tolerance and couple
it with the variance in honing, and you can have quite a difference
that will be purely a roll of the dice... As you put it,i the worst
case, the large end of the tolerance. In this large tolerance
situation, if the bore is too large, it is not because of high labor
costs, because it would take longer to create a larger bore, than to
retain a smaller bore in machine cycle time. The hone operation cycles
for a certain time, then it moves on to the next hone station. Each
station has a finer set of stones, and is set to a different tolerance.
If labor costs were a factor, then bores would be tighter, since cycle
time would be shorter.
Part of the current problem is piston composition. Basically, they
just don't make them like they used to. Shorter skirts are the rave,
but not when it comes to pistons. Then we have the pistom
composition.. another stort entirely. Using your labor cost argument
here as well in regards to piston size, you will also relaize that it
would take longer to machine the piston smaller than it would be to
keeping it larger. Thus, machine cycle time to machine the piston to
the low/smaller end of the tolerance spectrum would cost more in labor.
Please understand that although a few thousandths only takes less than
a minute to accomplish, but when we produce thousands of engines, a few
minutes here & there add up to hours & days by the end of the year.
These are several added days of time that are added to (IMHO:
mistakenly) oversize the bore or overmachine the piston. So much for
concern over high labor costs eh? Keep in mind again, that pistons
have never been custom fitted to each motor, as you implied. I am in
the engine plants.. I would like to know if you have been?
Regardless, with the new GM 100,000 mile powertrain warranty, any
engine failure will be covered with model year 2007 and future models
sold in the last half of 2006 an so on. This warranty applies to the
same procedures & processes that have been in place. Nothing has
changed with the motors. This does not mean that I accept the piston
slap. It bothers me. But you did make an excellent suggestion
regarding bumping up the oil weight. 5w-30 is the worst oil to run in
these motors. I would run a 10w-40 in the winter weather and a HD-30
(straight 30) in the summer weather.
I wonder if GM and Ford are going to take into consideration that there are
those of us that are going to go somewhere else for our next vehicle.
I will never buy a Ford again and if this turns out to be piston slap on the
Denali, this will be my last GM product. I hope someone from GM is
calculating this into the equation.
"Now Phoebe Snow direct can go
from thirty-third to Buffalo.
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