Ford’s decision to build its baby Jaguar at Halewood throws up many challenges for the workforce in general, the plant’s engineers, and potential suppliers.
‘It is very early days,’ says Mike Beasley, Jaguar’s director of manufacturing operations, reflecting on how Jaguar intends to transform Halewood from a factory churning out Escort models to one producing 100,000 plus small luxury cars. ‘But we have got four years.’
Jaguar’s new car, code named the X400 – to be designed and developed at Jaguar’s Engineering Centre at Whitley in Coventry – is scheduled for launch in 2001. Halewood’s Body and Assembly Operations, which employs 3,000 workers producing 140,000 Escorts a year on a single shift, will continue to do just that until the end of the decade. Halewood will probably assume Jaguar management and identity around 2000.
Halewood has several inherent advantages. ‘There is a fair level of reusability across the plant,’ claims Beasley, especially in the areas of trim and final assembly. Another plus is that the paint shop – one of the most expensive requirements for any car plant – has benefited from steady investment since 1963, and has had up to £65m of investment over the past 10 years alone.
Changing the physical structure of the plant, including installation of a new line and new tooling, is only half the challenge. The rest falls squarely on the shoulders of the workforce.
‘What finally clinched it for Halewood, apart from the fact that we wanted to keep the Jaguar in the UK if possible, was the way the workers on the shopfloor and management have demonstrated a willingness to change,’ says Beasley.
This is echoed by Ian McAllister, chairman and managing director of Ford of Britain. ‘Jaguar completed a lot of analysis before identifying Halewood as its choice for the new car. I am confident that all employees in Halewood Body and Assembly Operations will meet the challenge of building this exciting new product.’
The workforce now faces a steep learning curve to adjust to Jaguar’s modus operandi but, says Beasley, they should be used to change.
‘They have already climbed a mountain over the past few years in terms of improving quality and productivity at Halewood, and particularly in accepting the fact that they need to change, and of the need for continual improvement.
‘Halewood is now as good as most European plants,’ he insists.
To meet these training needs, Jaguar has set a significant sum aside in addition to the estimated £300m development costs for the new car. The management part of the programme is expected to start later this year.
Beasley is confident it can bring Halewood into line with Jaguar’s way of working. ‘After all, we have had to do a similar thing at our own plants over the last seven years.’
But at that time the shoe was on the other foot. On its acquisition in 1989, Jaguar had to be brought in line with Ford’s way of operating, in an attempt to improve build quality and resolve supplier problems. This included the introduction of Ford’s Q1 quality standard for suppliers and implementation of Ford’s Total Productive Maintenance.
Jaguar has come a long way since then, as the launch of the XK8 last year bears witness. Last month Jaguar’s Brown’s Lane plant in Coventry became the first Vehicle Operations plant across Ford world-wide to achieve the Checkpoint D award of the FTPM process.
One of the main principles of FTPM is zero effort: that is, zero accidents, zero equipment downtime, zero rejects and zero waste.
The decision to opt for Merseyside made some industry watchers squirm as their minds darted back to the dark days when Halewood was an industrial relations troublespot.
Yet Jaguar and Ford, both traditionally conservative operators, have clearly been convinced of the merits of Merseyside.
And this is against a recent background of uneasy relations. This time last year Halewood’s workforce was on the verge of strike action over 1,300 planned job cuts by 2000 when it was announced the plant would not get the next generation Escort.
And at the end of last year, during the biannual pay round, unions representing the workforce pushed for a shorter working week.
The issue of pay and conditions is likely to surface again shortly, especially considering that the workers at Halewood work longer hours for less money than their Jaguar counterparts.
Workers at Halewood have been told there are no plans to change their terms and conditions but the inbalance will have to be addressed to bring all the plants into line.
When production starts in 2001 – as long as the UK Government stumps up grant aid funding – it will be the culmination of Ford’s 10-year plan for Jaguar, which has seen it invest probably as much as the £1.6bn it originally paid for the company in 1989, without much return.
Only now have sales really started to rise, with Jaguar last year recording its best year for eight years – a 12% increase on 1996 – with sales of 43,775. By 2002 sales could have quadrupled to 200,000, and Ford will reap the reward for its long-term strategy. And so will the UK’s automotive industry.
Supply on demand
Jaguar is keen to establish a supplier park on land adjacent to the Halewood plant. This would fit in with plans from Speke Garston Development, an arm of Speke Garston partnership, itself a joint venture with Liverpool City Council and English Partnerships.
It oversees a 146ha regeneration project and its new business park, The Estuary, is aimed in part at automotive components.
Any supplier park could use overhead conveyor links like those at Ford’s plant in Valencia, which brings components direct to the production line from suppliers in a just-in-time sequence.
Talks have started with existing X400 suppliers about the possibility of a supplier park. Jaguar sources two-thirds of its components from the UK and Ford’s Halewood suppliers will be bidding to win over the purchasing team.