Automakers discover remote work, and they don’t hate it. Fiat Chrysler and Ford will be at full pre-COVID vehicle production levels this week. BMW is making strategic cuts. The Jeep Cherokee gets recalled for rollaway concerns. All that and more in The Morning Shift for Monday, June 22, 2020.
Working in cubicles in the Detroit metro area (or other geographic regions of automotive prominence) isn’t for everyone, but that may no longer be a requirement for those hoping to score a job working for a major automaker. That’s at least according to Automotive News, whose recent story As remote work grows, office needs reexamined discusses how three automakers—Ford, Toyota, and Daimler—are considering extending their work-from-home setup and possibly making it permanent to some extent.
Here’s what executive vice president of sales for Toyota Motor North America Bob Carter had to say about how impressed he’s been with the effectiveness of the automaker’s remote workforce. From Automotive News:
“I’ll admit that maybe my management was a little bit old school, where I was a little reluctant,” he said. Carter was concerned that “in a work-from-home environment in operations, we’re going to lose a lot of this efficiency that we’re famous for. But I can tell you proudly that our people have really stepped up.”
Carter said, for example, that Toyota had experienced a measurable productivity increase from its 300-person call center in Plano, Texas, after employees there started working from home.
“Work-from-home works extremely well for some of our associates,” Carter said.
Ford last week said it planned to survey 30,000 employees to see whether they want to continue working from home after September, the company’s target date to bring workers back to the office. In addition to allowing the company to focus putting its protective equipment in places where employees must be present to accomplish their tasks, extending the work-from-home setup would give The Blue Oval more time to prepare facilities to ensure employee safety. Plus, some employees seem to enjoy working remotely, as Ford said in a statement to Automotive News last week:
“As we make plans to bring back the remote workforce, many team members favored these new ways to work and found them empowering, flexible and cost effective,” Ford said in a statement. “This has inspired us to expand the optionality for this work arrangement beyond September, allowing employees to share their preference — remote, on site or a hybrid approach — in a survey that will be issued globally to the virtual workforce.”
Today’s Automotive News article about remote work in the auto industry also quotes Nicholas Speeks, CEO of Mercedes’ U.S. division, who had good things to say about his company’s work-from-home setup:
Last month, Mercedes-Benz USA CEO Nicholas Speeks ordered the German luxury automaker’s 875 employees at its Atlanta headquarters to continue to work remotely for at least the rest of 2020 and perhaps beyond.
“We are able to function effectively, and it gives people an opportunity” for better work-life balance, the CEO told Automotive News. He described the work-from-home policy as a trial without a firm expiration.
“We are going to see how that goes,” Speeks said. “It gives us an opportunity to try something different.”
The story mentions a number of advantages to the work-from-home arrangement, quoting Chief Administrative Officer of manufacturing and corporate resources at Toyota, Chris Reynolds, who talks about improvements related to hiring. From the story:
“If we’re now working from home and can do things virtually, do I care whether you’re in Plano, Texas, or Detroit, Mich.? I may not, depending on the job, as long as you can get to Plano periodically to meet with your team,” Reynolds told Automotive News Publisher Jason Stein as part of the “Congress Conversations” series.
“I think there’s a lot of potential here, where we can see, not just for Toyota but for many other companies, a broadening of the geographic footprint of our talent, which means more talent, which I think also means better talent. I’m actually looking forward to the upside, which is, I may have access to more talent than I did.”
Access to broader talent pools, improved morale, better efficiency, and even reduced real estate expenses are all potential pluses to keeping such an arrangement around, Automotive News notes.
This recent insight into the advantages of remote work is hardly isolated to the automotive industry—company’s around the world are reevaluating the prospect of allowing employees to continue logging into work from their own abodes. The Automotive News story quotes a consultant, who thinks that COVID and the associated shift to remote work may have permanently changed the way people work:
“I think we will not be returning to the way things were,” said Katee Van Horn, CEO of VH Included Consulting and Coaching and a former HR executive with a Fortune 500 company. “A lot of companies are seeing returns from a productivity perspective and an employee-happiness perspective.”
The auto industry was at a standstill for many weeks due to coronavirus shutdowns, but in May, things started ramping back up, though workplace safety concerns and supply chain constraints prevented automakers from bringing production back to full-tilt right away.
But now, after over a month getting things underway, Ford and Fiat Chrysler are set to be back at max capacity, the Detroit News reports. From the story:
...last week, [Ford] signaled it expected to return all U.S. plants to pre-coronavirus capacity by July 6.
Those plans have now been bumped up, thanks to the readiness of Ford’s workforce and supply base, Kelli Felker, Ford’s global manufacturing and communication managers, told The Detroit News: “We are pleased to be able to return to our normal operating pattern in the U.S. on Monday — which is sooner than expected — because our workforce and suppliers are able to support. The safety of our workforce continues to be our top priority.”
The article discusses Fiat Chrysler’s return to “normal” this week:
Fiat Chrysler builds the Jeep Cherokee at Belvidere Assembly. With the resumption of the second shift there, “all of our North American assembly plants will be back at their pre-COVID operating patterns next week,” Fiat Chrysler spokeswoman Jodi Tinson said.
Even GM is getting there:
“All of GM’s U.S. truck and SUV plants are back on three shifts and nearly all of our car and crossover plants are working the same number of shifts as they did pre-pandemic,” GM spokesman Dan Flores said. “More than 90% of our hourly team is back to work. As a course of normal business, we will continue to monitor the marketplace and adjust production as needed.”
In addition to bolstering safety protocols and dealing with supply chain constraints, the return to pre-COVID levels of production is a sign of strengthening car demand. From the story:
Detroit’s automakers are working to make up for lost time and replenish dealer inventories to meet demand that has been higher than initially predicted at the onset of the pandemic. The resumption of full production is a sign that “demand has remained relatively strong and that there’s a need for the products in the marketplace,” [vice president of industry, labor & economics at the Center for Automotive Research Kristen] Dziczek said.
Meanwhile, Toyota is still in the process of ramping up production, with Reuters saying the company admitted that it would build 10 percent fewer vehicles in July than it had initially planned. From Reuters:
The Japanese automaker said it planned to make 71,000 fewer vehicles globally in July than its original goal of about 700,000. While production has yet to return to normal, the July reduction is smaller than the 20% output cut for June.
“We expect the recovery trend to continue in August,” a spokesman said.
BMW has announced that it will cut 6,000 jobs, likely as a result of coronavirus-related reduced car demand. From the Detroit News:
The Munich-based maker of the X5 SUV and 3-Series sedan said Friday that it had agreed on the measures with employee representatives. Ways of reducing positions could include settlements with employees who are already near retirement, while younger people could get financial support for further full-time higher education with a guarantee of a job when they are done.
The job reductions represent just under 5% of BMW’s global workforce of 126,000.
Fiat Chrysler is recalling over 91,000 2014 to 2017 Jeep Cherokees equipped with two-speed transfer cases, as they may roll away under certain conditions, the Detroit Free Press reports. From the story:
“A review of customer data prompted an FCA investigation that discovered a driveline connection may, in certain circumstances, slip. Should this occur, it may lead to loss of propulsion and prevent the transmission from engaging park when the vehicle is stationary,” the company said.
Here’s the proposed fix:
The software fix is designed to deliver propulsion by engaging rear-wheel drive as needed. If park isn’t engaging, the software should automatically apply the parking brake, FCA said.
The recall affects 67,248 vehicles in the United States, 13,659 in Canada, 716 in Mexico and 9,940 in other parts of the world.
An FCA filing with federal regulators said about 1% of the vehicles have the defect.
Per the Detroit Free Press, FCA knows of one accident related to this failure, but it isn’t aware of any injuries. The automaker is set to mail notices to owners in July, and advises drivers to use their park brakes.
On June 22, 1934 “Reichsverband der Deutschen Automobilindustrie” commissions Ferdinand Porsche to design a Volkswagen subsidized by the state. The engineer born in Maffersdorf, Bohemia in 1875 initially worked at Daimler-Motoren-Gesellschaft, before opening his own engineering office in 1930. Porsche acquired a reputation as a brilliant engineer with his small car developed for NSU and racing cars designed for Auto Union.
Is working from home something you want to make a permanent part of your life?