Tuesday, September 11, 2007

Chrysler curbs production after faulty part for 4.7-liter V-8 from Chinese supplier discovered

Web-posted Sep 11, 2007

By JOSEPH SZCZESNY
Of The Oakland Press

Chrysler LLC has been forced to curb production at four assembly plants recently because of a defective engine parts made in China. The three assembly plants, including one in Detroit and another in Warren, reopened Monday, Chrysler officials said. A third plant in St. Louis reopened last week, while a fourth in Newark, Del., will reopen next week, they said.

Chrysler spokeswoman Michelle Tinson said the company uncovered the problem in 4.7-liter V-8 engines just before Labor Day.

Shipments of about 15,000 of Chrysler's new 2008 models, including Dodge Dakota pickup trucks and sport utility vehicles such as the Jeep Grand Cherokee, Dodge Durango and Chrysler Aspen, were delayed because of concerns about the defective parts.

"It was a supplier-related problem," she said. "None of the faulty engines are in vehicles that are in consumer hands," Tinson emphasized. Tinson also said Chrysler and the principal supplier responsible for the sub-assembly uncovered the problem at about the same time during routine quality tests. Tinson, in keeping with long-standing company policy, declined to identify the supplier. However, a union official familiar with the engines, who asked not to be identified, said the UAW was notified the problem started with a small part made in China by a subcontractor. Tinson declined to comment on whether the part came from China.

China this year is expected to become the largest exporter of automotive components to the United States, surpassing Germany, the traditional leader, according to a new study published this summer. Carmakers have turned to Chinese suppliers for many small or common parts in recent years because they offer significantly lower prices than their European or North American competitors.

Chinese-made products have been under intense scrutiny this summer after inspectors, retailers and consumers uncovered an array of defective items.

The Chrysler plants in Warren, Detroit and Newark affected by the engine problems had been scheduled for a temporary shutdown four days after the Labor Day holiday, so relatively little production was lost, Tinson said.

Chrysler also moved up the date of an additional week-long shutdown at the Newark plant, Tinson said.

Restarting the plants, however, could be slow because the sequencing required by the just-in-time delivery system used at Chrysler assembly has been thrown off by the shutdowns and delays, union officials said.

The just-in-time system relies on sophisticated planning to get all the pieces for one particular vehicle into the assembly plant only a few hours before it is built. Coordinating the assembly of each vehicle is an intricate process and the build sequence is set several days in advance of each vehicle's trip through the plant.

Chrysler and other carmakers also have begun juggling production schedules recently to trim inventories in the face of declining sales during the summer months.

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