- In just a few weeks, the US auto industry has completely suspended vehicle manufacturing and switched to making medical equipment and ventilators to fight the COVID-19 coronavirus pandemic.
- The speed at which giant companies such as General Motors, Ford, and GE have come together has been impressive.
- But America’s carmakers have done this before, during World War II.
- Much has changed in 80 years, but the manufacturing talent in America’s big car companies can still rapidly shift to dealing with national challenges.
- This is an opinion column. The thoughts expressed are those of the author.
- Visit Business Insider’s homepage for more stories.
In prosperous times, we take the US auto industry for granted, when we aren’t complaining about it. But in times of crisis, we see what companies are made of, and as the COVID-19 coronavirus pandemic rages, it’s been clear that America’s carmakers have a vital role.
As in World War II, when Detroit became the “arsenal of democracy,” it isn’t about making and selling cars. In the 1940s, automakers converted to making tanks and planes to defeat the Axis powers and preserve freedom; in 2020, General Motors and Ford have, in the span of a few weeks, completely stopped making vehicles and started making medical face shields, masks, respirators, and in collaboration with healthcare companies, tackled the imperative ramp-up of ventilators.
American manufacturing has been hollowed out in the past few decades, but because the auto and medical markets are still huge in a country of 330 million people, the US still has dozens of car factories and, more importantly for the coronavirus fight, dozens more supporting facilities that can be repurposed to produce medical supplies. GE still makes stuff in the USA. The United Auto Workers also has a skilled workforce that numbers 150,000.
Running a car company is an intricate undertaking. It demands a staggeringly high level of operational expertise — exactly the managerial talents that are ideally suited to rapidly reorganizing one type of production and devoting it to something else entirely. Ventilators aren’t cars, but both GM and Ford knew immediately that they could offer their supply chains and capabilities to swiftly scale production to partners such as Ventec Life Systems, a small Seattle manufacturer, and GE Healthcare, a giant with decades of experience.
Manufacturing is manufacturing — that’s why carmakers and healthcare companies can collaborate
So while ventilators aren’t cars, manufacturing is manufacturing, and the managers and engineers who can do it at an industrial level are predisposed to work together. That’s why GM, Ford, Ventec, and GE could come up with plans in a matter of weeks. They’ve been improvising from a position of strength.
Ford thinks that it could soon have shipped a million face shields by the end of this week — after getting started making them just a week ago. The company also thinks it can build 50,000 ventilators in 100 days, with production to hit over 7,000 per week after that.
GM has converted an electronics plant into a ventilator factory and could be making Ventec devices in the next few weeks.
As these companies have intensified their efforts to meet the COVID-19 challenge, the executives overseeing the work have shown an impressive ability to speak with a coordinated voice. Ford and GE Healthcare’s media calls have made it sound like growing medical collaboration has already created a sort of merged management structure. GM and Ventec have likewise started to communicate with a unified message.
Make no mistake, the crisis wasn’t in anybody’s playbook. All the Harvard MBAs in the world were meager preparation, and the leaders who saw Detroit through World War II — many of whom later joined the auto industry — are long gone. What’s been making things happen is the nature of the manufacturing sector of the US economy. It isn’t flashy, but it attracts some of the best people, as we’re now seeing.
Manufacturing should be central
It should be clear to Americans that manufacturing should be far more central in the nation than it has been. That doesn’t mean it should be nationalistic; German and Japanese automakers in the US are likely to lend their equally formidable expertise to the coronavirus fight, and supply chains are global now in ways that would be impractical to reinvent and detrimental to regional markets if they were more intensely localized.
It should also be clear to Americans that manufacturing shouldn’t be politicized. President Donald Trump spent 2016 attacking the automakers that have now stepped up in record time to mitigate a ventilator shortage that was apparent years ago. More recently, he and his Defense Production Act overseer, Peter Navarro, have assailed GM and CEO Mary Barra and set up, at least optically, a dangerous horse race between GM and Ford to see who can make ventilators faster.
There are no winners or losers when the stakes are life or death. There are only problems to be solved, as rapidly as safety allows.
The best day-to-day problem-solvers in the industry work for car companies. They solve problems within structures that, to some more entrepreneurial observers, might look rigid or hierarchical, ripe for “disruption,” to use the buzzword that’s taken over all of business. But the truth is that the bright minds and determined managers of companies like GM, Ford, and GE are always ready disrupt themselves, on a dime.
And when they shift gears, they shift big. They did it 80 years ago, and they’re doing it again.
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