The Electric Commentary

Wednesday, August 10, 2005

GM's China Innovation

From the NYT:

In this obscure corner of southern China, General Motors seems to have hit on a hot new formula: $5,000 minivans that get 43 miles to the gallon in city driving. That combination of advantages has captivated Chinese buyers, propelling G.M. into the leading spot in this nascent car market....

To build the cars, G.M. helped gut and rebuild a former tractor factory in ways that could become a model for automobile production in China for years to come.

Long white halls erected in 1958 during Mao's Great Leap Forward still stand here, the paint peeling in places, the wood window frames warped and the windowpanes cracked and broken. Inside, however, is a factory that combines old and new management techniques. Small, plastic racks of parts delivered several times or more a day have replaced large bins of parts delivered to the assembly line in big shipments every few days. This way, the factory can keep low inventories and order quick design changes, if necessary, from nearby suppliers.

Not surprisingly, the man who started this is no longer with GM:

In what may be a telling sign of the corporate culture at G.M., Mr. Murtaugh's success in China led not to promotion but to his departure from the company. G.M. declined to discuss personnel matters, but both it and Mr. Murtaugh said he resigned and was not dismissed.

Via Dan Drezner. You should read the whole thing, as well as Dan's post.


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