The company is going to start running three shifts on some of its assembly lines, a pretty much unprecedented practice. Why?
The Obama administration auto task force that oversaw GM’s reorganization last spring was startled to learn that the industry standard for plants to be considered at 100% capacity was two shifts working about 250 days a year. In recommending that the government invest about $50 billion in GM, the task force urged the company to strive toward operating at 120% capacity by traditional standards.
But industry manufacturing experts are skeptical, noting that the federal task force had limited automotive experience. “Do those guys understand the business?” asked Ron Harbour, whose Harbour Report is a widely followed analysis of auto-plant efficiency.
Some years back, I moved to a different work assignment and brought a whole lot of attitude with me. I figured that, if I was smart enough to oversee the construction of an armored space station with enough power to destroy an entire system, I was smart enough to oversee anything. I quickly learned otherwise. You might see it was my Darth Fiorina moment.
Obama has yet to learn that lesson.
Then again, it may be a matter of different goals. If your goal is to maximize profits by producing cars at a cost that is less than the price people are willing to pay, then running your assembly lines 24/7 apparently makes no sense. But if your goal is to maximize union worker employment, it makes quite a lot of sense.