Lean Expert James Womack Gives Ford Motor Co. Some Advice

In a reply to remarks made by Ford Motor Co. chairman Bill Ford during a Nov. 22 speech at the National Press Club, James Womack begged to differ with Ford's conclusions. In an article published in the Washington Post on Dec. 4, Womack pointed out that while Ford complained that his company "can compete with Toyota but not Japan," it was not an entirely accurate complaint.

Womack, president of the Brookline, Ma.-based Lean Enterprise Institute, said that the concept of North American companies not being able to compete with Toyota due to the Japanese government funded health care and pension as well as other subsidies, will not hold water. Why? Well, look at Toyota's presence in North America. About 65% of the vehicles that Toyota sells in North America are assembled in North America with workers who receive American-style wages and health benefits. Next summer Toyota will open its seventh North American assembly line in Texas with an eighth plant to open in Ontario in 2008.

The real problem, according to Womack, is that the Detroit automakers have not figured out how to use the Toyota Production System to pay for the pension and heath care promises that were inherited from Henry Ford back in 1914.

To access the full story visit http://www.washingtonpost.com/wp-dyn/content/article/2005/12/02/AR2005120201377.html.

The Lean Enterprise Institute


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