Ford begins US$1bn transformation at Cologne site (Germany)
Taking significant steps to transform its operations in Europe, Ford has committed to go ‘all-in’ on its electric passenger vehicles, as well as substantially grow and electrify its leading commercial vehicle business.
“We successfully restructured Ford of Europe and returned to profitability in the fourth quarter of 2020. Now we are charging into an all-electric future in Europe with expressive new vehicles and a world-class connected customer experience. We expect to continue our strong momentum this year in Europe and remain on track to deliver our goal of a six percent EBIT margin as part of Ford’s plan to turnaround our global automotive operations,” commented Stuart Rowley, president, Ford of Europe.
Ford’s latest sustainability commitments
Furthering its commitments to sustainability, Ford has announced new targets to have 100% of its passenger vehicle range in Europe zero-emissions capable, all-electric or plug-in hybrid by the middle of 2026, and all-electric by 2030.
In addition, Ford plans to make its entire commercial vehicle range zero emissions capable, all-electric or plug-in hybrid by 2024, with two thirds of sales expected to be all-electric or plug-in hybrid by 2030.
These latest commitments follow Ford’s Q4 report for 2020, announcing plans to invest at least US£22bn globally into electrification through to 2025.
Ford reports that its US$1bn improvement in structural costs has been central to its transformation of its operations in Europe in the last two years. The investments addressed underperforming markets, the creation of more targeted vehicle line ups, and partnerships to drive growth and profitability.
Ford’s US$1bn investment in its Cologne site
Driving its efforts to advance its operations into an all-electric future, Ford will invest US$1bn to modernise its vehicle assembly facility in Cologne (Germany) - one of its largest manufacturing facilities in Europe.
As part of its investment, the facility will transform its existing vehicle assembly operations into the ‘Ford Cologne Electrification Center’ for the manufacturing of electric vehicles. This will be Ford’s first facility like this in Europe.
“Our announcement today to transform our Cologne facility, the home of our operations in Germany for 90 years, is one of the most significant Ford has made in over a generation. It underlines our commitment to Europe and a modern future with electric vehicles at the heart of our strategy for growth,” Rowley said.
"The decision to make the production and development site in Cologne the e-mobility center for Ford in Europe is an important signal to the entire workforce. It offers a long-term perspective for our employees and at the same time encourages them to help shape this electric future," added Martin Hennig, chairman of the General Works Council of Ford-Werke GmbH.
Gartner: Leaders Lack Skilled Smart Manufacturing Workers
With organisations rapidly adopting industry 4.0 capabilities to increase productivity, efficiency, transparency, and quality as well as reduce cost, manufacturers “are under pressure to bring their workforce into the 21st century,” says Gartner.
While more connected factory workers are leveraging digital tools and data management techniques to improve decision accuracy, increase knowledge and lessen variability, 57% of manufacturing leaders feel that their organisations lack the skilled workers needed to support their smart manufacturing digitalisation plans.
“Our survey revealed that manufacturers are currently going through a difficult phase in their digitisation journey toward smart manufacturing,” said Simon Jacobson, Vice President analyst, Gartner Supply Chain practice.
“They accept that changing from a break-fix mentality and culture to a data-driven workforce is a must. However, intuition, efficiency and engagement cannot be sacrificed. New workers might be tech-savvy but lack access to best practices and know-how — and tenured workers might have the knowledge, but not the digital skills. A truly connected factory worker in a smart manufacturing environment needs both.”
Surveying 439 respondents from North America, Western Europe and APAC, Gartner found that “organisational complexity, integration and process reengineering are the most prevalent challenges for executing smart manufacturing initiatives.” Combined they represent “the largest change management obstacle [for manufacturers],” adds Gartner.
“It’s interesting to see that leadership commitment is frequently cited as not being a challenge. Across all respondents, 83% agree that their leadership understands and accepts the need to invest in smart manufacturing. However, it does not reflect whether or not the majority of leaders understand the magnitude of change in front of them – regarding technology, as well as talent,” added Jacobson.
Technology and People
While the value and opportunities smart manufacturing can provide an organisation is being recognised, introducing technology alone isn’t enough. Gartner emphasises the importance of evolving factory workers alongside the technology, ensuring that they are on board in order for the change to be successful.
“The most immediate action is for organisations to realize that this is more than digitisation. It requires synchronising activities for capability building, capability enablement and empowering people. Taking a ‘how to improve a day in the life’ approach will increase engagement, continuous learning and ultimately foster a pull-based approach that will attract tenured workers. They are the best points of contact to identify the best starting points for automation and the required data and digital tools for better decision-making,” said Jacobson.
Long term, “it is important to establish a data-driven culture in manufacturing operations that is rooted in governance and training - without stifling employee creativity and ingenuity,” concluded Gartner.