Is it a lot to ask of a car to be able to have a conversation or listen to music while driving on the expressway? Maybe so, because I can’t seem to find a car that can enable me to do so.
My wife’s lease is up on her 4-door Camry, and we are searching for a vehicle to replace it that does not require a scream to answer a question.
The problem of cabin sound appears to be multifaceted. One issue is that I wear hearing aids which amplify background sound which can drown out human conversation. There are adjustments to modify this issue in the control module in my phone, but that is impractical, particularly while I am driving.
Another complication appears to be the 4-cyclinder engine in the Camry which is noisy and seems to have to huff and puff to push a 4-door, full-sized sedan from place to place.
Tire noise on fast highways is another noisemaker. It grinds through the floor relentlessly. Add in meager sound insulation in the doors and you have the almost debilitating drone of a Camry and evidently most of the cars being sold today.
Going electric is an option, but that does not address most of the sound generation that drives me into silence.
Does anybody know of a viable option for people with a noise aversion?
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Major League Baseball’s spring training begins again this week in Arizona and Florida. This is a blessed event for me. It is a sign of hope that another brutal winter in Chicago is finite. Hallelujah.
It also means hope is alive for another successful season for my beloved Chicago Cubs who have a new manager, David Ross, who was a second-string catcher during the Cubs recent golden period of 2015-2017. I loved the former manager, Joe Madden, but the team seemed to need a change and a $5-million-dollar-a-year boss whose contract had expired was an easy target. Madden quickly caught on with the Los Angeles Angels.
Another hopeful sign for 2020 is the hated Houston Astros have been found out as cheaters who used high tech to steal catchers’ signs and then used crude banging of a garbage can lid to alert their hitters to a fastball or off-speed pitch. In the 2017 World Series they devastated Yu Darvish, then a top pitcher with the Dodgers, by informing hitters of what kind of pitch was coming. People thought Darvish was “tipping” his pitches, but really it was the devious Astros who stole his catchers’ signs. The incredible improvement in batting contact made by Houston hitters should have alerted Major League Baseball to the chicanery of the Astros, but the baseball honchos did not act until former Astros players spilled the information.
It is possible the Boston Red Sox may have done similar dirty tricks in their World Series season in 2018, but the verdict has not come down. Their manager, Alex Cora, did get fired, however.
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The battle for the Democratic Presidential nomination is fascinating and scary. It appears Bernie Sanders will face off against Donald Trump, with Michael Bloomberg possibly running as a third option.
Many people think this match-up is a sure win for Trump. I’m not so sure. More later.
Question: What car would you buy to get a quiet interior?
Tesla stock sold for $169 per share in June of 2019. People were wondering if Tesla was today’s DeLorean. Its 2025 bonds were paying 7%.
Today, Tesla stock roared past $900 per share. What happened in seven months, and what does it mean for the machining world?
Obviously, the short sellers got killed. The stock has a rather thin float for a significantly traded company, which makes it volatile. But even the doubters, and there are loads of them, must admit now that Elon Musk has done an amazing job in building a car company from scratch.
There were hot moments when cash was short, and he pushed everybody to work overtime to hit the production goals for the Fremont, California, plant on the mid-priced Model 3. Then he surprised most people by surpassing sales targets. He did the impossible again by building the enormous battery plant in Nevada and somehow putting up a huge plant near Shanghai and rolling the first cars out before the end of 2019.
Meanwhile, GM and Ford are lumbering along with their electric car plants in the Midwest, while Tesla is starting its European plant in Berlin.
I have always been a Tesla skeptic and never bought the stock, but now I must admit that Musk has an astounding track record on cars and somehow finds time to build his SpaceX dream into a viable entity, too.
The aspect of Tesla which I think most people have missed is the amassing of data for producing a viable autonomous car. Tesla has had a few fatal accidents with its self-driving cars, but Musk, the supreme risk taker, evidently has made the calculation that getting to the end line first in both electric and self-driving is worth the damages incurred when screwballs push the envelope or fall asleep. Google’s Waymo has been much more conservative, avoided tragic accidents, but is a distant second to Tesla in data derived.
The Europeans like BMW and Audi, the cautious American car companies, and the ultra-conservative Japanese are way behind and stumbling. The $900 stock value of Tesla is the world waking up to the farfetched idea that Tesla may have a tremendous first mover advantage in both electric and self-driving vehicles that few people thought possible even a year ago.
It is possible that neither category becomes enormous, but it seems likely to me that at least one of them is the jackpot.
On the other side, Exxon stock is down 12% so far in 2020, and oil prices are sputtering. Electric vehicles gaining traction and, to a lesser degree, the rise of self-driving taxis, mean fewer machined parts. In our machine tool business we see people hedging their bets on automotive work. It isn’t going away, but it certainly does not look like a growth business unless you are in the Tesla orbit.
Our customers who are heavy in auto and small truck are looking for diversification, which has pushed them into Swiss-type machining and away from multi-spindle screw machine work. The brutal competition for high-volume auto work has also forced our clients to take automotive expertise to other more appetizing areas.
Yet the conventional wisdom that automotive work is an idiot’s game may turn out to be wrong, too. The automotive supply chain’s reliance on China is showing itself to be vulnerable. The Trump tariffs, Chinese theft of intellectual property, the threat of the Hong Kong demonstrations spreading, and now the Corona Virus epidemic are exposing the danger of becoming too dependent on China outsourcing.
Despite Tesla stock hitting $900 on Tuesday, it would be a mistake to give up on old school gasoline vehicles driven by human beings, at least for the next 10 years.
Question: Is automotive work too risky to be in?
For most people manufacturing and Israel are two topics that are not normally spoken about together. Patrice Zamor, the guest on today’s podcast, lives in both of these worlds.
Scroll down to listen to the podcast.
Patrice emigrated to Israel from France in the 1970s and has spent much of his career working for Ditron Precision, a multi-national automotive component supplier headquartered there.
Takeaways from the interview:
- Patrice discussed Israel’s strength in high-tech fields as well as its significance in producing machined components for international markets.
- He gave his outlook on the current world automotive industry.
- He talked about Israeli culture and what inspired him to emigrate from France.
Question: Is Israel a place you want to visit? Why?
In today’s podcast we interviewed Jeff Reinke, Editorial Director of Industrial Equipment News (IEN). He gave his take on several of the fastest emerging trends in the machining business, including electric cars and 3-D printing.
Reinke said that right now Elon Musk is suffering the consequences of overpromising and underdelivering on his products. He said that Musk is a unique car company CEO because when certain projects suffer setbacks he stubbornly charges forward instead of shelving them as other car companies would.
This boldness enables Tesla to develop innovative technology that sets the company apart from the established but conservative automotive makers.
Reinke said that when the big car companies start producing all-electric vehicles on a large scale Tesla will have to develop a niche to survive the market. Not having a niche could lead to being acquired by an established car company seeking to obtain Tesla’s technology.
The big question is whether the majority of consumers will follow the electric technology or if they will stubbornly hold onto their current gas vehicles.
Reinke also said the advancement in 3-D printing is one of the current trends in machining he is most excited about. He said it is fueling the demand for customization and he is impressed by the cost-effective materials available for the process such as carbon fiber and metal. However, Reinke believes that for the near future large volumes will still be made with conventional metal cutting equipment rather than using additive manufacturing.
Question: Does producing guns with 3-D printers scare you?
Miles Free, Director of Research and Technology at the Precision Machined Products Association, opines on electric cars, economic patriotism and how American machine shops have evolved to thrive in today’s economy.
Question: Are tariffs aimed at China economic patriotism or a tool for the enemy?
Listen to Swarfcast in the player below.
Last Sunday 60 Minutes did a story on Chrysler’s great comeback since Sergio Marchionne of Fiat took the reins of the company in 2009. When Marchionne came on, Chrysler used a $6 billion high interest loan from the U.S. Treasury to modernize the company’s plants with state of the art equipment, upgrade 16 existing car models in just 18 months and begin integrating Chrysler and Fiat’s operations. Last year Chrysler turned a $1.83 billion profit and paid back its $6 billion federal bailout six years ahead of time.
When Marchionne came on, one of the first things he did was overhaul the company’s hierarchical management structure. He appointed 26 new young leaders from within the company, many of whom had not previously been at the top of the food chain, to report to him directly. He then vacated the chairman’s office on the top floor of Chrysler headquarters and moved his office to the floor with the engineers so he could better connect with the people designing the products. The revitalized company has recently come up with ingenious advertising campaigns such as the Superbowl ad with Clint Eastwood and the “Imported from Detroit” commercial featuring rapper Eminem.
Marchionne’s story at Chrysler reminds me of Theo Epstein’s recent hiring as the Chicago Cubs new President of Baseball Operations. Epstein, the man who many credit with ending the Boston Red Sox “Curse of the Bambino,” immediately cleaned house, keeping only a handful of front office people from the previous Cubs regime. He then assembled a management team composed of several guys from his former Boston and San Diego stints. This offseason, in a matter of months, the Cubs went from having the smallest management team in the Majors to having one of the largest with an army of scouts. Epstein quickly cut large salaried players and traded a few popular ones for players he considered undervalued. He hired Dale Sveum as the new manager, a coach with a decent baseball pedigree but definitely not the sexiest crowd pleasing candidate available. Epstein believes that Sveum will change the team’s culture to emphasize fielding fundamentals and accountability, the basics it appears the team has lost.
Epstein and Marchionne were brought in to run the Cubs and Chrysler because the organizations needed a reboot. Quick fixes just wouldn’t cut it anymore. Radical, fundamental change was the only choice to succeed.
Why do people believe these guys will succeed where so many others have failed? Because they don’t have the same handcuffs which hinder most managers. They appear to have no fear to try new radical things even if it may mean hurting feelings, laying people off, creating a lot of new work, or just failing in front of everyone.
Most people are inclined to make decisions based on “how things have always been done,” and much of the time we are unconscious that this is the basis for our decisions. People also make wrong decisions because trying new things, although exciting, is scary. The Cubs will probably have to lose a bunch of games before they start to dominate. Maybe the next new Chrysler model will be an Aztec. The greats can deal with these possibilities.
Take a step back and examine your business, or your personal life for that matter. Are you too scared to make changes which likely are imperative to succeed and be happy? Do you have the guts to make decisions like a turnaround master? I need to work that out with my shrink next week.
Question 1: Which will happen first, Chrysler is Number 1 in American car sales, or the Cubs win the World Series?
Question 2: Does using Clint Eastwood and Eminem to advertise cars offend you?
Watch the “60 Minutes” Interview here
In mid-December I trekked 3 hours from Chicago to Northeast Indiana for a tour of manufacturing companies put on by the Northeast Indiana Regional Partnership and Indiana Michigan Power. On paper the trip didn’t exactly have the same allure as my last two traveling assignments for Today’s Machining World (to Japan and France), but the people and the companies I encountered on the trip may have been the most genuine, shrewd and successful out of the three destinations.
Turns out, when it comes to manufacturing Indiana is where it’s at. Over 40 percent of Indiana’s workforce is involved in manufacturing. A variety of industries have thrived there because of the state’s low taxes, its educational system which encourages young people to train in technical skills, and a culture which keeps manufacturing in vogue.
Many Indiana job shops such as C & A Tool in Churubusco invite students and teachers of a wide range of ages to come to their facilities to learn about factory equipment. C & A for instance shows teachers how to use comparators so they can demonstrate to their students practical applications for geometry. The Northeast Indiana region is also currently starting up what are known as New Tech Schools, which focus on teaching students creative problem solving and working in groups on practical technical projects.
I encountered another interesting spin on education when we visited Fort Wayne Metals, a thriving 500 employee company specializing in the production of wire for medical devices. The company’s CEO Scott Glaze offers to pay for a baccalaureate degree for every company employee. Employees are allowed to study any subject they choose, from history to the culinary arts. Glaze himself got a history degree many years after working in the family business and then felt it was important to have a well rounded educated workforce.
Micropulse was another impressive company we visited. President and CEO of the company, Brian Emerick, recounted the story of his company’s evolution from a small job shop in 1988 that produced for a variety of sectors to become a 200 employee operation which today produces parts almost exclusively for the medical industry. The company prefers to focus on producing medical implants because medical instruments are more of a commodity product, making them much less lucrative. Micropulse has also in recent years created incubator companies housed in its own facility, in an area it calls the “OrthoVation Center.” Micropulse provides resources for the startups such as administration, accounting, information technology, product design, testing, prototyping, distribution and inventory management. After the new companies have developed a specialized niche, Micropulse spins them off and then can become their exclusive supplier.
Unlike Micropulse, C & A Tool prefers to serve a diverse group of sectors in addition to medical, such as aerospace, fuel systems and automotive. Our guide from the company, Rob Marr, told us that C & A never wants to turn down jobs because producing parts for a variety of sectors strengthens the skills of the company. The company believes that knowledge gleaned from running one type of job enriches its abilities to run other types. During the downturn, the company even cross trained its less busy employees in programming by teaching them to make custom license plates.
We also visited Steel Dynamics, the fifth largest steel company in the U.S. Kieth Busse, the CEO and founder of the company who just retired at the end of 2011, is one creative, shrewd Hoosier. According to Busse, the labor cost at Steel Dynamics is about .25 man hours (15 minutes) per ton of steel, while it takes around two man hours per ton at U.S. Steel. Busse came from working at Nucor and implemented a non-union, incentive based model for paying employees similar to Nucor’s. However, Busse told us that the incentive system of Steel Dynamics differs from that of Nucor because Nucor rewards employees mainly for how many tons of steel they produce, while Steel Dynamics uses a formula that figures in the actual cost effectiveness of the employees’ work. The employees are rewarded for increasing the company’s profits by reducing waste, rather than being paid just for steel they churn out. They also receive stock options and bonuses based on the company’s profit, which further instills a sense of ownership, unity and loyalty. Steel Dynamics is the only steel company that paints its own steel, an idea which one of its employees came up with.
Question: Do you like where you live?
Emily Halgrimson, Today’s Machining World’s Managing Editor, was invited to join 11 other journalists from the U.S. and Canada (six in the automotive sector and six in the food industry sector) by the government of Thailand’s Board of Investment (BOI) on a four-day media tour to promote Thailand’s industry around Bangkok and the Southeastern seaboard.
Saturday, January 14th 10 a.m. – Left Chicago’s O’Hare International for Thailand on American Airlines. It’s not comforting to fly a bankrupt airline’s 757 over the Pacific. The distance is a drawback to North Americans doing business in Southeast Asia – 15 hours to Shanghai and another six to Thailand is a haul. I was pleased to find PBS’s excellent series, Downton Abbey, on the inflight entertainment, but slept most of the way thanks to Benadryl.
Sunday 10:30 p.m. – Arrived at the airport in Bangkok, and while waiting for the other journalists to arrive, ate some of my favorite Thai food of the trip – deep-fried pork with a red coconut curry sauce and Tom Yum soup. Made a vow to eat only Thai food for the duration – was not a problem. Transferred to our five-star hotel, Novotel, and were welcomed with plates of Thai deserts, wine and palm-to-palm bows by all.
Monday 8 a.m. – Totally jet-lagged. We visited Western Digital’s (WD) plant in a recently flooded industrial estate near Bangkok and were met by John Coyne, President and CEO. Forty-five percent of the world’s hard drives are produced in Thailand, and WD, worth $10 billion, is the largest company. Their plant was under 1.9 meters of water only weeks before our visit. Divers come in for the most valuable equipment and moved it to a kind distributor’s facility 100 km away so they could decontaminate and repair it while the floodwaters lingered. WD employs 38,000 Thais, most who make under $10/day. I’m not sure what I was expecting, but the modern clean plant was a total surprise. It contrasted heavily with outside the industrial parks, where the country’s poverty is more obvious. Western Digital’s projections for 2011 were $176 million; because of the flood they reached $119 million. No word yet on the cost of the cleanup.
Monday 11 a.m. – Headed across town to the Thailand Board of Investment’s (BOI) Fair. This was interesting. When Westerners hear the word “fair” we think animals and Ferris wheels. In Thailand, a fair is a showcase of the country’s industry direct to the consumer. The fair happens only once every 10 years and was a huge deal. The King of Thailand – whose authority and respect are reminiscent of Kim Jong-ll – is a “green nut,” and the green theme is seen country-wide. The “Royal Pavilion” showcased a “green themed” 3-D film, complete with a tree growing up from the middle of the room, and the finale – a real rain shower (watch your camera). Huge exhibits in the outdoor park included Toyota, the most popular carmaker in Thailand; Chevy, which had its own 3-D show about the evolution of the American-born automobile; and CP, a huge frozen food conglomerate born in Thailand who’s big in Costco. The show also had a beer garden (hint-hint IMTS organizers) and a joyous sort of “look what we have in Thailand” feel to it. The people of Thailand are proud of what they’ve done in attracting these international companies over the last 20-30 years, but seem cognizant of environmental mistakes the U.S. and China have made during their development, and are making an effort to not repeat them.
Tuesday 8:30 a.m. – Attended the BOI CEO Forum. Guest speaker: Tony Blair. A very inspiring and encouraging speech. Interestingly, he noted strongly that America would not be where it is without its open immigration policies. Mr. Blair encouraged Thailand to create this immigration-friendly atmosphere now, and noted that Thailand has “enormous potential” – its people, geography, and relative stability. He emphasized that Thailand’s job was to let the world know that it’s “open for business.”
Tuesday 3:30 p.m. – Left Bangkok for Pattaya, a tourist city next to the Eastern Seaboard Industrial Estate (ESIE) and checked into our spa hotel on the beach – filled with Russian vacationers. Two Thais told me that the Russians are disliked, they are stereotyped as being cheap.
Development in the industrial estate was shocking, in a good way. The government invested millions in infrastructure to attract international companies interested in supplying the Eastern Hemisphere. Roads, electricity and water supply are new, modern and reliable. Ate a fresh seafood dinner at a beach restaurant while the sun disappeared over the ocean and the beer and conversation flowed. Beautiful.
Wednesday 9 a.m. – Visited American Axle & Manufacturing’s (AAM) Rayong Manufacturing Facility in the Eastern Seaboard Industrial Estate. AAM opened its Thailand operation in 2008. 2010 sales were $2.3 billion. They produce mostly axle systems, but also drivelines, drivetrain and chassis, and other metal-formed products for automotive. The plant is 124,000 square feet and is located in one of Thailand’s many “free zones,” (tax-free). They currently exclusively supply GM’s Thailand operation, but plan on doubling the size of their plant, as they will be supplying Volvo soon. The Auto Alliance Thailand (AAT) manufacturing facility, a joint venture with Mazda, which wouldn’t welcome us for a tour, produces the Ford Fiesta and lightweight trucks for that particular half of the world. I was told that Thailand can’t compete with China’s steel prices, so asked what Thailand’s advantage is over China and India. I was told that it’s Thailand’s supplier base. When GM orders a part, AAM must deliver within 70 minutes.
Wednesday 11 a.m. – I was very interested to tour our first Thai-owned company, the Thai Summit Group, which started in 1977 and makes auto parts for major auto companies. The stamping and injection molding facility makes mainly front and rear bumpers for Mazda and Ford. The plant was impressive and had six 3,000-ton presses and can produce 800,000 bumpers and 6,000 chassis per year. Annual sales are about $10 million. There was a large difference in the atmosphere of the plants from the Western owned companies and this completely Thai run company. They have a basketball court just outside of the main office and President, Mr. Shigeo Sakaki, commented that the workforce there is young and has lots of energy, so they need to have activities for them. It was much more relaxed than Western Digital and American Axle. Young people roamed the grounds like on a college campus. It was nice. They’re obviously making money, but it felt like it would be a nice place to work.
Wednesday 2:30 p.m. – Visited Celestica Thailand, Celestica’s largest location in terms of revenue. They employ 5,630 people and are five minutes from the large port on the Eastern Seaboard and one hour from the airport. They mainly make networking equipment, high-end storage and servers and teleconference equipment (Web cams, phones, digital photo albums, etc.). They see their future in optical device assemblies for the Internet. The Senior Vice President, Mr. Duangtaweesub, was impressive. Thai born, he had studied 30 years ago in Washington State. He started the company, which was bought by Celestica a few years later. He has been running Celestica’s Asia operation ever since.
Thursday 9 a.m. – We were scheduled to visit Magna Automotive and Asia Precision Co. Ltd. in the Amata Industrial Estate, but Magna canceled because they couldn’t get permission from the U.S. office to let us in. Asia Precision was fascinating. It employs about 800 workers (mostly women, Mr. Karoonkornsakul, the CEO noted, because they’re patient, are very good with detail, and there’s little heavy lifting needed) and has over 400 CNC machines, almost all Japanese. They make parts for automotive and camera and their 2011 sales were $30 million, with $40 million expected in 2012. Most of their business comes from the East, but they are a key supplier for Emerson in the U.S., who has asked them to consider building a plant in Mexico, which they are researching now. They are also considering expanding into Indonesia, which the CEO commented would be “the next Thailand,” with production projections of 2 million autos in 2012.
When the automotive crisis hit in 2008/9 they began making rollers for printers. In response to their foreign clients’ needs, they are trying to expand into medical and aerospace, and are facing many of the same hurdles American companies face: the need for skilled employees and regulatory know-how.
Thailand’s Buddhist culture was obvious at Asia Precision. They have weekly company-wide meetings followed by meditation and a singing of their national anthem, and are heavily involved in giving back to their community through projects. They also had the first recycling center we saw, the proceeds of which are donated to the poor. Most of the employees, who are typically age 20-25, are recruited from villages in the north, and once a year they return home for the holidays. They are also very into exercise and health, recently holding a company marathon to raise money for flood victims. The atmosphere of the company was relaxing and the CEO mentioned they have very little employee conflict. It was refreshing to see a company that makes money but has quality of life at the forefront.
Thursday 3 p.m. – Visited the Thai-German Institute, a government training program for industry. This was interesting – I kept wondering why the U.S. isn’t doing something similar, it seemed so obvious. This organization started in 1992 with German funds with the goal of providing high-tech workers to industry. It is now run by Thailand’s Minister of Industry and trains 2000-3000 young people per year, mostly in mold and die technology, but also in automation and machining. It provides workers to the industrial estates in the south, who pay a fee for each worker they hire. Recruiters from training programs like these go to the north in search of competent, bright, high school graduates whom they lure to the south with the promise of decent salaries, subsidized lodgings, and per diems for the duration of training. Then they find them jobs. It appears to be a very win-win system that’s working for Thailand.
Question: Would you consider moving your business or finding suppliers overseas to save money?
The wonderful definitive biography of Steve Jobs by Walter Isaacson spends many pages on the close collaboration between Jobs and his Chief Designer, Jony Ive. Ive was the brains behind the design of the iPod, iPhone and iPad. He and Jobs worked closely since 1997, refining a minimalist approach with an emphasis on rounded rectangles that makes Apple’s products so beautiful and unique.
Great design works so effortlessly that we often ignore it as we enjoy it, while crappy design gets in the way of usage and pleasure.
When I read a blog by Joseph Szczesny of The Detroit Bureau a couple of days ago about Chris Chapman, BMW’s chief designer in the U.S., moving to Hyundai, it struck me as major news. Car design is huge in developing a brand. With the Sonata and Elantra Hyundai has moved into the top rank of auto makers. Snatching BMW’s #1 sounds like a real coup.
One of the primary ideas I’ve gotten from the Steve Jobs story is the importance of putting artistry into your life. Not just your products, not just your work, but your life. I think we all have some talent, a spark, something special and magical that we can access if we focus on it. Maybe it’s our voice that fits perfectly in a choir, or our gardening touch, or the ability to integrate machining capabilities to perform a job perfectly and repeat it.
Pursuing the special talent that makes magic is my goal for 2012. I’m looking for it in writing this blog.
I wish you joy in making your own magic today.
Question: Do you think Mitt Romney can ignite enough voters to beat Barack Obama?