updated 6/2/2005 8:46:14 PM ET 2005-06-03T00:46:14

DaimlerChrysler has made giant strides toward a sustainable improvement in the productivity of its North American Chrysler division, according to one of the automotive industry's most closely watched surveys.

Harbour Consulting said Chrysler had raised the efficiency of its plants including assembly lines, stamping operations and engine and transmission facilities at a higher rate over the past three years than any other carmaker.

Nevertheless, Toyota Motor remains the most productive manufacturer, giving it a cost advantage of between $350-$500 per vehicle over Chrysler and the other two Detroit-based carmakers, General Motors and Ford Motor.

Ron Harbour, Harbour's president, said Toyota had created a virtuous circle, with low costs allowing it to add improvements to its vehicles, which other manufacturers could not match. Toyota took the attitude, he added, that "we may be on top, but we've got to act like we're on the bottom".

Mr. Harbour said new models heightened the importance of flexible manufacturing: "Every company has to have the ability to quickly and inexpensively change the mix."

The survey points to a narrowing gap in the time taken by the most and least efficient manufacturers to build a vehicle, ranging from 27.9 hours at Toyota to just under 37 hours at Ford.

Chrysler "is not perfect by any means, but it's starting to show", Mr. Harbour said, referring to the contribution of its German partner, Daimler-Benz, with which it merged in 1998.

Mr. Harbour singled out Dieter Zetsche, Chrysler's chief executive for the past three years. "He didn't just come in there and walk over people. He's been able to mix the best of both worlds."

According to Mr. Harbour, Chrysler is encouraging parts of its business to work as a team. It was no longer good enough for the purchasing department to bring down costs if lower-quality components caused disruptions on the assembly line.

The survey said North America's most efficient plant last year was a General Motors assembly line at Oshawa, east of Toronto, which builds Chevrolet Impala and Monte Carlo sedans.

© The Financial Times Ltd 2013. "FT" and "Financial Times" are trademarks of the Financial Times.


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