'Phase 3': Michigan manufacturing begins methodical restart
Auburn Hills — Monday was a dress rehearsal for automotive suppliers and other manufacturers across the state as employees began returning to work at places like Mahindra Automotive North America following a seven-week shutdown because of the coronavirus pandemic.
"We are going through every single function on every possible path before we let people come back," said Matt Pearson, head of prototype services in North America for the India-based automaker, which recalled a small crew to test safety protocols.
Hundreds of thousands of manufacturing workers across Michigan are returning to work this week for the third phase of Gov. Gretchen Whitmer's plan to re-engage the state economy as COVID-19 cases continue to fall. Detroit's three automakers won't begin making vehicles until next week, but their suppliers and other manufacturers now are reopening facilities — albeit slowly.
"There's a lot of moving pieces before they produce parts," said John Walsh, CEO of the Michigan Manufacturers Association. "There's a lot of warm-up work with getting employees accustomed to what the new world might look like for a bit and then actually beginning production. It's going to take time."
Mahindra expects its 120-person manufacturing team will return for the real show next week. Even then, it will be a gradual ramp-up to producing up to 25 of its Roxor off-road vehicles per day. Safety plans will be re-calibrated as often as needed. And employees, who are returning to work even as the coronavirus poses a continued threat, will be given time to adjust to a new normal of wearing face masks, maintaining distance from fellow workers and daily health screenings.
Manufacturing represents 19% of the economy for the state that put America on wheels. Before Monday, less than 5% of business activity had been considered "essential." Roughly 622,700 Michiganians worked in manufacturing in March, the U.S. Bureau of Labor Statistics estimates, and at least half were sidelined because of executive orders limiting commercial activity, according to the state manufacturing association.
Some companies had expected they would not be able to resume until May 18 with the Detroit automakers. The allowance starting Monday had some, including Troy-based Precision Global Systems, hustling to prepare, said Lisa Young, the company's sales and marketing manger. The Tier 1 and 2 auto supplier that offers derusting, machining and other services called back 42 of about 100 employees Monday to resume some production after spending much of Friday ensuring new safety protocols were in place.
"It does take a little bit of time to get things started up, and it's not just a push of a button," Young said. "We made it work. It was a quick response."
Precision began limited production on Monday and intends to return a second shift next week. Other manufacturers are recalling their workers in phases, as well.
“We don’t want to jump in right away with everybody back and then things go haywire," said Trent DeSenglau, United Auto Workers Local 155 chairman for Detroit-based American Axle & Manufacturing Holdings Inc.'s Fraser plant making transmission components, shafts, gears and other metal parts for the auto industry. "They are doing a measured approach, which is what we asked them to do."
American Axle recalled at the Macomb County plant one shift of three for the week starting at 6:45 a.m. Monday, DeSenglau said. A tent outside had workers drive through to get their temperatures checked and pick up masks and other protective equipment before entering the facility. The new measures inside the plant, including hand sanitizing stations, helped ease some of the workers' concerns.
American Axle declined to comment. But during its earnings call on Friday, the company said it expects to resume production in phases starting in mid-May and going into June. Other companies, including Nexteer Automotive in Saginaw and Ontario-based Magna International Inc., also resumed manufacturing Monday. Others, such as seating manufacturer Southfield-based Lear Corp., are holding off until next week.
Ramp up for auto suppliers even could extend into July, said Dan Kennedy, executive director of sales for Illinois-based Flex-N-Gate, which makes metals, plastics and other parts in Detroit, Livonia, Grand Rapids and elsewhere. The timing will align with its automaker customers.
"As they ramp up," Kennedy said, "we will ramp up."
Engineers at BorgWarner Inc.'s propulsion technical center in Auburn Hills are anticipating long workdays ahead to catch up orders from global clients and sort out supply bottlenecks.
"We're having issues with (our) suppliers that are still closed, so that's going to lead to some supply-chain chokepoints," said Matt Belt, a senior validation engineer with BorgWarner who returned Monday with about 50 employees to the technical center.
The components and parts supplier is gradually phasing its workforce and production as it navigates differing government directives across its U.S. footprint. Plants in Livonia and Cadillac began a staggered restart Monday. In the technical center, small crews were building parts prototypes and validating transfer cases from a plant in South Carolina that recently resumed after a tornado damaged the facility.
Liquidity is posing a challenge to suppliers as pre-shutdown payments dry up and they purchase materials they need to restart, said Steve Hilfinger, who represents automotive suppliers at law firm Foley & Lardner's Detroit office. Some suppliers are not paid until 60 days after delivering an order.
"I think as suppliers are being asked to ramp back up and purchase raw materials and supplies," Hilfinger said, "this is going to become a very pressing issue in very short order."
Flex-N-Gate began opening its industrial facilities in Michigan, turning on large injection molding machines and presses and recalling workers. Those efforts will continue at different facilities late into the week.
Employees will get their temperatures checked and fill out a questionnaire about travel and if they are experiencing symptoms. If they are, they may be sent home or quarantined in a separate room until they can get a ride. Those able to enter the building will receive and must wear a face mask.
Management also will go "page by page" with the workers through the company's restart "playbook," Kennedy said, that discusses the new protocols including social distancing and wiping down work stations before and after their shifts.
"It's to make sure they understand it, they agree with it, and that it makes sense to you," he said. "We need to not only ensure that, but that we believe (in) each other to do this in the right way."
After being away from the job for weeks, employees also will get a refresher on ensuring the production of quality parts under new safety measures. As that happens, the company will resume production based on orders from the automakers, which themselves initially will start with fewer shifts and at slower production rates.
"The last thing anyone wants is to start-stop, start-stop," Kennedy said. "They are big, complex monsters. Once they get going, you don't want to stop. So, everyone is taking a smart, thoughtful and logistical manner."
Pearson of Mahindra has developed ever-evolving protocols based on Occupational Health and Safety Administration guidelines, conversations with other manufacturers, and feedback from employees. But the automaker says it is being even more cautious in its approach.
Employees must complete contact tracing forms and go through a temperature check each time they enter the building. Anyone with a temperature higher than 99.1 degrees Fahrenheit will be sent home, even though 100.1 is the standard.
Pearson has divided buildings into "zones" into which employees are confined. Necessary meetings or handoffs will happen in neutral areas that are regularly sanitized. Foot traffic will flow in one direction.
The automaker will provide employees with personal protective equipment. During the production hiatus, Mahindra has made face masks and face shields as well as aerosol boxes that protect healthcare workers when they are caring for intubated COVID-patients.
Plant leaders understand that workers may feel stress about returning and learning to adhere to a new way of working: "So we're starting super conservative," Pearson said. "We can loosen it back up to the actual plan we have, once we know they're comfortable."