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Discussion Starter · #1 ·


http://www.askaprice.com/torque-art...roduction_for_Slovakian_Kia_factory&item=2939

Since the first cee’d five-door rolled off the Zilina assembly line in December 2006, manufacturing at Kia’s all-new facility in Slovakia has been setting a series of production records, with more than 24,000 cars made so far this year.

Kia’s original goal was to ramp-up production conservatively, starting with one shift of workers and 5,000 cars a month during the first quarter of 2007 and going on to introduce a second shift to produce a total of 10,000 cars a month from May.

However, the first shift has been operating so efficiently – building up to 617 cee’d a day – that the second shift has been introduced 45 days ahead of schedule. As the second Zilina shift gathers pace towards a 60 cars per hour target, Kia is now planning to manufacture 12,000 cars in March and April, moving up to 14,000 in May.

‘Production at Zilina is progressing really well and vehicle quality is being maintained at the very highest standards,’ commented Jean-Charles Lievens, Senior Vice President Kia Motors Europe. ‘The introduction of the cee’d is bringing about a qualitative revolution for the Kia brand that will change how we are perceived by consumers across Europe.’

Representing an investment by Kia of €1 billion, the facility at Zilina is establishing new benchmarks for vehicle quality and productivity – aiming to manufacture 100 cars per employee per year when fully operational. And it will set new standards for environmental protection. The establishment of this plant is creating 20,000 jobs in the region and Zilina will have an ultimate capacity of 300,000 units annually.

Thanks to some of the world’s most advanced manufacturing techniques, the Zilina plant is ensuring that cee’d is a durable high-quality product and Kia is demonstrating its confidence by giving every cee’d a revolutionary seven-year and 100,000-mile warranty.

The Kia warranty is the best new vehicle warranty ever offered by any car manufacturer in Europe, with five-years’ cover of the entire car and an additional two-years’ cover on the powertrain. It is the clearest corporate statement of Kia’s confidence in the quality, durability and reliability of Kia products made in Europe.

By the end of the year there will be three cee’d body styles to choose from. Production of the cee’d Sports Wagon will begin in August with the cee’d three-door hatch in December 2007.
Wow, a 5 month old line puming out 77 cars/hour. With an annual wage of ~7000 Euros, that's like a labor cost of just 70 Euros/car. Cheaper than building the car in China.
 

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Chery (March): 1096 cars per day, 7700 workers, average wages 100 euro/month; labour costs 23 euro/car

KIA (March): 387 cars per day, how many workers?, average wages 583 euro/month; labour costs according Haters 70 euro/car
 

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Discussion Starter · #3 ·
Chery (March): 1096 cars per day, 7700 workers
Try 13,000. I am not sure how many are factory assemblers, but most of them surely are, since Chery has no R&D.

average wages 100 euro/month
China's current auto wage is like $3/hr. So the monthly wage is ~$500, or 373 Euros. Now even you can see that Chery has a labor cost disadvantage.

Let's say Chery has 10,000 assemblers turning out 400K cars/year, that's 40 cars/worker. Since each worker's annual salary is 4476 Euro, the labor cost per car is 112 Euros. Quite higher than Kia's 70 Euros per car at the moment.

Then how does Chery manage to keep its prices so low? Buy losing money on bait models and using super-cheap parts that other established automakers wouldn't touch, hence Chery's infamous 70% defect rate out of factory gate and the second worst quality in China after Geely. But Chinese buyers don't seem to mind since they are entirely price-driven and don't understand the culture of automobile ownership since they are all first-time buyers.

KIA (March): 387 cars per day
The article says 617 vehicles from single shift.
 

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Discussion Starter · #4 ·
This may come as a shock to Chinese, but Chinese automakers don't enjoy much of a labor cost advantage against Japanse and Korean ultra-efficient auto-assembly lines; this is how Toyota was able to ship out $12,000 cars from Japan where the average auto factory salary is $100K/year.

There is no Chinese price in automobile landscape. What worked for toys and clothing does not work for automobiles and auto-parts.
 

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Real_I_Hate_China said:
this is how Toyota was able to ship out $12,000 cars from Japan where the average auto factory salary is $100K/year.
Let's say they average 200 cars/employee/year, it comes to $500/car, no?

Real_I_Hate_China said:
China's current auto wage is like $3/hr. So the monthly wage is ~$500, or 373 Euros. Now even you can see that Chery has a labor cost disadvantage.
I don't know how they do it, but Chery's salary is much lower than say FAW or SAIC. Numbers I've seen are indeed around $100 euros/month. It sucks for Chery's employees, but that's the way it is for now.
 

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