Ford is launching a new Chip Solutions Center in North Texas that will streamline product development, save time and money, and keep American-made electronic parts flowing to assembly plants around the world.
The move is part of a broader program to boost U.S. manufacturing. The new chip center, the fourth in the world and the first outside of Asia, is expected to reduce development times for products by two years by speeding up testing and speeding up the level of design detail made available for adoption in existing products.
Ford, which invested $1 billion in its Michigan operations in 2015, expects the Dallas center to cost $1.4 billion and be fully operational by the end of 2016. The company’s main supplier for powertrains is Renesas Electronics.
The new lab will operate out of a new data center that will provide customers with access to up-to-date tools and training.
“This is a bet on a strong, growing economy in the U.S.,” said Doug VanDagens, Ford’s lead development engineer for propulsion.
Ford’s global leadership ranks reflect the company’s new focus on driving manufacturing innovation. Eight of the 17 Ford executives listed in the top leadership positions — including CEO Mark Fields — are American.
“With programs like Advanced Manufacturing, Ford wants to lead innovation for the future,” VanDagens said. “We’re not talking about creating some finished, more expensive product. This is totally about building the future right here in the U.S.”
Jeff Hermanson, Ford’s chief technology officer, said the company has made great strides in the field of electric vehicle propulsion.
“We’re now on the leading edge of technology in electric vehicles,” he said. “To the point that about 98 percent of our all-electric vehicles are assembled in the U.S. Today, that’s not the case with so many of our traditional vehicle platforms.”
The company expects the Chip Solutions Center to allow it to accelerate production in manufacturing facilities by automating routine tasks such as product design. The Automated Prototyping and Development Facilities in Pittsburgh, Michigan and San Luis Obispo, California, have already helped Ford move toward making products 10 percent cheaper, quicker, and better.
“As we’ve worked with our suppliers and found efficiencies in their own business processes, we can add efficiencies to our own designs in those facilities,” VanDagens said.
U.S. manufacturing accounted for about 14 percent of world manufacturing output in 2015. But for the sector to flourish over the next decade, the U.S. must make gains in higher productivity and greater automation, according to experts.
In May, the Department of Commerce’s Economic Policy Group issued a report that concluded that U.S. manufacturing may be back on the comeback trail.
“It’s not going to be a quick comeback,” said Mark Zandi, a senior economist at Moody’s Analytics. “We’re not going to see a miracle, but our main challenge is how to maintain our status as an industrial powerhouse.”
Brett Hulsey, vice president and chief economist for the non-profit Institute for Supply Management, echoed Zandi’s sense of urgency.
“What we really need to do is to accelerate industrial production,” he said. “Part of that means adding more workers and investing in new technologies that are available, and doing it now before the economy slows down.”