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For This Ford Factory, Betting on Electric Is Paying Off

One Ford plant converted into an electrification center and now makes parts for hybrid and electric vehicles, which allowed it to keep its workers. But the conversion hasn’t come without its challenges.

(TNS) — Just a few years ago, United Auto Workers Local 2280 Chairman Nick Stefani was worried about the future of Ford Motor Co.'s Van Dyke Transmission Plant in Sterling Heights, Mich. Work building transmissions was drying up and some employees there had moved to other plants.

Stefani imagines a grim scenario could have played out: the plant's work gradually falling off, its 1,000 or so workers dwindling to just a few hundred, and finally the union having to fight to keep the plant running beyond the current product cycle.

"As those transmissions went away and the other plants ... got the new model transmissions, we were becoming the dinosaurs," he said. "Were we in trouble? Absolutely, we were in trouble."

But then came a proposal: What if Van Dyke became an electrification center, building components for the hybrid and all-electric vehicles Ford is betting will eventually deliver equal or greater market share and profits than the gas-powered vehicles that defined the Dearborn automaker's first century.

"So we made the agreement. We started moving forward. And ... you see where we are today," said Stefani, 57, of Shelby Township, who started at Van Dyke 28 years ago as a production worker and later became a journeyman machine builder. "It's huge for us."

Now, after a $150 million investment by Ford, the 2 million-square-foot facility has been transformed into the Van Dyke Electric Powertrain Center. Employees here continue to build transmissions even as they ramp up production of electric motors for Ford's new hybrid Maverick pickup and the electric F-150 Lightning that's slated to launch next year. And production of transaxles for the F-150 Lightning is set to begin soon.

Van Dyke's transformation signals how electrification can offer a future for powertrain workers — who largely are concentrated in the industrial Midwest — as organized labor, members of Congress and President Joe Biden's administration look to ensure that unionized U.S. workers are brought along for the transition. Others, however, may not be so lucky.

"The advanced technology we are using at the Van Dyke Electric Powertrain Center is taking us to the next level for Ford's electric future," said John Savona, Ford's vice president of manufacturing and labor affairs, in a statement announcing the name change earlier this year.

For Lisa Cittadino, Van Dyke's plant manager, the plant's new name for the first time in 53 years is "pretty exciting," she said. "Everything is going electric, and we're part of it."

Shifting Gears

At its peak, Van Dyke — which opened in 1968 — employed closer to 1,900 people, according to Stefani, and was churning out some 1.8 million transmissions a year, supplying nearly every front-wheel-drive vehicle in the company. It built six-speeds, eight-speeds and transmissions of different sizes, for internal combustion engine vehicles and eventually for hybrids as well.

The plant supplies transmissions for a range of Ford vehicles, including the Transit, Edge, Escape and the Kuga in Europe. Plant leaders declined to comment on how many transmissions are produced there annually now, but it's well below 2 million.

Van Dyke will continue to build transmissions. But it recently added production of electric motors, the manufacturing process for which The Detroit News observed during a recent plant tour.

Those motors will be used in Maverick's hybrid transmission and in F-150 Lightning's electric transaxle, which Van Dyke also will make. Because F-150 is so much larger, its motor is much bigger than the one used in Maverick.

Compared to a mechanically complex transmission with hundreds of smaller components, electric motors are relatively simple with two main components: rotors and stators. Their assembly involves a highly automated process that nonetheless requires human labor and supervision throughout.

In the rotor area of the plant, robots grab and stack small pieces of metal that will be magnetized later in the process. In full production mode, robots churn out a finished rotor and stator every 75 seconds.

In the stator area, the process begins with stator cores. Each one has a barcode that allows employees to track its progress through the system.

Robots insert paper insulation into the cores. Next, the robots make wires known as hairpins. They're fed through a machine that processes and bends them into the proper shape, before the wires are layered atop each other, inserted into the stator core, then trimmed back and welded together.

"What we do is manufacture individual hairpins, and we weld them all together because at the end of the day, it has to be a complete circuit all the way around the stator," explained area manager Jim Cashen. "So we're recreating a much higher performance motor out of individual hairpins."

A varnish is used to further insulate the stator, and then it's put into an epoxy bath to complete the job. Later, the rotor is installed in the stator, where it spins, generating the power that propels the vehicle.

At full capacity, said Cittadino, the plant will make up to 300,000 electric motors a year.

"This team is very highly capable," she said. "When you're in machining ... you're dealing with a lot of technology. We're training those same people into making rotors and stators. Everyone has a basis of operating machinery and understanding problem-solving and how machines work."

Among those who went through the training process to work in electric motors is Linda Wilbourn of Detroit, a manufacturing technician who's worked at Van Dyke for 28 years. She opted to work in electric motors because she wanted the opportunity to learn something new.

"I think all the years I've been here prepared me to come over here because it's a little bit of everything I've done," she said. Though she acknowledged that working on electrified components is a bit different, she thinks it'll become normal with time.

"I want to be a plus in the process," she said.

Vertical Integration

Where Ford not so long ago was perceived by investors and analysts as being behind the curve on electrification, the Dearborn automaker recently has stepped up its electric ambitions.

It's now fielding its first wave of all-electric vehicles — the Mustang Mach-E and electric versions of its best-selling Transit van and F-150 — and has committed to investing $30 billion in electrification through 2025. And it recently joined its crosstown rivals in agreeing to push for the White House's goal of having zero-emissions vehicles make up between 40 percent and 50 percent of sales by 2030.

As it's leaned more heavily into electrification, the Blue Oval has moved to bring production of some key EV components in-house.

"We're at a point where now there is sufficient scale for us to entertain having greater levels of vertical integration," said Hau Thai-Tang, Ford's chief product platform and operations officer, while announcing a new battery research and development center the automaker is establishing in Romulus.

The automaker also recently announced a joint battery-making venture with South Korean company SK Innovation.

Meanwhile, Ford executives have held up Van Dyke as an example of how the company is navigating the changeover to electrification, leveraging its manufacturing know-how and at the same time shoring up jobs. They've cast what's happening at the plant, and in its other vertical integration efforts, as a key part of Ford's new growth strategy.

"Just think what ( Ford's) scale of manufacturing flexibility can mean for cost competitiveness when vertically integrating EV components," said Lisa Drake, Ford's chief operating officer for North America, during a company presentation for investors in May spelling out Ford's strategy on reducing material costs associated with EVs.

At Van Dyke, she said, "We've reused front-wheel drive, high-volume transmission lines and pivoted to high-volume electric axles. ... We already had the location, the equipment and a very skilled labor force to support the transition into manufacturing EV components, creating a capital efficiency, material cost and time-to-market advantage over others just starting in this space."

Van Dyke's transformation even has made its way onto the radar of Biden, who name-dropped it during his speech at Ford's Rouge Electric Vehicle Center in Dearborn in May.

Elise Holden, 50, of Warren is a 22-year Van Dyke employee. She had the opportunity to meet Biden and deliver a presentation about her plant during his Rouge visit.

Although the changes at the plant have come with challenges, "It's a good thing," she said, "because this is the future."

Preserving Jobs

Ford executives also have cast Van Dyke as an example of how to secure the autoworker jobs that electrification threatens, an issue about which the UAW has long expressed concern.

CEO Jim Farley has spoken often about how EVs, with their more automated manufacturing processes and reduced mechanical complexity, could impact Ford employees, and he's pointed to vertical integration within the company as one solution. Experts say that powertrain assembly is among the areas where the largest impact will be felt.

Asked at a Deutsche Bank event in June about Ford's strategy on sourcing electric powertrain components in-house, Farley used Van Dyke as an example.

"We want to have the future in our hands," he said. "I think we are ambitious to make the motors ourselves this early in the game but it's important, and we see this differentiating from the bill of material, the cost and the quality."

"The other reason," he added, "is to transition our team. These vehicles are more efficient to build and vertical integration is very important for our team members, to make the transition from making transmissions and ICE engines over to making these components."

Stefani said he had the chance to speak one-on-one with Farley about the issue of jobs and the need to find ways to preserve them during a recent visit the CEO made to the plant.

"For Van Dyke, we're going to do well. For other facilities, it's not going to be good," Stefani said. "And we as a union don't only recognize it, the company recognizes it."

Already, for example, the company came to an agreement with the UAW to shutter its Romeo Engine Plant, though workers there had an opportunity to transfer to Van Dyke.

Meanwhile, Van Dyke employees as well as plant and union leaders say the conversion to an electric powertrain center has not been without challenges. Early on, many employees were anxious, said Stefani. And many of the processes being introduced in the plant are brand new to the workforce there — but the employees, many of whom are highly experienced, have risen to the challenge, plant leaders said.

"When I say this is the place to bring in new work, this is the place. The workforce delivers every time," said Cittadino. "It's an absolute challenge, and there's a lot we don't know. But there's no other team that's going to get through that like we are."

In the coming months, the plant will ramp up for Maverick and F-150 Lightning — and early signs indicate demand will be strong. Already, Maverick has gotten some 80,000 non-binding reservations, while F-150 Lightning has gotten 120,000, a number that company executives say has far exceeded their expectations.

The Van Dyke team is ready.

"Once we get everything lined up," said Stefani, "we're going to go gangbusters in there."

(c)2021 The Detroit News. Distributed by Tribune Content Agency, LLC.

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