How Not to Reinvent the Wheel

What do the Volkswagen Golf and Beetle and Audi TT have in common?

They all share the same chassis. From the outside, they appear to be very different vehicles, but inside, their platforms are identical.

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In the United States, the Chevrolet Venture, Pontiac Montana, and Oldsmobile Silhouette all use the same power train. Automobile manufacturers have learned over the last century that the capital required to develop a new product is more than even they can bear.

Mass production demands standardized parts, not just within the model, but across the entire industry. By standardizing production of spark plugs, automatic gears, door locks, electronics, and power trains, they have been able to lower production costs and cut development time dramatically, often eliminating testing for many items that have already proved themselves in widespread use.

Volkswagen has this down to such a fine art that they produce only four platforms as the basis for a spectrum of 30 models spanning four international brands. Now ask yourself what you might learn from this.

The automobile industry originally began standardization out of bicycle garages without any deliberate policy. They were using similar components, such as nuts, bolts, light bulbs, and tires. It took a long time before they realized that there were considerable benefits to using subcontractors and began consciously buying outside components. Initially, most of these components were small, low-cost items, such as spark plugs, tires, and starter motors. Standardization really took off when, after World War II, the Japanese had to kick-start their bombed-out manufacturing base. They had little other choice.

The Japanese soon realized that standardization reduced the call on capital, kept work forces to more manageable levels, and still gave them all the control they needed over suppliers.

This leanness became addictive. During the 1970s the Japanese started to standardize their major components such as engines and power trains (the combined engine/ transmission component), not just within the brand, but throughout the Japanese automotive industry. They have even been known to sell some components to competitors, and entry-level vehicles are enjoying the same quality components as their top-of-the-range models.

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