Mr. Burton. Fifty percent of your die work you feel is necessary to be done in-house and about 85 percent you farm out as far as fixtures are concerned?

Mr. KERIGAN. Yes; taking the total program.

Mr. BURTON. Now, we have heard a lot of discussion during these hearings, and we are going to hear some more this afternoon, I am sure, having looked over the coming witnesses, about numerically controlled equipment. Would you just enlighten the committee or comment on the impact of this new technology on the industry and what you might see coming down the pike in the future?

Mr. KERIGAN. Yes, sir; I cannot get too excited, really, about numerically controlled equipment from the standpoint of its effect on the tooland-die industry. Actually, we are all in the research stages of this program. For the most part, we are talking in terms of what is know as the draw die. We are all working in the draw-die area. In a line of dies, you could have five or six dies.

Mr. BURTON. Sir, you leave us novices back on the trail when you talk about a draw-die.

Mr. KERIGAN. All right. The first piece of metal that goes into the press line goes into a draw-die. This draw-die sets the shape of the material. Then we start in the next subsequent operations with the trimming and flanging and piercing operations as it goes down the line and then comes out a finished product.

Now, in the areas beyond this draw-die, we are not concentratingin fact, we do not think the opportunity for savings exists, really, in that area unless we are dealing in standard dies sections or something of that nature. So we are concentrating on the draw-die. Now this has to go all the way back to the clay model. As you know, the clay model is a sculptured part. If you consider the left fender and the right fender in the clay, they really are not exact duplicates. So we have to develop the state of the art, as Mr. Bogart said, and, first of all, develop the software, as you understand the software part of computer operations. We have to develop the processes and the next step, the tapes, developing-well, we are following a system of cards and then moving it to tapes. It is our long-range plan and we have not made it any secret. As early as 1964, in Steel magazine, I reported to the industry exactly what Chrysler's plans were. In talking to members of the industry, we have not held back any information from them at all. We have suggested that in certain types of equipment, knowing that the technology is on the move, if they buy the equipment, at least buy equipment that will accept numerical control attachments. Now, this will require a little less expenditure than it would-in fact, considerably less-than if they have to go out and buy the total piece of equipment 5 years hence. We tell them that we hope that the day will come when we will call them in and tell them we will take their quotations on the basis of not a whole stack of prints-which usually is something like this [indicating a 2-foot stack of papers], that it takes two people to carry out of the office-but we will give them a tape and tell them that they can manufacture this part from the tape.

Mr. BURTON. Mr. Kerigan, as the vice president in charge of this part of your corporation, how much flack have you received from these suppliers on this? Have you had a lot of opposition?

Mr. KERIGAN. Absolutely none. I have yet to have the first complaint. They are all interested. They know it is coming and it represents progress. If they do not stay with the state of the art, regardless of whether it is tools or dies, they are going to be lost out here somewhere. It is coming just as sure as tomorrow.

Mr. BURTON. Thank you, Mr. Kerigan.

Mr. Chairman, that is all I have.

Mr. POTVIN. Mr. Chairman, might we obtain for the record from the witness the Steel magazine article he referred to?

Mr. KERIGAN. Yes, sir.

(The article referred to follows:)

[From Steel, the Metalworking Weekly, Jan. 20, 1964]

STEEL FEATURES-CHRYSLER BUILDS TOMORROW'S STAMPING PLANT TODAY

Picture an auto stamping plant in which. . .

Major press lines can be changed so quickly that they can produce quarter panels in the morning and fenders or hoods in the afternoon.

Dies are Kellered (rough shaped) on numerically controlled machines, using computerized card data compiled directly from clay models. (This technique ultimately will reduce conventional modelmaking.)

Flat parts like doors are turned out on forming machines instead of stamping presses.

That plant of the future is being built today by Chrysler Corp.

It's the company's recently announced 2.5 million sq ft facility in Sterling Township, Mich. The plant will cost an estimated $40 million, the equipment about $80 million. Around 2000 tons of steel will be consumed daily. Employment will be around 3000. Production is slated to begin by mid-1965.

In discussing the plant and its equipment with STEEL, Joseph F. Kerigan, stamping group vice president, asserts: "We are on the edge of a lot of breakthroughs in the stamping field. We want to incorporate some of these improvements into our new plant. We must have them to meet the changing character of the automobile business and to permit an adequate return on our investment." The Sterling plant is designed to utilize the latest techniques that have been developed in metal forming and fabricating. Mr. Kerigan says the plant will not replace any of the firm's stamping capacity. It's part of an over-all expansion program that will add more than 6 million sq ft to Chrysler's production facilities by 1966.

Flexible Facility. To meet an industry wide trend toward more models, Chrysler will install equipment at the Sterling plant that can produce a variety of parts. In 1959, it offered 80 models. It now has 97, and more are planned. As a result, production runs are getting shorter, but the range of parts is broadening. Explains Mr. Kerigan: "The day of the fixed line is about gone. Even the least expensive automobile has become customized. We need adaptable machines and equipment to build cars."

Such capacity is particularly important to Chrysler. Although it is not the biggest producer, it must match its competition model for model and also keep costs competitive.

Equipment Rundown.-The Sterling plant will have 30 major press lines, including 167 presses with 250 tons or more of capacity, and 237 smaller presses. The largest units will have 204 in. beds.

About a third of the lines will be made up of sliding bolster presses. All toggletype presses on all lines will have front to rear sliding bolsters. Many presses will be equipped with automatic clamping and tonnage limiters.

Gravity sheet loaders will be used instead of power feeders. Chrysler has found that the simplified loaders are easier to maintain. They reduce die changeover time. Where possible, die designs will be standardized, so feeders can be placed closer to the press and bolted directly to the die.

Portable side belt conveyers will carry parts from one press to the next. If parts are small, conveyors can be positioned inches away from the die face. Ejection pins will push parts directly onto the conveyor, eliminating mechanical extractors.

The equipment, which is not highly automated, aids flexibility because it reduces die changeover time. Mr. Kerigan estimates it takes an average of 6 hours to complete a die change on major press lines. He expects to slash the time in half at the Sterling plant. The payoff is obvious: Lines are changed as frequently as three times a week.

Specialized Equipment.-With styling trending toward flat surfaces, Mr. Kerigan explains that it's difficult to use conventional draw dies to make such parts. "You really have to prestretch the metal before you can shape it," he says. For that reason, less conventional forming equipment will be installed at Sterling. Chrysler has been investigating Hydroforming, stretch forming, and expanding forming machines for several years. It finds Hydroform equipment can produce small, intricately shaped parts. Stretch forming works well for large, flat panels, like hoods and deck lids.

Expanding machines can make simple flat parts like doors (STEEL, Nov. 26, 1962, p. 139). Asserts Mr. Kerigan. These concepts are more than theories. We know they will work. We have a concentrated program to incorporate this equipment into our new plant."

Looking farther ahead, Mr. Kerigan says Chrysler hopes to develop flanging, trimming, and piercing machines to replace single purpose presses. Ultimately, he thinks even more applications for forming machines will be found in stamping plants because they're potentially more flexible. "Someday, we may have plants that contain no stamping presses as we know them," he declares.

Like most automakers, Chrysler will fabricate some major body sections at the stamping plant. It will install automatic welding lines similar to the ones in operation at its Twinsburg, Ohio, facility.

Chrysler is well pleased with resistance type spot welding machines with multiple heads. "We've licked the quality problem with our firing mechanisms," says Mr. Kerigan. He points out that better than 99 per cent of all the welding heads fire on command.

To provide electrical power for these lines and other operations, Sterling will have an outdoor substation with 48.000 kva capacity. Secondary substations in the plant will have capacity totaling 56,000 kva.

Ultrasonic inspection equipment will be installed to check weld quality. Other ultrasonic units will test the quality of incoming steel. "By using this type of equipment, we think we can help the steel mills provide us with better materials," Mr. Kerigan remarks.

Material Handling.-To improve materials flow, the Sterling plant will have an extra large blank storage area. Drawing compounds developed by Chrysler's Chemical Div. will be applied automatically to steel before blanking. The lubricated blanks can be stored until needed. The plant will have 20 major decoiling and blanking lines. It can store 70,000 tons of steel in coil and blank form. “We plan to install a conveyor system that will let even the biggest parts move directly from press line to the loading dock without handling. This prevents in-process damage and will improve quality," says Mr. Kerigan.

Scrap processing will be improved by using a layout that Mr. Kerigan claims is unusual to this country. Instead of running the main underfloor scrap collection conveyor down the length of the plant, Chrysler is locating it across the center of the plant. Feeder conveyors empty into it from the sides of plant. The layout aids in maintenance and in line changeovers.

The central conveyor feeds into a baler house at the rear of the plant. Two balers will be able to turn out four, 800 lb bundles of scrap per minute.

Tryout Line.-The plant will have one press line solely for die tryoutan innovation that Chrysler regards as a real time-saver.

Efficient die tryout can mean much to the quality and acceptance of new models. "If new die tryout is good, then new models can be built with better parts," points out Mr. Kerigan.

Programing and scheduling will keep check on efficiency. Tryout men will be given a schedule via computer. When the time is up, the next die moves into the press.

Die Handling.-Few stamping plants fully utilize basement space, says Mr. Kerigan. At Sterling, most of the die storage will be beneath the main floor. When a die is pulled from a press, it will be lowered to the basement through floor hatches by cranes. There it will be exchanged for a new die that has been taken from storage. The system simplifies die storage and maintenance, and it frees main floor space for other processing facilities. Two floor elevators will be installed at the ends of the plant to handle the smaller dies.

Tooling Needed.-Chrysler will set up facilities at the plant to produce 40 to 60 per cent of its tooling needs, depending on the size of its program. But Mr. Kerigan emphasizes that because this plant represents additional capacity— the remainder of the new tooling needed will have to be furnished by outside shops.

Chrysler plans to use numerically controlled Kellering machines to rough shape its giant stamping dies. The firm will pick contours and dimensions directly off clay models, run them through a computer, and translate them into punched cards for the Kellers. Results: This will drastically shorten the time between final design and production.

Mr. Kerigan explains that punched cards are preferred over tape because data changes can be made more easily. The setup will be most useful when only slight alterations are made from one model year to the next.

The shop will also incorporate various chemical milling processes for die finishing. It plans to use polystyrene patterns for molds.

Computer Control.-The heart of the Sterling plant will be a giant IBM computer. Its capacity hasn't been determined, but it will be used for everything from diemaking to material and production control. The plant itself will be built and equipped via the computer regulated Critical Path Method. Mr. Kerigan expects the computer will improve plant efficiency 15 to 20 per cent over similarly sized units that aren't as fully computerized.

Here are three areas in which the computer is expected to bring savings: Raw material needs can be determined sooner so steel can be ordered earlierperhaps as soon as diemaking starts. The computer at Sterling will be tied into a data communications network that includes computers at several supplying steel mills. "What really happens is that you let your computer shake hands electronically with the computer at the mill. After they get acquainted, they can almost handle the material flow by themselves," says Mr. Kerigan. The Sterling plant will maintain raw steel and finished part inventories of 20 days or less. By closer scheduling of part shipments to assembly lines, Chrysler expects to make better use of a fleet of trucks-on occasion, they now must rush parts to plants that run short unexpectedly. Every morning the plant manager will have a complete report on the previous day's production of each part. It will show how production stacks up against assembly plant orders for the parts. He'll know what his production position is in relationship to each assembly plant on a day-to-day basis.

The computer will provide daily reports right down to the foreman level. By 2 o'clock each afternoon, every line foreman will have a summary of his performance efficiency for the previous day.

Management Team.-Chrysler already has picked its management team for Sterling. The men will be responsible for building and equipping the plant.

A. James Savage has been named plant manager. He has been running the company's Nine Mile press plant in Detroit. Other team members were selected on the same basis. Explains Mr. Kerigan: "We know these men can do their jobs because they've been doing them in other plants. They don't have to prove themselves. If trouble develops, we know the man isn't the problem-it's something in the process. That way we can back him to the limit."

Mr. SMITH. Mr. Hungate?

Mr. HUNGATE. I wonder, where do you obtain your taillamp lens molds?

Mr. KERIGAN. Well, we do not ourselves manufacture the total taillamp. We buy that in assembly from a supplier. In other words, we give him an order to supply us with the material. However, I can say this for the record, that all of the suppliers to my knowledge for U.S.built automobiles, their tools and molds and so forth are manufactured in the United States.

Mr. HUNGATE. Now, you mentioned some talk about the molds purchased from Canada. You said that was primarily used by the Canadian corporation, is that right?

Mr. KERIGAN. That is right, for Chrysler of Canada.

Mr. HUNGATE. I see. What percentage of your automotive operation would you estimate is in the Detroit area?

Mr. KERIGAN. In the Detroit area? Are you talking in terms of assembly plants or of our total operation?

Mr. HUNGATE. I would think assembly plants.

Mr. KERIGAN. Well, I would guess somewhere in the vicinity of 50 percent.

Mr. HUNGATE. Again, you heard Mr. Bogart's testimony, I presume, relating to previous testimony before the committee that hundreds of independent tool and die shops in the Detroit area have gone out of business in the last 3 years. At least 50 have sold out or closed. If I understood him correctly, he thought that the number of suppliers they found would be in the area of five. What would be your judgment on that question?

Mr. KERIGAN. Well, the die shops that supply us, I believe, also for the most part supply Ford Motor Co. So I would not really question his approximate figure of five. Now, other die shops, when they talk to you in terms of other die shops going out of business, there are many die shops in the Detroit area who do not supply the automotive industry. They may be going out of business. Like any other business, if they cannot survive, we have people going out of business every day. But not in the automotive industry because of what we are doing.

Mr. HUNGATE. Should I understand that the leadtime on a substantial model change is something like 3 years that you need to change these?

Mr. KERIGAN. That is right, roughly.

Mr. HUNGATE. Is there any problem of confidentiality or anything that would lead you to use in-house?

Mr. KERIGAN. Oh, yes; in my statement I used the word "security." That was security insofar as the model is concerned, the style of the car. That is, for the most part, I venture to say that there are many men sitting back of me here, like myself, if you give us 15 minutes in a die shop, we can tell you pretty well what the other fellow's model is going to look like if all his parts are in there.

Mr. HUNGATE. Do you import any tools or dies from Mexico?
Mr. KERIGAN. No.

Mr. HUNGATE. I believe your statement says that none are imported from Europe.

Mr. KERIGAN. Right.

Mr. HUNGATE. I think the same statement was made by Mr. Bogart. I wonder if there is a reason for that.

Mr. KERIGAN. First of all, there is sufficient capacity in this country, and I do not want to stretch out the pipeline, because there is a great requirement for good communications, in many cases on a twice-aweek basis and so forth, and then in the case of engineering changes. If we want to move fast on engineering changes, we have to send people to Europe to handle these. It would be a problem.

There is another matter. We considered at one time the European operation when people told us that they could manufacture dies cheaper. The thought entered our minds that these dies would have to come back by boat and we might find them on the bottom of the Atlantic. So that was just a little too risky.

Mr. HUNGATE. Thank you.

Mr. POTVIN. Did not Chrysler at one time, sir, lose a prototype automobile this way?