Manufacturers’ Monthly visited Dana Australia’s headquarters and assembly facility to find out how it has managed to stay profitable through the transition of the automotive industry. Syed Shah reports.
DANA was founded in 1904 and currently employs thousands of people in 33 countries across six continents. It specialises in efficiency, performance and sustainability initiatives for powered vehicles and machinery. Listed on the New York Stock exchange, the company has reported sales of more than $7.5 billion in 2016.
Early last year, Dana opened its new Australian headquarters, manufacturing facility, and aftermarket distribution centre in Keysborough, 37 km southeast of Melbourne. The purpose-built 10,000 sqm facility replaced an existing Dana facility in nearby Hallam.
At the new grounds, Dana continues to remanufacture axles for passenger vehicles as well as the commercial vehicle market, and also services a major Australian customer with assembly of front and rear suspension modules for sedans, SUVs and drive shafts.
In the heavy-duty truck space, Dana is a recognised brand for the reliability and durability of their product range. The facilities in Australia assemble drive and steer axles for local truck manufacturers as well as the assembly of heavy duty drive and steering shafts.
In addition, the company manufactures and assembles industrial driveshafts for industrial applications. Dana’s GWB brand has been recognised as the global standard for technical innovation, quality and performance in driveshafts for these applications.
The employees at Dana get together daily prior to the start of operations to go through any production or communication issues to ensure smooth operations through the day. Ercan Ileri, group leader for Dana Australia’s Keysborough facility, explained to Manufacturers’ Monthlythat transparency and traceability was critical on the work floor.
“Communication is key. It may just be about 10-15 minutes, but it is our most important meeting of the day for our operations,” said Ileri.
The Manufacturers’ Monthly team was then taken around the facility through the various assembly processes including the one that produced the drivelines for major customers like Volvo. “We could not produce any more than 35 shafts over two shifts but when we re-imagined our efficiency within our processes, currently we increased it up to over 40 per shift which is well above double,” said Ileri. He also mentioned that all parts are manufactured by Dana in various overseas facilities and they are in full control of the quality standards of their products.
While most of the measuring, cutting and deburring of the shafts and drivetrains are still semi-manual, the move to automated cutting assembly processes is not far off for Dana. “There are some machines within the assembly line that we are exploring to replace with fully automated systems. I have been to Germany to view some of these machines where it requires only three operators from cutting, assembling and balancing. That machine can potentially produce 40 shafts in an hour. But at the end of the day, it really all depends on required volume, efficiency and costs versus output,” he said.
“Should we reach the point where we require a volume increase that befits the purchase of that fully automated machine, then we will consider it because it is good for the business. Otherwise, it is not justifying the return of investment (ROI) at our current required output.”
Because the Australian automotive market has become more niche, the demand has streamlined and businesses like Dana need to be selective when looking towards new technologies. “We must always be looking at new technologies to grow our business, but it is always a case of ‘if we require it, we’ll go for it, if we don’t, then we don’t’,” said Ileri.
Improvements to the assembly plant
Despite the structured and neat look of the assembly plant, Ileri said that there still needs to be adjustments to the layout to maximise the output of the processes on the floor. “If you compare this (Keysborough) facility to the Hallam plant, this place is heaven. We are always looking at better efficiency and productivity on the factory floor,” said Ileri.
In the Remanufacturing of Commercial and Light vehicle area, he explained that while some of the drive heads come assembled, they need to be disassembled due to the different specifications required by the Australian market. “The ones manufactured in the US sometimes come in different ratios and we have to customise it for the Australian customers,” Ileri said.
Moving forward, he said that currently, as with many other parts that Dana usually brings in to disassemble and reassemble, they are looking at purchasing manufacturing equipment to assemble the loose parts in-house directly for the Australian market since it is more practical in terms of cost.
Dana Australia looks after its customers by making sure that they only employ the best qualified mechanics to work within the facility. “We only employ those who are certified to do the specific jobs assigned to them in the various stations – mechanics, welders and so on,” said Ileri.
Welding is an important process in the manufacturing of rear axles. “You have to be 100 per cent accurate in the welds of the parts, otherwise there might be a malfunction later on. We have jigs and drawings and a team that signs off on a check sheet. Should there be an imperfection in the welds later during the quality testing and inspection stage, we might re-work the part again or reject it totally,” said Ileri.
Aftermarket service and keeping manufacturing alive in Australia
Should there be parts (loose or assembled) that are required urgently by a customer, Dana uses the vehicle off-road (VOR) process. Dana guarantees a 48-hour turnaround when a phone call is made. Ileri said that this is because Dana understands that in logistics and delivery, time is money. So, the longer a truck is unable to move, the longer money is being lost.
“It can be any trucker from any company that is out on the road who calls in a mechanic who will then call us and request a certain part. We endeavour to deliver it within 24 hours although we say 48 hours and this quickness really builds on our customers’ continued trust in us,” said Ileri.
Ileri said that Dana is committed to keeping its existing Australian assembly operations within Australia while retaining local jobs. “Our employees know this and are onboard to keeping this ‘keeping it local’ philosophy alive,” Ileri said.
“We came into this new facility to grow Dana further but we’re already thinking of expanding our operations further and are committed to growing Australian manufacturing. Our managing director, Nick Stavrakis is already guiding us through this new phase and are excited to see where the coming months and years take us.”