Commentary on “American Factory”

Oscar 2020: Obamas thrilled at American Factory nomination | Daily Mail  Online

American Factory is a 2019 documentary film directed by Steven Bognar and Julia Reichert, about Chinese company Fuyao’s factory in Moraine, a city near Dayton, Ohio, that occupies Moraine Assembly, a shuttered General Motors plant.   It is the first film produced by Barack and Michelle Obama’s production company. 

I was curious to learn where or how Fuyao Glass obtained its Glass Technology knowhow? Through Google search and reflection on the information obtained, here are some interesting observations:

1. The basic process technology / know-how came from two legacy companies: Saint-Gobain (French) and PPG (USA).

As much as the US and French companies have attempted to invest and globalize outside their national base, Fuyao has done the same by expanding outside of China and investing in the USA.

2. As is the case in most manufacturing sector industries, we see no focus on breakthrough or radical technologies in this movie for legacy business such as automotive glass.

At the end of the movie one can see the emphasis on robotics and automation. Automation is seen as “technology” and the way into the future (with the implied unavoidable diminishing of work force and employment for the factory workers). Paradoxically the theme of the movie is the fight against union workers and union’s stated goal to save their jobs! It is like fighting to serve the soup out of a pot where there is less and less soup left to serve!

Please see our blog post, “Do Americans really miss the unions?”

Process innovation and creating “New Solutions” is the way forward for better employment. Union or no-union would be merely a side show in this inevitable technology growth and migration.However, even legacy knowledge, application and know-how such as that required for current automotive glass would appear sufficient for a Chinese investor to take the risks and make money out of it in the USA.

The financial economics acceptable to the Chinese investor may work only under low wages for work force in USA. Hence the pressure and ultimately the success of Fuyao to keep the labor union out as seen in the movie.

At the same time, the Chinese parent Co. highlights the Worker Union in China under the local political system!

Anyone who believes the “the world is flat” under globalization should re-think such simplification and their enormous impact in public perception.

3. US Government (at the State as well as Federal levels) have failed to manage the global capital investments and transactions and their implications on work force wages even under the “Anti-China” attitude expressed in public by the Trump administration or the Republican led state Govt. in Ohio or the Dem. Senator such as Sherrod Brown of Ohio!

4. UAW has also failed miserably in that their only goal was to unionize the workforce in Fuyao. They did not see the need to train the workers and get them better skilled than the Chinese workers. The Chinese expatriates in the movie would appear to have only hands on experience acquired from their working in their plants in China.

UAW in collaboration with local universities could set up training and resources that empowers the workers with better knowledge and skills.

Such re-training and education on how to survive under globalization could be for all workers – union or non-union. After all such better educated workers would be better customers and future UAW union members?

5. The academic and other research/scientific resources – available in plenty in Ohio and Midwest – had not stepped in to improve the work content, training and quality of the workers.

The movie shows an American supervisor trying to mimic the Chinese drill for the workers in Ohio at the beginning of the shift. While this would seem as a parody at first, such meaningless copying of Chinese and Japanese work place habits are frequently noted in the industries.

It is sad to see the psychological stress of the workers left to believe that they had good paying jobs and good life in the past under GM (the plant which has now closed) and they are now left in a deplorable state of affairs. Better education, training and re-skilling would restore their confidence and the “can-do” attitude of the American spirit.

6. Piles of broken glass in the Chinese plant and the uncontrolled shattering of glass in the Ohio plant would suggest opportunities for process improvement. Such process improvements in glass parts making could also improve the speed and efficiency in handling of glass by robots in their future applications.

7. The emphasis in labor relations has been on the traditional issues of Union Vs. Non-Union fights, “keep the union out” mindset of the management and Chinese owners, “give me a job and good wages” mindset of the workers without challenging themselves to get better and competitive on their own, “state subsidies to foreign investors is the only way to grow new jobs” mindset of the Govt. and politicians, etc. A more comprehensive approach with System Thinking and Transformational Skills may be the real need from all sides?

Sadly the film American Factory does not delve into any of the above issues and hence leaves a dramatic presentation that merely perpetuates the apprehension and anxieties of the public at large! :-( The company formed a joint venture with Saint-Gobain in 1996 with the French firm’s 51 percent stake valued at $15.3 million. Three years later, Cao bought the stake back for $30 million.[6] Fuyao Glass America Inc.[edit]In 2013, Fuyao began looking at establishing a factory presence in the United States, considering several sites in Ohio and Michigan before deciding on the former General Motors Moraine Assembly plant in Moraine, Ohio.[7] Its initial commitment to the factory, which was made public in January 2014, was to buy 1.4 million square feet of the plant from Industrial Realty Group and invest $240 million into an auto glass production facility, which would create 800 jobs.[7] In 2014, it bought a float glass plant in Mount Zion, Illinois. In 2016, it announced an additional $131 million investment to add additional after-market glass lines at the plant, bringing it to 24 production lines. In exchange it received $6.6 million in incentives from JobsOhio. By then, the company planned to produce enough auto glass for 4 million to 5 million automobiles a year,[8] taking advantage of contraction in the U.S. auto market during the Great Recession.[9] By the time the plant entered full-scale production in October 2016, the company had invested $1 billion in the U.S. subsidiary, with long-term plans to grow to 5,000 employees in the United States.[10] As of early 2020, Fuyao has opened additional operating facilities in Greenville, South Carolina and Detroit, Michigan.[11

PPG reaches agreement to sell Mt. Zion float glass manufacturing facility  PITTSBURGH, July 18, 2014 – PPG Industries (NYSE:PPG) today announced that it has reached a definitive agreement to sell substantially all the assets of its Mt. Zion, Illinois, glass manufacturing facility to automotive glass manufacturer Fuyao Glass America Inc. The Mt. Zion facility currently manufactures glass for use in residential and commercial construction markets. Fuyao plans to rebuild and retrofit the facility’s two production lines to manufacture automotive glass. PPG will continue to operate the plant for up to one year, producing SUNGATE® coated glass and clear glass. The production for these products will eventually be shifted to PPG’s other North American float glass manufacturing sites. The sale of the Mt. Zion facility is consistent with the strategic initiative by PPG’s flat glass business to focus on its higher-technology, coated glass capabilities for residential and commercial construction application. “Glass coatings technology remains the engine of our growth and we plan to make incremental technology investments in our facilities to improve our current capacity for better-performing, low-e glass and to expand our overall technical capabilities for newer, more advanced products,” said Richard Beuke, PPG vice president of flat glass.In regard to Mt. Zion facility, Beuke added, “Fuyao has been PPG’s business partner for 13 years and is a well-respected glass manufacturer and fabricator. We look forward to an ongoing collaborative relationship with Fuyao in North America as a PPG technology licensee. The Mt. Zion facility is ideally suited for their automotive glass mission, given its geographic proximity to major automotive manufacturers and history in automotive glass production. ”PPG’s flat glass business unit manufactures high-performing coated glass, tinted and clear float glass primarily for the residential and commercial segments of the construction industry, as well as other specialty glass markets. The Mt. Zion facility was built in 1959 and converted for float glass production in 1978.