Innovative production of an innovative car
Plant built out in the open countryside
Extensive environmental protection requirements observed
“Critics of the smart project had doubted whether we would be able to equip such an innovative car with a length of just 2.5 meters with a convincing package of safety features. They were taught otherwise and today will appreciate that we opted for a completely new approach in production as well – to produce a car that is both inexpensive and profitable,” said the then President of the Supervisory Board of Micro Compact Car AG, Jürgen Hubbert, in 1997 on the occasion of the inauguration of the smart plant in Hambach, France. The managing director of MCC France SAS and first plant manager of the new smartville production facility, Harald Bölstler, added: “The smartville industrial park is more than just a new car factory. It is the result of successful cooperation between MCC and its partners.”
Nothing significant has changed to this day. Seven system partners are still supplying their parts directly to the line in the assembly factory which is laid out in the form of a plus sign. In part, they even install their prefabricated modules into the smart themselves. Time and flexibility, just-in-time supplies and minimized delivery periods at all levels rank among the factors which have remained exemplary to this day. In this facility, transportation and logistics costs are reduced to a minimum so that the smart city coupe, which was renamed smart fortwo in 2004, is completed in less than five hours.
On September 14, 1994, a group of experts arrived in Hambach, looking for a site for an industrial project. Only four days later, an industrial site named Europôle de Sarreguemines was introduced to the MCC executives, Christoph Baubin, Hans Jürg Schär and Johann Tomforde. The subsequent steps were taken unusually smoothly. In an unbureaucratic approach, the MCC’s wishes for special preparations of the site and infrastructural measures including the supply of electricity, gas and water were fulfilled. At the time, the MCC planners specially appreciated the observance of agreed timeframes by all the French administrative panels involved.
On December 7, 1994, Micro Compact Car AG (MCC) founded in March and the French district administration responsible for the town of Hambach in Lorraine signed a Memorandum of Understanding on the location that had been selected. Today the company is called smart GmbH and a wholly owned affiliate of DaimlerChrysler AG. As early as December 20, 1994, the Memorandum of Understanding was followed by a contract between the two partners. Production of the smart in Hambach was planned according to novel principles, and the resulting plant for the large-scale production of automobiles was to attract worldwide attention in subsequent years.
The decision in favor of Hambach had been made after the scrupulous assessment of over 70 potential locations, and it is seen as a clear commitment to Europe as a location of production. Situated in central Europe and close to the German border, smartville is connected to international traffic arteries. It lies on the A4 motorway from Strasbourg to Paris as well as on a railway line. What’s more, the Sarreguemines region offered a large reservoir of skilled labor most of whom were bilingual. It was possible to introduce flexible working hours at the Hambach location. Hence the lower labor costs in France as compared to Germany and Switzerland were far from being the main reason for the choice of location.
A major criterion was the fact that Lorraine, its industry being engaged in far-reaching restructuring, was making great efforts in attracting new industries. And finally, Hambach was located in the structurally vulnerable coal-mining region of France. Those involved succeeded in winning over the state-owned company SOFIREM as a partner. This company had the task of promoting such regions, and in Hambach, SOFIREM was instrumental in integrating smartville in the industrial landscape of Lorraine, establishing valuable business contacts at regional and national levels.
Closely networked industrial complex
The greatest challenge facing the MCC production and factory planning team from Daimler-Benz at the Hambach location at the time was the development of a networked form of industrial complex at the request of MCC Chief Engineer Tomforde. Like the product, this complex had to have a modular structure for production processes which were organized as efficiently as possible. After plans of a U or L shape as layout principle for the assembly line had been discarded, the engineers came up with the idea of subdividing the line into four sections with a joint center and a full-length “pearl-string” assembly line. The idea of the assembly plus sign was born, which optimally met the different requirements of logistics and assembly. In simplified terms, the tasks set out below were assigned to the four branches:
Integration of the cockpit in the steel body immediately after the application of powder-based coating
Technical work underneath the car including the integration of the drive system (“wedding”)
Cladding of the car with body panels, doors and glazing
Installation of the seats, accessories and wheels, plus finish and final inspection.
This structure takes up little space, and the maximum distance between the docking point for the suppliers’ trucks and the assembly line is ten meters. It also means that the assembly sectors are independent of each other. As a result, small buffer zones were established which in the event of disturbance prevent the assembly line from coming to a complete standstill.
An additional building serves as product integration and preparation center. It is located outside the assembly complex and links product development in Germany with the system partners and assembly in Hambach. South of the complex, a test track for pre-production trials and quality assurance was built; here many different road surfaces for suspension tuning tests are integrated on a length of 1.5 kilometers. The smart communications center was built in full view of the near-by A4 motorway. Its task is to inform the public about the smart and the smart culture. It also serves as a venue for conferences and conventions as well as for major regional events.
Here are some figures to illustrate the networked approach in smartville: an MCC workforce of only around 1,000 for all corporate functions points to the high level of external capacity. When you add the system partners’ staff, more than 2,000 people are employed here – under extreme conditions for 126 hours in four shifts per week. They are able to produce up to 200,000 cars annually. Each car runs through a total of 140 assembly steps in just four-and-a-half hours – an absolute benchmark in a European comparison.
Some 300 companies were involved in the construction of smartville from June 1995. Of these, 90 percent were French, seven percent German and three percent from the Benelux countries. Of the French companies, 55 percent had their headquarters in Lorraine, 18.5 percent in Alsace and 16.5 percent in other regions of France.
Well-thought-out financing scheme
Construction of the new production facilities in Hambach required an innovative financing concept. In his capacity as MCC director, Baubin time and again came up with new ways of helping the young company onto its feet. The total investment did, after all, amount to some 2.8 billion French Francs. Of this total, some 1.5 billion Francs or 53 percent was contributed by MCC and 1.3 billion Francs by the system partners. The largest investor among the local partners was the internationally acting US-Canadian Magna Group which produces the body-in-white (Tridion safety cell) of the smart. Second place was occupied by Dynamit Nobel, responsible for the production of all plastic bodywork and attachment parts – the body panels. And the third-largest investor was Messrs. Eisenmann, responsible for surface coating and paintwork. Complementing these investments in the Hambach industrial park, system partners invested additional funds, estimated at over one billion Francs, in ancillary activities.
Together with several hundred million Swiss Francs invested by the sales partners of MCC in the establishment of European sales outlets, as well as some 700 million Deutschmarks spent on development and tools in 1994, the total project volume including the system partners’ investments amounted to some eight billion French Francs at the time production was started in 1997.
The development costs incurred by the different smart versions at MCC were financed from the equity and funds of partners and third parties. The amounts invested in the Hambach industrial park by MCC and its system partners came in part from a European banking consortium and in part from investment subsidies granted by central and regional French authorities within the framework of EU regulations.
In this respect, the European Commission had stipulated on July 30, 1996 that the subsidies must not exceed the maximum defined for the region of Lorraine, namely 17 percent of the investment that is eligible for promotion. The effective maximum of some 450 million Francs was invested because the new project did not cause any shifts in the competitive conditions in Europe – production of the smart created a new market segment. In addition, the high investment in environmental protection and especially in the project’s host of innovations was crucial in securing the subsidies. According to experts, the phenomenon of the smart was to provide substantial stimuli for strengthening the international competitiveness of the European motor industry.
The bank funds were paid out in accordance with a leasing concept that was supported by two groups of banks. One was headed by the French Crédit Commercial de France bank, the other by the German Morgan Grenfell Luxemburg bank. Together they formed a Groupement d'Intérêt which itself acted as lessor. Since mid-1998, MCC and the system partners participating in the leasing concept have been paying biannual leasing fees for the use of the industrial park.
Close network of system partners
Through synergies of the expertise and creativity of all the partners involved, the competitiveness of the joint project was to be strengthened. This was the starting position for the cooperation of MCC with its system partners in 1994. In the course of time, this developed into the “smart alliance” with a much-acclaimed cooperation codex. The latter underlines the joint responsibility and goals of all seven system partners at the Hambach location.
Magna International produces the Tridion safety cell of the smart. Eisenmann Surtema operates the innovative paint shop, an ecologically compatible powder coating system suitable for large-scale production – and the first of its kind on a global scale at the time of the production startup. VDO, a company of the Mannesmann Group, is responsible for the production and installation of the cockpit module. The Krupp-Hoesch Automotive Group locally assembles the rear-axle drive unit, and Bosch does the same with the front module. Dynamit Nobel locally produces the body panels and other outer-skin parts, and Ymos contributes the doors and tailgate modules.
Equally integrated in the cooperation model but not located in Hambach are the system partners for the smart drive and suspension: the Berlin plant of Mercedes-Benz supplies the turbocharged three-cylinder engines and the Hamburg plant of Mercedes-Benz the axles. In this way, the new city coupes of MCC France SAS were completed with just ten direct suppliers of sub-systems.
But MCC consistently pursued new routes not only in the development and production of the smart. In close coordination with the operating companies, a logistic system was also established and accommodated in smartville. The Rhenus logistics and haulage company assumed responsibility for parts deliveries to the assembly line, TNT for the supply with parts and accessories, Panopa for the control of the means of transport and Mosolf for the delivery of customer cars.
The partnership model operated in Hambach is the systematic further development of the conventional producer/supplier relationship. In this new setup, the motor manufacturer acts as modular-systems integrator, process manager and producer with overall responsibility. Every systems partner in turn assumes more comprehensive responsibility. This advanced system generates above-average motivation among partners who contribute to the economically viable implementation of joint corporate targets with their own innovative approaches.
All stages of the product lifecycle, starting with the development of individual smart components via the construction of the industrial park in Hambach through to the use and recycling of the smart, are integrated in a strictly ecological concept. Here again, Tomforde promoted a holistic and ecologically sound approach to be adopted by the construction committee. For the industrial park in Hambach, an unprecedented model of ecological compatibility was implemented. All production materials had to be compared against the black list of banned, i.e. environmentally harmful materials. All buildings are free of formaldehyde and fluorocarbons. The façade cladding is made of Trespa, a raw material produced largely from rapidly growing European trees. The planners even distinguished between wastewater from the buildings’ rain runnels and the wastewater from road and car-park drainage systems: wastewater from the roofs is collected in reservoirs for fire-extinguishing water. All other wastewater is channeled through oil separators, treated in reservoirs and reused.
Environmental protection writ large
A central biological purification plant reflecting the state of the art cleans all sanitary and industrial wastewater. The plant uses bio-membranes according to the BioSep process, a highly flexible recycling method that was applied in France for the first time. The purified wastewater is used for watering the green spaces as well as for process cooling.
The chassis of the two-seater smart is completely coated with powder-based paint. This economically efficient and environment-friendly paint method was applied throughout the paint process here in Hambach for the first time in the motor industry. Over and beyond its high level of environmental compatibility, the method stands out for its qualitatively advanced coat although the paint layer is thinner than that achieved with conventional paint technologies. What’s more, no solvents are emitted and no hazardous waste such as paint sludge is produced. The overall process incorporates a zinc-phosphating step without passivation – which means that it is a lead- and cadmium-free process. The strict implementation of ecological goals is also reflected by the recovery and reuse of excess materials such as the so-called overspray powder.
In the implementation of the energy concept at smartville in Hambach, Lorraine, top priority was accorded to an energy-savings policy right from the start, from the effective sound and heat insulation of the building’s facades through to the systematic implementation of holistic heat recovery concepts. The waste heat from the injection-molding shop and the waste air from the paint shop, for instance, are channeled through rotary heat recovery systems and air-to-air heat exchangers. The extent to which waste heat is utilized here is unique, and it means that cooling towers can be dispensed with; ultimately, this results in cost cuts and reduces the strain on resources. The power plant of smartville, consisting of heat plant and block power station, also represents the state of the art. The combustion of natural gas instead of conventional fuels alone causes lower pollutant emissions. The utilization of waste heat goes a long way towards raising the degree of efficiency.
The harmonious integration of the industrial park in the gently rolling hills of Lorraine is ensured by an ecological green-space concept. Its major characteristics are flowing transitions between factory premises and the neighboring villages and woodlands. This is why there are not only meadows and trees lining the roads but also orchards on the premises. A pond with aquatic and foliage plants provides for the ecological balance, as do the extinguishing-water reservoirs which equally function as biotopes.
Environmental protection activities formed a fixed element of smart development right from the start. MCC was the first motor manufacturer to incorporate an environment management system with certification in accordance with the DIN EN ISO 14001 norm in its specification docket as early as 1994. In fact, the very first smart city coupe already incorporated a high proportion of recycled materials used for visible exterior and interior surfaces and even for highly stressed components. Natural fibers are used to reinforce the underfloor cover. So-called single-material systems combine with standardized connecting elements to ensure the exemplary recyclability of the smart and impressively add to its innovative potential.
The modular structure of the smart is also a guarantor for its economically efficient dismantling at the end of its lifecycle. This was a precondition for closed material cycles. In keeping with corporate philosophy, the company thus assumed ecological product responsibility to an extent that was unprecedented. With its dynamic environment management system which is subject to continuous improvement, the new smart brand sets a milestone in environmentally compatible individual mobility.