New strategies at GHSP show progress
GRAND HAVEN — GHSP, which once stood for Grand Haven Stamped Products, isn't a stamper anymore, but it's still based in Grand Haven and still involved in vehicle manufacturing, and its new strategies appear to be bringing it out of the recession in a position of strength.
In December, GHSP announced it had produced its one-millionth automotive shifter in China. Late in January, it announced it had signed up $100 million in bookings in new business in 2009, a company record.
Earlier in December, the GHSP plant in Hart was presented with a Green Factory Achievement Award from Honda in recognition of its five-year waste recycling project. The Hart plant produces thousands of automotive shifters annually, using advanced injection molding technologies that produce tons of plastic waste that, before 2005, had been discarded in landfills. Then, GHSP seriously started recycling and has since reduced its landfill-bound waste by 68 percent and disposal costs by 57 percent.
Like many other Michigan manufacturers, 2009 was a year that GHSP would like to put behind it as fast as possible. When the 86-year-old firm, now owned by JSJ Corp. of Grand Haven, had its annual management dinner over the recent holidays, its president and CEO, Paul Doyle, presented each executive with an 2009 MBA degree — from the "School of Hard Knocks."
Sales were down an estimated 30 percent or more, and almost a quarter of its work force was ultimately laid off. New business bookings in 2009 are "a significant increase in our best-ever bookings," said Doyle. The company's previous annual record was $70 million several years ago.
One strategy that’s paying off is its investment in production in China, which began in 2000. Today, GHPS has two wholly owned plants in Shanghai and has been making automotive shifters there since 2005. Its customers in China include Honda, Suzuki, Shanghai General Motors Co. (a GM joint venture) and Beijing Benz-DaimlerChrysler.
In the U.S., where auto production seemed to have fallen off a cliff in the last couple of years, production volumes for 2010 are predicted to be up slightly from 2009. The auto industry supply base did a "great job" of shrinking itself to match production volumes that were below 9 million vehicles, said Doyle. "As this new volume comes up, it's looking like it will be maybe an additional one and a half to two million units for next year, and that will be a blessing to all the suppliers," he said.
Another GHSP strategy is to diversify into other markets: "We can't be dependent on one market and one region," said Doyle. As recently as June 2009, as much as 90 percent of GHSP business still involved passenger cars made by the Big Three and the so-called "Asian domestics," but it is now pushing development of its expertise in electronic and mechatronic controls for a wide variety of surface transportation industries.
Automotive shifters were once purely mechanical linkages from the driver to the transmission, which is how the stamping process became part of the company's identity. GHSP is now moving toward electronic activation, including advanced computing capabilities.
This isn't just about shifting gears. GHSP now has three distinct product lines, including "smart" brushless DC motors that drive pumps that are part of the cooling systems in green vehicles.
Some of the electronic controls are especially relevant to electric and hybrid vehicles, where the engine may no longer provide the power source for vehicle control systems.
“Surface” transportation includes vehicles with military, agriculture and off-road applications.
"We think there is a revolution occurring,” said Doyle, with that change leading from an oil-based propulsion system to electric.
In September, GHSP announced it would integrate its electronic and mechanical operations at the Grand Haven plant. Electronic manufacturing at its plant in Troy will wind down this winter, bringing up to 70 jobs to Grand Haven. The company will retain its engineering, design, test and sales functions at a Troy facility.
GHSP employs about 800 people worldwide, including in China and Mexico, with about 550 to 600 in the U.S.
A major change has already taken place at its facility in Grand Haven.
"We made the decision last year that we were going to — once and for all — exit the stamping business, so we have sold all the presses and moved all the metal processing equipment out of Grand Haven, and we're putting significant investment into reconstruction and reinvention of this facility as an electronic and mechatronic center of excellence," said Doyle.
"The thing we do better than anybody else, as a company, is the integration of mechanical (components) and electronic software and aesthetics, and you can't process those at different locations and expect them to really come together seamlessly," said Doyle.
Despite the push for electricity replacing oil in transportation, Doyle predicts that the internal combustion engine will be around "for another 50 years, easily."
There are "a lot of efficiencies yet to be gained in the internal combustion engine," he said. "We just haven't had the pressure to really (force) those innovations — but as we found out last year, at least in the U.S., when gas hits about $4 a gallon, people are motivated to think in a different way. And that's part of what caused the interest in electric vehicles."
"It's clear that this is going to be an evolving solution, and it's an inevitable outcome, but if people think we're going to wind up all driving electric vehicles in the next three years, that's just a false assumption," he added.