To build a totally new car, General Motors is going to begin by building a totally new company. Its Saturn Corp. is going to be a great experiment for the American industrial economy.
The people who run GM, it seems, finally lost their tempers after all these years of being needled and chided for their inability to compete with the Japanese. They got fed up with the figures showing that labor productivity in their plants was a third lower than in the Japanese factories. They understood that, if GM was to keep selling American- made cars, it was going to have to make them in radically different ways. That's what its new subsidiary, the Saturn Corp., is going to represent.
Traditionally the American automobile industry achieved high productivity trough very long producifully in the 1950s and 1960s, when the rate of innovation was low. But that era ended with the 1970s. Success had made GM vulnerable. It had turned into a gigantic organization with its own entrenched habits and rigidities. New ideas were always introduced in the shadow of old habits. That's why GM is now going to create a wholly new company, outside the established organization.
As an intermediate step, GM has entered a joint venture with Toyota that, under Toyota's direction, is now producing cars in Fremont, Calif. GM's chief interest there is to see whether Japanese methods of management and labor relations can work well with American managers and American production workers who belong to an American union. So far, although the operation is still in an early stage, it is going well. GM evidently feels that it is ready for the second, more dramatic step.
The Saturn project is going to tell this country a lot about industrial innovation. I is a declaration that sometimes you can't change the product without changing the structure of the team of people who make it. Sometimes it's necessary to change the ways in which those people look at themselves, and at each other. In the Saturn plants, GM will push for labor productivity of a wholly different magnitude than any ever achieved in American auto manufacturing. That can't be done with the traditional, almost military structure of the factory work force with all its gradations of rank. Perhaps it can't be done with the traditional adversary relations between management and labor. Saturn's workers will belong to the union, but the contract and the work rules will evidently be quite different from those governing GM's older plants.
It's a risky venture. The outcome may depend in the end on things that GM can't control -- like the exchange rate of the dollar. But it is heartening that this immensely important American company, hard pressed for more than a decade by its competitors overseas, is no longer on the defensive.