chapter 9: high gear

A New Jeep Every Minute

Jason Ryska, plant manager at Jefferson North. Photograph by Christopher Morris/VII for Bloomberg.com

Jason Ryska, the current plant manager at Jefferson North, keeps a baseball bat in his office to remind him of the first time he made contact with the Jeep Grand Cherokee under Fiat (F) management. It was on stage in an amphitheater at Chrysler's design and engineering center in Auburn Hills, shortly after Fiat took control in 2009. Marchionne, the new chief executive officer, handed Louisville Sluggers to Ryska and a gang of Chrysler executives who had survived bankruptcy. He told them to start swinging at the Jeep that was once the pride of the fleet. This wasn't the hot new Grand Cherokee that Ryska builds now. It was the previous model that had been compromised and cost-cut until it was stripped of its dignity and reduced to an "also-ran," as designer Ralph Gilles said. Ryska grabbed the bat and began pounding. It was a corporate catharsis.

"We beat the hell out of that thing," Ryska recalled. "It was symbolic of what we had to do as a company: Destroy everything that we built the company on, that we held in high regard and we thought made us successful. Destroy that in order to start from the ground level and build up."

Ryska, a bespectacled and boyish son of Detroit, landed the plum job of managing Jefferson North about two years later, right after the Grand Cherokee had helped to drive Chrysler back into the black. Unlike Owusu, Ryska's role is not to manage crisis and collapse. He's the man in charge of keeping Chrysler's most profitable product pumping out the doors of Jefferson North every day. "With the responsibility of this plant comes a fair amount of pressure," said Ryska, 43, who grew up along the Detroit River beside steel mills and car factories. "But I still have my hair and it hasn't all turned gray yet."

Photograph by Christopher Morris/VII for Bloomberg.com Close

Photograph by Christopher Morris/VII for Bloomberg.com

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Photograph by Christopher Morris/VII for Bloomberg.com

Reckoning to Revival: Rebuilding the U.S. Auto Industry
Ch. 1
Buckle Up: The Potholes Stay Where They Are
Ch. 2
Off-Road: The SUV's Ride From Peak to Valley
Ch. 3 Recalculating: Failed Talks and an Italian Wedding
Ch. 4 Rearview: Obstacles Closer Than They Appear
Ch. 5 Done Dealership: Collateral Damage to a War Hero
Ch. 6 Idling: Father and Son Live Through Layoffs
Ch. 7 Recall: Insourcing Workers From Detroit
Ch. 8 Trim: Moving the Assembly Line Outside
Ch. 9 High Gear: A New Jeep Every Minute
Ch. 10 Differential: The Divide Over Wages
Ch. 11 Ignition: 'Isn't That What America Is All About?'
Post-Crash Site: Five Scenes of a New Life

Since Ryska arrived in January 2012, he has hired a third crew of workers, increasing employment at the plant to 4,500, from less than 1,400 when Chrysler emerged from bankruptcy. His factory runs 20 hours a day, turning out 1,205 SUVs a day. To keep up with demand, he runs his factory on overtime three Sundays a month. This year, the plant will produce more than 325,000 vehicles, the most since 1999 and five times more than it built in 2009. With estimated pretax profits averaging $10,000 on each Jeep Grand Cherokee that Chrysler sells, Ryska's plant generates more than $3 billion in annual operating profit.

Jeeps have historically fetched high prices and generated exceptional profits because of the strength of a brand synonymous with four-wheel-drive capabilities -- and because SUVs in general are high-margin vehicles. While Toyota may sell more Camry sedans, profit margins are slimmer, which means a standard car factory is not as profitable as an SUV plant. High-end luxury sedans and sports cars such as a Lamborghini generate higher margins, yet they sell in such smaller numbers, so no single factory makes many. That leaves Jefferson North right in the sweet spot of high production and high profit. Adding to profitability is its two-tier wage system, which significantly lowered labor costs, and the new Summit model, with a sticker price that can top $60,000.

With so much potential profit at stake, Ryska's burden is to crank out ever more Jeeps to kick Chrysler's comeback into high gear. "We are pretty much at max capacity," he said. "It's quite a grueling schedule."

He'll take that over the situation he faced in 2009, when he managed a Chrysler metal stamping plant threatened with closure. "It was the first time in my career that I got up in the morning and was concerned if I was going to have a job the next day," he said.

There was an exodus at Chrysler at that time, but Ryska refused to leave. "I come from a blue-collar family. My father retired from Ford (F), my grandfather retired from U.S. Steel," he said. "I always grew up that you had loyalty to a company."

Living through that taught Ryska something about himself: He thrives on being underestimated. "The best part is to take something where somebody says you can't do it. That's a hell of a challenge. I'll take that any day."

Nothing about Ryska's first 15 years at Chrysler prepared him for what he faces now: a growing company. "I spent the first half of my career very much in a cost-cutting company, always downsizing," he said. "Now it's, `How do we keep up with demand?"'

Half the workers and managers at Jefferson North have fewer than three years of experience with Chrysler. And building a Grand Cherokee is a highly complicated process. There are 52,789 different ways to configure all the options on a Grand Cherokee, plus there are 11 colors from which to choose. It takes one and a half days for a Grand Cherokee to snake through the plant s 26.2 miles (42.2 kilometers) of assembly lines, which Ryska, a runner, likes to point out is the length of a marathon.

Video: The Five Hottest Cars Driving Out of Detroit

Another headache is keeping parts, such as engines and dashboards, flowing into the factory from the 785 trucks that arrive at its loading docks each day. Ryska is spending time at his suppliers' factories, breaking bottlenecks on their assembly lines so his plant isn't caught short. "We are increasing our volumes sometimes quicker than the entire supply base can keep up," he said.

As Ryska's factory produces a shiny new Jeep a minute, the car carriers hauling them away drive through some of the most destitute streets of a broken city. Detroit, overwhelmed with $18 billion in debt and intractable unemployment and crime, became the largest municipal bankruptcy in U.S. history when it filed Chapter 9 on July 18. Detroit's homicide rate rose in 2012 to its highest level in 19 years, as 386 people were killed, many in the city's east-side neighborhoods that surround Jefferson North. "I've seen just about everything you can imagine on my way into work: fires, ambulances, police cars, car crashes, burned-out buildings," Ryska said.

"Once you cross the threshold onto the plant, it's absolutely different."

Ryska hopes the difference Jefferson North represents can be an example for Detroit. "We're doing this right here in the middle of all the things the country says is bad," Ryska said. "It's not all bad. This is proof."

Crime crossed the threshold of Jefferson North last year when an employee stabbed a co-worker to death near a loading dock and later took his own life at a park across Jefferson Avenue from the plant. Ryska, only eight months on the job, helped to manage the scene and soothe traumatized workers.

Setbacks, Ryska has learned, provide the greatest lessons. It's like what Chrysler said in its famous Eminem Super Bowl ad: "It's the hottest fires that make the hardest steel."

"We don't talk about bankruptcy every day, but we all went through that experience," Ryska said. "We all felt the same thing. We all got up in the morning and said, `What is it that I have to do to provide for my family?"'

On his key chain, Ryska still carries the keys to the first factory he managed, Chrysler's Twinsburg, Ohio, stamping plant. The factory has been demolished since it closed in 2010. Even though the plant was doomed when Ryska went there in 2007, he convinced workers to transform it from one of Chrysler's worst performers to one of its best. Some of those workers are with him at Jefferson North.

"I kept the keys just as a reminder that you can go into a situation where people have written you off and you can still be successful and you can still turn it around, regardless of what people say about you," he said. "It's kind of a reminder to me of the story of Chrysler in 2009."

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