Factory in a Box
floatglass.visteon.com
December 14, 1999
Factory in a Box
Most car companies are interested in selling cars. But there's a start-up in California that isn't in the automotive business to sell automobiles. It wants to sell factories that make cars. And it's targeting third world nations.
Every year, the world's major automakers make over 50 million vehicles. Sounds like a pretty impressive number. But there are 6 billion people on the face of the planet, which means most of them are not buying cars or trucks. The reason of course is that most of them live in developing nations, where incomes are low and roads aren't paved. These third world nations impose very high tariffs on imported vehicles, putting the cheapest cars and trucks out of reach of most people. But there's a company called the World Transport Authority in El Cajon, California that thinks it has the solution. Instead of making vehicles to export, it exports factories that make cars. And, according to founder Doug Norman, it uses a very simple process. "It doesn't take any strength. It just takes a semi-skilled person to put every piece of it together."
The vehicle itself is simple and straightforward. It uses a strong unit body made from laminated composites. The surface quality of the body is very good, and it's very durable, too. The World Star, as the vehicle is called, is powered by a Volkswagen, air-cooled engine that can run on gasoline, propane or cooking gas, and can run all day at 65 miles an hour, lugging a ton worth of cargo or up to nine passengers. The rear suspension is a very simple twist beam with rubber padding inside for dampening. The ride is a little stiff, but it can go almost anywhere. In fact, Roger Ward, Former Indy winner and company executive says the World Star is the equivalent of a motorized water buffalo. "We've built this car so tough, it's going to be able to handle the world's roads where not too many of them are paved; and that's where we've really concentrated on."
The World Transport Authority made sure the assembly process is very simple. Each step of the process is written down, so anyone can see how it goes together. The WTA makes all the jigs and fixtures that are needed to make the vehicle, and to ensure it meets all quality standards. It even prints up full-size mock-ups of the wiring harness so workers can make the harnesses on their own, even if they don't know how to read. And all the equipment needed in the plant, such as saws, or drills can be purchased at the local Sears or hardware store. And everything is done to OSHA standards.
Once the factory and all its equipment are assembled it's loaded into an international shipping container and shipped overseas. The factories cost between half a million and a million dollars. But before anyone can buy one, they have to obtain a Master's License to learn how to run it from the World Transport Authority. The cost of the license depends on the size of the country, anywhere from $250,000 to $15 million. But once someone obtains a Master's License, they can train others to get their license. So the World Transport Authority earns money from five areas. First, it sells the Master's License. Then it sells the factory. It gets a fee for ordering and handling all parts and inventory. Then it gets a royalty on every vehicle that's sold. And it also gets a royalty for every additional license that the Master License holders sell. That helps the WTA, but according to Tom Bowers, CEO, it also helps the country where the plant is built. "A dollar turns over four or five times in a local community in the U.S. Overseas, it can turn over as many as 40 times in that community before it leaves, so it's extremely important, this is an economic engine for these countries to have locally, consistent, and really good employment."
The World Star costs about $5,000 to make and sells for $7,000. Not only does that make it more affordable than any new vehicle in most developing nations; it still provides a very good profit margin to the manufacturer. And the people at the WTA feel that they're doing a lot more than just selling car factories. "I've had a wonderful life, and to have the opportunity to help people do for the rest of the world what Henry Ford did for this country, to me is a really important part of my life." Says Ward.
The WTA has sold factories and Master Licenses in the Philippines, Colombia, Venezuela, Equador, Panama and India. It's also in negotiations with 50 other parties. By the way, if you'd like more information on the company, the car or the factory, check out their website at wtaworldstar.com |
