Thursday, January 23, 2014

Dissecting the iStream Dream

Going through the assigned readings related to Gordon Murray’s innovative iStream production methodology, there seems to be little doubt that the cutting edge manufacturing and design philosophy has positive ramifications for operational effectiveness. A process of producing cars that requires 20% of the space of a conventional factory, reduces capital investment by 80%, and has lower operating overhead with the potential for a streamlined, modular, closer-to-market supply chain – what’s not to like about it? Couple all of that with the legendary, iconic status of Murray himself within the automotive design industry, and it seems to me that we have a revolution in automotive manufacturing, and by extension, in the supply chain, bigger than Henry Ford’s assembly line process for the Model T on our hands. Or do we?

In my opinion, it is extremely telling that it took the better part of a decade and a motorcycle manufacturer (Yamaha) making its first foray into the car market, for Gordon Murray to take his iStream manufacturing concept from the drawing board to the road at a commercial level. One would have thought that more established car manufacturers would be scrambling to adopt this technology to deliver their products to market. And the choice of a two-seater, electric car that looks suspiciously like Daimler’s Smart Fortwo, to deliver the benefits of the iStream manufacturing process to consumers is to me, a rather uninspiring and dreary attempt – for a number of reasons:

Firstly, because the design and choice of power train (electric) has a feel of been-there-seen-that.

Secondly, consumers have yet to make the grand shift to electric cars – the Smart Fortwo, first launched in 1998, has yet to make a profit. Attempts by manufacturers to force the eco-friendly automotive philosophy onto consumers has more often than not concluded in a “disillusioning crash and financial burn”.[1]

Thirdly, consider the market for electric cars: according to a recent article[2], the total number of plug-in electric cars and utility vans worldwide is about 380,000. According to Ward’s research[3], the total number of cars in the world is in excess of 1 billion.

Based on those figures, electric cars represent less than half a percent of the total car population of the world! All these factors combine to lead to the conclusion that the Motiv – the torch-bearer of the iStream manufacturing process that holds so much promise, will be hard pressed to deliver on those promises.

Having an innovative manufacturing process that is proven to deliver unprecedented costs savings, reinvent supply chains for operational effectiveness, and promises to simply revolutionize an industry is not enough. Especially not enough, when you’ve chosen a bland, lackluster product design to deliver and market the message.  I doubt we’ll be seeing Murray’s Motiv in the next Transformers installment.  

[1] 2013 Smart Fortwo Electric Drive.
[2] Top 6 Plug-In Vehicle Adopting Countries.
[3] World Vehicle Population Tops 1 Billion Units.

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