Everything either grows or dies. As The Big Two Point Five face the New Year, they’d do well to remember this. All the talk about “market share stabilization,” “matching production to demand,” and “right-sizing” is merely an attempt to obscure the simple fact that they’re dying. I know: that’s a pretty depressing sentiment for automakers still staggering about with an SUV-sized hangover. But death is a normal part of life; a precursor to rebirth. As 2006 dies, 2007 beckons. Here’s a guide to what Detroit faces– must face– in the year ahead.
This is the year that Toyota will supplant Ford as America’s Number Two automaker and replace General Motors as the world’s Number One. These two milestones will provide incontrovertible proof that The Big Two Point Five’s day is over (at least for now). The damage flowing from that increasingly obvious fact will be both subtle and, ultimately, devastating. For one thing, the best and brightest have a natural aversion to working on a sinking ship. BMW, Mercedes, Honda, Toyota and Hyundai will continue to cherry pick the industry’s top management, designers, engineers, production experts and marketers. The little discussed Detroit brain drain will exact a heavy toll.
Secondly, as Mr. Neundorf has written, the rearranging of America’s automotive pantheon will end the average consumer’s ignorance of Detroit’s distress. The media buzzards have been circling The Big Two Point Five for some time, refraining from swooping down because of their collective ignorance, [misplaced] respect and simple disinterest. Once Toyota punts Ford, GM and Chrysler down the sales ladder, the 2.5’s anguish will become carrion feeder catnip. How did the foreigners kick America’s ass again? What does it mean for our country’s industrial base? Although reporters will focus on turnarounds and comebacks– at least initially– the cumulative effect will corrode consumer confidence.
This is also the year that Detroit must finally shuck the union straightjacket– and won’t. Analysts who predict that the United Auto Workers’ (UAW) will come to the negotiating table with “a new sense of realism” (or some such set of code words indicating a supposed readiness to take a hit for the team) will be proven wrong. Once again, there will be some kind of media-friendly slight-of-hand. Last year, GM’s workers “gave up” a $1 an hour wage hike– which actually went straight to their health care compensation. They also “gave back” health care benefits in exchange for a not-as-well-publicized $3b health care VEBA. This is the new template for Detroit labor relations.
By topping-up their coffers, GM and Ford have virtually guaranteed a continuation of union intransigence. In fact, management happy talk about incipient turnarounds makes it highly unlikely that they’ll do the only thing they can do to wrest control of their companies back from the UAW: face down a UAW strike. Wagoner (GM) and Mulally (Ford) have a long history of playing ball with the unions. They’re less likely to exercise the nuclear option against the UAW than the US is against the UAE. Chrysler’s German owners are also strike-aversive; what with the need to keep the company solvent enough to sell. So it’ll be [less and less] business as usual.
In ’07, The Big Two Point Five will all feel the cash burn. If the economy slows down or gas prices go way up, it’ll be a fully-fledged conflagration. Meanwhile and in any case, the biggest threat to their existence is the same one that’s been nibbling away at them for the last three decades: new and/or improved products. We’ve already written about the new Toyota Tundra’s impact on The Big Two Point Five’s mission critical pickup truck margins. The transplants are also set to launch new or improved cars, crossovers and hybrids, and refreshes aplenty. The gap between the Big 2.5’s products and those of their competitors’ is not likely to narrow significantly this year.
Once again, the only real hope for The Big Two Point Five is cataclysmic change. Given their deep pockets, I don’t think Ford or Chrysler will file in ‘07, but there is a chance that circumstances (and their own ongoing incompetence) will force GM to face the inevitable. It could come from any number of different angles: a supplier “run on the bank,” a severe economic downturn, a tipping point-style loss of market share, a UAW strike, SEC criminal charges leading to chaos, a combination of these factors or something unexpected. If GM goes down, the ripple effect on suppliers will drag Ford under, and then Chrysler.
For The Big Two Point Five, ’07 will be a year much like the last, typified by denial, obfuscation and compromise. TTAC will be here chronicling the story. Rest assured we do so knowing that Americans produce some of the world’s best automobiles. One way or another, sooner or later, The Big Two Point Five will have to recreate themselves, to rise, Phoenix-like, from the ashes.
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Ah…another Dutch DJ/Producer that “makes it big”.
Rest assured we do so knowing that America already produces some of the world’s best automobiles.
Yes, the X5 (for an SUV, I think it’s the best) for one and no doubt some Toyodas that we’ll never see in these regions.
I have to say though, when talking about the actual building of cars things ain’t much different in Europe. Of course, BMW, Mercedes and Porsche can’t afford to shift their production to a 2nd world country because, probably technically injustly, but true, it would ruin their brand value. They have to stay in Germany (or at least another country perceived as 1st world), which is one of the reasons their cars are relatively expensive, even if they are benchmark cars.
Our own national (Dutch) car manufacturing company is already gone all but bust (they made the previous S40 for a while, and some Smarts/Mitsubishi models). Costs were to high and couldn’t be sustained with above average quality. Workers couldn’t (wouldn’t?) give in. About half of them are out of their jobs now and the others will probably soon follow.
GM, Ford, Fiat and PSA (Peugeot Citroen) all shifted production to first Spain and certain parts of Belgium and later the former Soviet countries.
I guess my point is that labour intensive production such as making cars (in spite of all the robots) might just not be sustainable in developed countries (at least for the moment) that are subject to high labour costs UNLESS they either deliver supreme quality or at least good enough quality so that people are willing to buy a car made in their own country even though it’s more expensive.
Farago hits on an important but rarely mentioned point — Brain Drain. It is real, and has been happening for years at the big 2.5. I attended Michigan’s most prestigious university (go blue…) — the one that’s supposed to be the feeder for the engineering and management ranks at automotive firms in motown.
To a person, I cannot think of a top-flight engineering or business student that really wanted to work at GM, Ford, or Chrysler. None. Zero.
Anyone of any intelligence that did decide to stick around and work there did it strictly for familial/regional issues (ie, they had family in the area and didn’t want to leave Detroit.)
Bad weather, bad morale, lack of innovation, and (finally) a lack of job security — it is not surprising at all that the domestics haven’t been able to compete for at least the last 20 years.
Rest assured we do so knowing that America already produces some of the world’s best automobiles.
Which ones would they be then?
——————————————————————————-
Rest assured we do so knowing that America already produces some of the world’s best automobiles.
Which ones would they be then?
——————————————————————————-
For the money, maybe the Corvette.
I can’t think of anything else.
In 2007 negotiations the UAW can, and will swallow huge consessions.It is simply a matter of survival.
There will NOT be a work stopage in 2007.
Once the new contract is signed [and it won't be easy]
the tables will turn to the enept and bloated incompetant
management.
GM will survive 2007, if management can’t or won’t make drastic changes in every aspect of the operation,I don’t hold a lotta of hope for 2008
This is also the year that Detroit must finally shuck the union straightjacket– and won’t.
Of course not. The UAW will extract as much as they can and then when the next round of down-sizing comes, take the $140K ransom…Err… Buy-out money and go keg-on in Muskegon.
(Hows everyone today? Pounding headache? I hope Im not alone… Happy New Year!)
That was a trick statement designed to see if you are still inebriated from last night and/or to see if you are still mentally alert.
The “best” American made cars would include: Accord, Altima, Sonata, and Camry.
Hands down and flat on the table, they are the best American built cars, bar none.
If you wish to include the Corvette, with its hard-top designed to eject like a fighter-canopy, go right ahead. It’s your $70K, not mine.
Happy New Year from Boise ID!
The big 2.5 need to die and reinvent themselves.
Is there any other way to rid themselves of the chains that hold them from becoming a business that produces world class products at a competitive price and one that people want to work for?
The big 2.5 could rebirth with the best products (yes, there are a few!) and people as they rise from the ashes. Hopefully to never again make the mistakes of the past.
The “best” American made cars would include:
Corvette- probably best in the world value
Full size SUV’s and pick ups- nobody does them better
Yes phil bailey America or should I say North America does indeed build some of the best cars /trucks in the world.
Chevy Impala
Mustangs
All Ford, Chev Dodge pickups there is not an import that comes close.
Caddy CTS best bargain out there
Grand Marquis/Crown Vic
Yukon
Expedition
Chrysler 300
Saturn Sky
The list could go on and on But you get the point
RF is right we do make the the best autos in the world
If the big 2.5 could get thier act together, we could be once again the biggest and the best.
The big 2.5 are hurtin but are not dead YET!
Excellent piece of writing, Robert – as always. I enjoyed reading this, sad as it was.
One point where I might want to offer a qualification – it is not the “foreigners who kicked Americas ass” – it is ourselves. For two reasons:
1) As buyers. We have let our standards slide. Instead of striving for the latest and most enabling technology, as we did for the 40s, 50s, 60s, and to a degree the 70s, we now settle for the lowest common denominator. Market differentiation is appearance (big shiney grill) or a simple low-end grunt of torque satisfication. When the question used to be “whats the best we can accomplish”, now the question is “whats the quick satisfaction”.
You might say that computer technology is the best product of this country… but take a look at our own math and science skills in schools. How can we keep it up? The emphasis on math and science is drying up compared to what it was in the 40s and 50s. The students from those eras put us on the moon, led us from prop planes to supersonic jets, opened up opportunity to all, broke the yoke of the churches, and started the sexual revolution (NOTE: all PAST history).
- Where are today’s recipients of that progress? Arguing about the “right” to wear gang colors to school. And being taught mumbo-jumbo creationism instead of actual science.
- Take a look at our business-hostile and ill-informed Government that relentlessly pursues the most competitive and successful computer software company in the world, to the benefit of increasingly foreign low-common-denominator “communal” software that doesn’t make the same financial contribution to our tax base and increasingly leaves America out of the competitive realm in many ways.
2) As workers. The Japanese brought to the table truly modern production methods and especially an intellectual environment where workers found that they could efficiently drive to the goals of the company. This is the biggest difference between the old Big Three and their successors. It’s not the size of the company that is the problem. For the workers, its the lack of an enabling and flexible environment that provides them the ability to accomplish something. The return to the workers, besides financial, is job satisfaction and personal growth. You don’t see that in the Big Three, nor in the old Bethlehem Steel, the old railroads, even ye olde IBM – where hardware and software dominance has given way to service jobs (oh, excuse me, “consulting”) with high inherent personnel costs and low margins of return (its a wonder they aren’t unionized).
Remember that the fastest growth in Toyota, Honda, and Nissan occured when they put design workers in the Americas, adapting (at first, and later uniquely designing) product for the much tougher conditions in the United States. It was our intellectual capitol that did it: our own workers (most of whom left the Big Three because of job frustration from the environments there) gave them the means to grow in this country (the same thing is happening now in China, with local workers). There are any number of famous Executives who left the big Three and found the perfect environment to accomplish inside these Japanese companies. Same for many middle-workers, and some assembly line workers (free of the union yoke for a change, they found the opportunity to attempt a change).
So what happens next with the big 2.5? Perhaps this is like a martial arts film, where our hero has to take a major fall before he can rise back up and win (but with a very different perspective on the world). Or maybe this is like Rocky Balboa: one last fight to a draw before permanent retirement. A symbolic handing-over of the world title with an acknowledgment to past glories, but also teaching one last valuable lesson in humility to the champ. No matter, the champ is still the champ, better off for the lesson, and Rocky has gone on to oblivion.
Is there any other way to rid themselves of the chains that hold them from becoming a business that produces world class products at a competitive price and one that people want to work for?
Yes. Repeal of the 1935 Wagner Act.
Once Toyota punts Ford, GM and Chrysler down the sales ladder
Ford, GM, Chrysler slipped and fell off the ladder (Humpty-Dumpty was pushed)
American made means engineered and built by US based companies that keep jobs and profits here.
The brain drain deserves much more attention. If Detroit needs fresh ideas, are they getting them — literally? Does the Not So Big 2.5 actually hire newly minted grads anymore, or has corporate downsizing made that largely impossible? Can engineers and designers who actually want to work for an American automaker find work these days?
By the same token, when layoffs hit how do younger professionals fare versus those with more seniority? Have downsizing efforts been more effective at pruning the deadwood or protecting it?
Best cars mades in America… maybe try the Honda Accord?
The students from those eras put us on the moon
You make me want to move to Dubai jwfisher.
We (collectively as Americans) went from dirt paths to putting a man on the moon inside of 70 years. (With freaking slide-rules and Relay Logic no less!) Today we celebrate the achievements of Hollywood and the Ipods. Maybe 2.5 should go back to slide-rules or the people that still know how to use them.
Coincidently, this “mediocrity” started about the time the Fed Gumint took over Public Education in the 70s.
The domestic automakers real legacy cost is the deep and abiding ill-will toward them held by their customer base. There is broad consensus GM, Ford and Chrysler are incapable of producing relevant, quality products and deserve punishment for decades of maltreating customers. I doubt the Big-2.5 can erase these perceptions for a generation or more.
Coincidently, this “mediocrity” started about the time the Fed Gumint took over Public Education in the 70s.
AMEN!
“he domestic automakers real legacy cost is the deep and abiding ill-will toward them held by their customer base.”
What he said. It’s hard to pawn off self-destructing rust buckets and models necessitating lifting the engine before changing plugs, through the 70s and early 80s , and expect people to love you.
I hope they really made good profits during those 15 years, because they lost a generation or two of Americans, and maybe most Americans forever. Their own product was the greatest marketing ploy Japan never even needed to present.
I kind of feel like it’s 1953, and I am an admirer of Hudsons, Packards, Nashes, quality cars all. Probably few people back then could have forseen a day when these independents would be no more. Robert, you are correct, the 2.5 (as currently configured) are history, by 2010 at the latest.
There are those that believe that RW is holding the good Ship General Motors on a direct collision course with sharp rocks on purpose! When what is of value is salvaged and with however from the crew survives a new ship will be re-built, leaner, faster and more menouverable. It will very likely set sail for China right away. Sad to say, this may be the only hope for GM. The thing is, he cannot look like he is doing it and if that is his game, he is doing a great job. ‘Buickman’ may well be right, GM management know exactly what they are doing, and may well signal for ‘all engines full ahead’ just before the end. What a sorry state of affairs.
The Honda Accord like many of the transplants are assembled
in North America,most of the components are built in Japan
Ask your Honda dealer where profits go.Betcha its Japan.
Ask your Honda dealer where profits go
Back to the land of the rising sun…
I don’t mean this to be a political comment. Actually, I’ve been wondering about American brain drain for many years.
Not to criticize the American defence industry, but is it possible that the most creative engineers in the US–those who could be designing autos, mass transit, consumer goods, work in the defence industries?
If this is the case, then the US has been “losing” the best potential auto engineers for decades.
While the American “allies” in Western Europe and Asia depend on the US defensive envelope for protection, their consumer industries scoop up the most talented engineers to bombard the Americans on the consumer goods front.
Any truth to this?
And where do the [now largely theoretical] profits from The Big Two Point Five’s overseas operations go?
You can’t have it both ways: America first protectionism and free[ish] trade.
Yes, Detroit still accounts for the lion’s share of the jobs in the US automotive industry. But they do not account for ALL the jobs, or the income generated in the US by automotive manufacturers.
While it’s a shame that the “home team” is struggling, we should applaud the transplants for moving here. We should welcome their US success as a success of American workers and the American economy.
If nothing else, it shows that we still no how to mass produce world-class product.
Maybe this is off subject, but I just have to mention that in the Feb 07 issue of Car and Driver, Toyota Camry finished 4th out of 5 cars in part because some trim pieces inside the car came off, it’s not the first time I hear about finish problems in Toyota cars.
Is this the beginning of a slide?
I wonder how long it takes for buyers to notice that problem and go elsewhere, is it a good sign for Ford or GM?
Gardiner Westbound
The domestic automakers real legacy cost is the deep and abiding ill-will toward them held by their customer base.
My father was diagnosed with cancer shortly after buying a new Ford Windstar. This POS was falling apart while my mother was running my father from clinic to clinic for his treatments. Transmission and head gasket problems that Ford and the dealer at first refused to acknowledge and then when they did, they could not fix properly. My father died of his cancer and my mother’s suffering was exacerbated by the problems they had with thier van. If a company could die and burn in hell, I would wish it upon Ford.
One other thing that happened when the state and federal governments took over local education – they started teaching the self-loathing, blame America mentality that infects many Americans today.
Hence the comments about how a car like a Honda is considered dramatically better than a Chevy or a Ford.
My Toyota has been trouble free for almost 80K. If there is a problem Toyota generally jumps to fix it. THis cannot generally be said of the domestic companies. I think that Toyota is very astute and can see what Detroit did to cause its’ problem. I don’t see Toyota making the same mistakes as Detroit.
Back to topic. I see more and more Americans not even giving the 2.5 a serious look anymore. My family and almost all of my friends drive Japanese products. I don’t think they hate Detroit. They just don’t see Detroit as a viable supplier anymore. With Toyota taking over the top spot and the rest of the imports taking more market share, only the diehards will be Detroit loyalists. And I don’t think that is a majority of Americans.
Detroit is headed for a giant train reck. IMO the UAW will not give up anything materially in this years negotiations. This will only accelerate the end. Too bad, many people will get hurt in this. The confrontation and mistrust that exists in the US has/will cause the ultimate failure of any turnaround plan to really work. .
he Honda Accord like many of the transplants are assembled
in North America,most of the components are built in Japan
Ask your Honda dealer where profits go.Betcha its Japan.
Ford, DCX and GM have been building cars overseas for local markets for years (a lot longer than Asian & European transplants have been manufacturing in The U.S. and Canada). Ordinary Europeans, Asians, Africans, South Americans and Australians have been buying their cars. Where do you think all the profits were (are) going? When you take a shot at the ‘Imported’ car manufacturers in the U.S. as a defense of the ‘domestic’ industry, it is worth bearing in mind that all multi-national enterprises take home their profits to their home countries. In this GM and Toyota are no different. GM’s recent investments (and success) in The PROC was not done for the benefit of The Chinese People but to stuff GM’s own coffers plain and simple and in many respects, to offset to some degree the home operation’s losses!
And the UAW will look to other types of workers to organize. Maybe illegal immigrants?
Personally I think Ford is in deeper trouble right now than GM is. The F150 is under attack from both a refreshed GMT900 and from Toyota. Ford has all of the problems GM has and an even more depressing product and brand portfolio. The Fusion has already seen it’s best sales days. The Edge is not going to be huge … and there really aren’t any other Ford vehicles worth talking about. The big secured credit facility Ford recently lined up is a ticking time bomb. Once they start missing payments on that sucker the pieces of meat will begin being torn from the bone. The entire so called Premier Auto Group is ripe for the recyling bin. Maybe Hyundai will buy Volvo to give itself an instant upmarket brand ?????
Ford Motor Company has been a badly managed enterprise most of it’s existence. The dominance of and competition amoungst family members has been Ford’s weakness since the days when Henry the First turned his company into the worlds largest disfunctional family. It is truely amazing how much success that company has known over the years in spite of it’s absurd internal culture.
“One other thing that happened when the state and federal governments took over local education – they started teaching the self-loathing, blame America mentality that infects many Americans today.” — Taxman100
Wow. I just love this quote — it is so rich with irony.
jwfisher:
Take a look at our business-hostile and ill-informed Government that relentlessly pursues the most competitive and successful computer software company in the world, to the benefit of increasingly foreign low-common-denominator “communal” software that doesn’t make the same financial contribution to our tax base and increasingly leaves America out of the competitive realm in many ways.
News bulletin – the BACKBONE of the internet was built on the so-called “communal” software you so despise.
As a software engineer of 25+ years in the profession, I’ve been using this “communal” software long before the www was on anybody’s radar….
Try doing some research….
Ford, DCX and GM have been building cars overseas for local markets for years (a lot longer than Asian & European transplants have been manufacturing in The U.S. and Canada). Ordinary Europeans, Asians, Africans, South Americans and Australians have been buying their cars. Where do you think all the profits were (are) going?
Exactly.
Also, don’t think ALL the profit goes back home. A lot of it is used to finance new investments which are made in other countries but the homeland and of which (most of the time) people in those particular countries benefit from.
Moreover, the car industry is probably a bad example, but in spite of all the globalization both the USA and Europe (if you’d consider it as 1, which, luckily, it still isn’t) are still hugely economically self-sufficient (like in autarchy, I guess?)
Finally, like some have mentioned above, the fact that GM, DCX and FoMoCo can’t compete anymore (at this point) isn’t the fault of their competitors…
Wah, wah, wah! Oh poor babies they cant compete in the global marketplace. This despite them shoving the global marketplace up everyone’s you know what for years. Well the chicken has come home to roost – globalization is here and they dont like it. Well to freakin bad.
They have only had what – 30 YEARS to catch up to the Japanese. What did they do instead?
Of course they took the easy approach and plowed money into SUVs where they could make an easy buck. Old technology, lots of marketing and they made LOTS of money. Now that gas is higher and the Japanese are systematically invading everything they are dead meat.
We keep hearing that the UAW has a stranglehold on the companies. I find it very amusing. So I guess everyone in this country does not remember the good old days when there were NO UNIONS. That was a such a great time, eh? It was great if you were RICH. Thats all. Because they could exploit you to their hearts content. I guess thats what everyone wants, right? Think I am kidding? Go do some reading about the pre-union days.
As I recall the UAW does not design the cars, nor do they engineer them, nor do they set strategy at the executive level. If you want to lay the blame of these company’s problems where they should be – its on the EXECUTIVES. Only we never hear about that. Instead they parachute out on golden parachutes and than go on to other companies causing the same damage they did in the previous jobs.
When all the dust settles the union will be gone, the worker bee’s will no longer have jobs the the executives will be RICH. Even richer than they are now. What most of you dont realize is that executive companesation is not tied to the company’s performance like widely touted. They stock goes up they make money, the stock goes down they make money.
Why dont you call go to the SECs web sit and pull the reports. You can examine their compensation in detail. I guarantee these CEO’s are not sitting up late at night worrying about the fate of these companies.
Why are there so many “contributors” that are hell bent on the demise of the American car companies? I mean pure hatred. It’s scary. I have to agree that some of this thought process was cultivated by ultra liberal teachings.
“Ford Motor Company has been a badly managed enterprise most of it’s existence.” — jthorner
Agreed. But compared to what? Chrysler, which arguably has had more frequent and damaging boom-bust cycles?
Family controlled businesses CAN be less dysfunctional than those more directly beholden to Wall Street. I suspect that the type of ownership may matter less than the quality of its leadership. More often than not, a key sign of capable leadership has been the ability to transcend whatever conventional wisdom dominates Detroit at a given time.
Consider, for example, PAG. Historically Ford has had a much better cost structure than GM because it did not saddle itself with too many brands. But then came the go-go days of merger fever, where one’s corporate manhood was measured in the number of deals one could pull off.
Merger fever was ultimately grounded in GM envy — the assumption that the biggest and most profitable automakers will have the largest portfolio of brands.
Frankly, it has never taken a rocket scientist to recognize that a large portfolio of brands would not be cost-effective (particularly for second- and third-tier automakers). Yet Ford’s management was so completely consumed by GM envy that it went on an enormously expensive buying spree (both in terms of actual and opportunity costs).
I don’t mean to minimize the role of the family in championing the purchase of Jaguar, Land Rover, Volvo and Aston Martin. My point is that Ford executives and board members are by and large so inbred into Detroit culture that to have questioned merger fever would have been unfashionably iconoclastic. (re: bad for one’s career.)
If Ford hadn’t gone on a buying spree it would be in a much better position today than GM. Family control could have acted as a buffer against succumbing to Detroit group think. That it did not was a huge — and perhaps fatal — failure of leadership.
Ask your Honda dealer where profits go
Back to the land of the rising sun…
no, they go to the shareholders. of which you could be one.
Why are there so many “contributors” that are hell bent on the demise of the American car companies? I mean pure hatred. It’s scary. I have to agree that some of this thought process was cultivated by ultra liberal teachings.
I suspect there are millions of Americans out there that are completely alienated by the way the domestics have threated them over the years. This resentment is now playing out and Detroit is feeling the ‘pain’. Too bad, Detroit didn’t think of these customers years ago. Instead the Japanese have come in and treated the customers with respect and built the kind of loyalty that doesn’t go away overnight.
I don’t see how Detroit can survive with the current management in charge and the denial that they still have about what they have done to their customer base. IMO it will take a complete revolution to get things turned around.
As many of you know, pictures of what may be the 2008 Malibu sedan are starting to appear. They look pretty good. But hey, Chevy, how about a redesign of the bowtie emblem? Sure, it has a long and honored history, but it’s kind of chintzy looking. Unlike the respectably lettered and modest-hued Ford blue oval, the brassy/goldish Chevy bowtie, with its awkward angles, sticks out like a sore thumb and detracts from the rest of the vehicle. And the use of “gold” coloring bespeaks a level of luxury and prestige that even GM would not claim for the Chevy. Even on Lexi, gold emblems are a bit ostentatious. On the Chevy, it’s a complete mismatch.
Why are there so many “contributors” that are hell bent on the demise of the American car companies? I mean pure hatred. It’s scary. I have to agree that some of this thought process was cultivated by ultra liberal teachings.
Must be us not-so-old farts educated in those horrid public schools. They are teaching Nietzsche again: “What does not kill me, makes me stronger.” Or was that too much of Conan the Barbarian?
So, was I supposed to buy the 2k6 top TWAT GM CSV instead of an Indiana-assembled Toyota Sienna? Yeah, right.
“Hatred” is such a strong word to use. Just know one thing: the emotion you label “hatred” doesn’t well up from nothing!
Yes, indeed, GM, Ford, and I’ll even toss in the “point 5″ (the “Chrysler” part of DCX)…they have exactly what ole Saddam had coming.
This time next year, will one of the year-end headlines be “General Motors: DEAD!!”?
And much like Saddam, there will be those people who actually rejoice(!!) and take pleasure(!!) in seeing GM swinging on a rope!!
jthorner mentioned Ford’s “absurd internal culture”, I’d go farther than that, and call it poisonous. The faces may change at the US auto companies, but their problems are systemic. Hard working people, with innovative ideas, are forced out, or not even considered, while the current gang of incompetent criminals select another generation of incompetent criminals to fill their shoes.
Here is the reason why I’ll never buy a Ford product.
I learned to drive in 1981. My parents bought me a ‘77 T-Bird from my uncle. My uncle was the type of customer that the American car companies loved, he bought a new car every 3-4 years for cash and traded in his low mileage car. Instead of trading said T-Bird, he let my father have it for the same money the dealer offered for it.
The T-Bird looked almost new, and had only about 35K miles on the clock. I was a very happy sixteen year old when my uncle dropped off the car.
For the first couple of weeks, all was well with my first car. One day my father pointed out to me that one of the tires was low on air. He told me to stop at the corner gas station and put in some air, which I promptly did. A few days later my father wanted to know why I hadn’t put air in the tire like he asked me. I told him that I most certainly did air-up the tire. Dad stated that the tire probably had a slow leak, and he instructed me to take the wheel off, and drive it down to the service station in his car, and drop it off with instructions to the mechanic to have it patched. This is where the fun started.
I cracked loose the lug nuts, and jacked up the car, just like dear old dad had taught me. After I got the wheel in the air, I finished removing the lug nuts, and then………….. nothing happened. The wheel would not come off. I went inside and reported this development to dad. He asked me if I removed all the lug nuts. I answered in the affirmative. Dad came out and tried to get the wheel off. No luck. We held a piece of 2X4 against the backside of the wheel and whacked it with a mallet. Nothing. We placed the lug nuts loosely on the wheel and let it drop down off the jack hoping the weight of the car would break the wheel free. Nope.
At this point Dad and I took the car to the corner service station and told the mechanic that we couldn’t get the wheel off. The mechanic told us that we had to take the lug nuts off first. Right, we did that. The mechanic informed us that he encountered this problem with this model car before, and it would cost $300-$400 to get the wheel off! This was in 1981 dollars no less. At this point, my father’s eyes turned to little slits, which meant that his BS radar had just gone off the scale. When asked why it cost so much, the mechanic told us that he couldn’t get the wheel off without destroying it, and a bunch other parts in the process. My father said nothing, we put some more air in the tire, and drove home.
At this point my father instructed me to call the local Ford dealer and inquire about the difficult wheel. This is how the conversation transpired:
Service Writer: “Service department.”
Me: “Yes, I’m having some trouble with my car.”
SW: “What model, and what kind of problem?”
Me: ” 77 T-Bird. I can’t get the front passenger side wheel off the car.”
SW: “You can’t get the wheel off? That’s because you have to take the lug nuts off first.”
At this point, the service writer and someone in the background start to laugh hysterically. After they stopped laughing, I resumed with the conversation.
ME: “Yes, I know that. The wheel still wouldn’t come off”
SW: “Bring the car down, we can probably get it off.”
Me: “What will it cost?”
SW: “I don’t know until we see the car.”
Me: “You can’t give me ballpark figure?”
SW: “It could cost a few dollars, or a few hundred. I don’t know, until we look at the car.”
Me: “Thanks.”
I report this to my father, and he tells me to call Ford’s customer service office and see what they have to say about this.
Ford Customer Service: “Ford customer service. What is the year, make, model, and mileage of the car you are inquiring about?”
Me: “77, Ford, T-Bird, 36K miles.”
FCS: “Your car is out of warranty, sir.”
The manner in which he said “sir” he really meant “asshole”.
Me: “Don’t you want to know what is wrong with the car?”
FCS: “What is wrong with the car, sir(asshole).”
Me: “I can’t remove the front, passenger side wheel.”
FCS: “You have to take the lug nuts off the wheel first, sir(asshole).”
Me: “Yes, I know that. The wheel won’t come off.”
FCS: “Take the car to the dealer, sir(asshole).”
Me: “Do you know what the dealer will charge for that?”
FCS: “We don’t set the dealer’s prices, sir(asshole), they will probably charge some nominal fee.”
Me: “The nominal fee is several hundred dollars.”
FCS: “We have no control over that, sir(asshole).”
Me: “You don’t think it is strange that a wheel can’t be removed from a 4 year old car, and that I should have to pay hundreds of dollars to have it removed so I can have the tire serviced?”
FCS: “We don’t know the condition of the car, sir(asshole). The wheel could be damaged.”
Me: “The wheel is not damaged.”
FCS: “Are you an expert, sir(asshole)? You can also take the car to an independent service station.”
Me: “The local service station wants $400.”
FCS: “We have no control over that. In any case, your car is out of warranty, SIR(ASSHOLE).
Click. The SOB hung up on me.
I tell this to my parents. My mother suggests that I go to the library and find the address for the DOT and see if there is any recall info on the car. (Remember how easy it was to get info before the internet?) The librarian was very helpful, unlike the people at Ford, and she promptly found the appropriate address concerning such matters. I wrote a letter to the DOT, and a couple of weeks later I received a reply. (During this entire time, I had to air-up the tire twice a day)
The DOT sent me a letter stating that they were aware of the stuck wheel problem with these cars, and that their investigation concluded that since it was not a safety problem, no recall was ordered. They also sent me the entire investigation report on micro fiche.
The report was fascinating, to say the least. The 77 T-Bird was offered with a number of wheel options — steel wheels with hubcaps, aluminum alloy wheels and “alloy styled wheels”. My car had the “alloy styled wheels”. The “alloy style” wheels were stamped steel wheels that had a plastic facing glued to the steel to make them look like aluminum wheels. The heat from the brake would melt the glue and it would ooze between the wheel and hub. The wheels on my car were glued on! The DOT report went on to state that Ford’s solution to the problem was to burn the wheels off with a torch!! This “solution” destroyed the wheel, tire, brakes, and hub.
My father and I agreed that burning the wheels off was not a good option. We thought about it for a while, and my father measured the slots in the wheel and sent me to the local tool rental place to inquire about their biggest gear puller. The tool rental man brought out the gear puller and I measured the jaws — they would make it through the slots, just. The tool man asked about my project, I told him I was pulling the wheel off a 77 T-Bird. He though I said 57. I corrected him as to the actual model year. He asked me if the car was wrecked. I told him it was not. He told me that I needed to take the lug nuts off first. I just shot him a look. He said he wouldn’t be responsible for any damages to the car and I would have to pay for the tool if I broke it. I reassured him that he had nothing to worry about.
When I got home, Dad and I jacked up the car, took off the center cap and managed to pry off the hub grease cap. We pushed the jaws of the gear puller through the wheel slots, and centered the jack screw on the spindle. After taking up the slack, we applied torque with a breaker bar. It only took about a quarter turn and there was a loud pop and the gear puller went slack. The wheel was off. We went around the car and found another stuck wheel, that one was also successfully yanked off with the industrial strength gear puller. After the leaky tire was repaired — I refused to tell the local garage mechanic how we got the wheel off — we scraped the glue off the hubs and wheels and applied a thin coat of grease to same.
A year later, I was in college, and circumstances forced me to sell the T-Bird. I have never considered a Ford product after that, and never will. If Fomoco goes belly up, I say good riddance.
In the 80’s and 90’s I stood by the American car industry and like so many of us, I was screwed by poor quality and poor dealer/warranty support. There are still people that wave the flag in front of my face and I just don’t care anymore. I buy what’s best for my money and if the profits go to France (Nissan), so be it. At least they dont ignore my needs.
One of the biggest problems in a blog is always those shallow readers/rapid posters that misinterpret most messages from other people;
The negative feelings most people may have against gM or Ford are not anti-americanism. Most of the time it is just a reflection of the resentment toward the corporate world.
The big 2.5 are fine examples of the worst possible aspect of the bloated arrogant corporate ethos.
If some people actually recognize in that avatar the soul of the USA you should probably stop and think why is that…
Capitalism has it great benefits but unbridled it is souless “survival-of-the fittest” system.
The negative feelings most people may have against gM or Ford are not anti-americanism. Most of the time it is just a reflection of the resentment toward the corporate world.
The big 2.5 are fine examples of the worst possible aspect of the bloated arrogant corporate ethos.
Well said!
weep not for GM, weep for their dealer network. I swear it hasn’t changed one iota since the first dealers wrote the book, “how to fleece a sucker” back in the early 1900’s.
it took me all day in the dealership to buy a corvette in 2005. When I went back in (via email) to the (same) dealer to buy an 07, the first email exchange was the dealer’s internet manager bragging he sold all his vettes on ebay, with a quote over msrp. two weeks later he changes that to sell some Z06’s at msrp, but doesn’t notify me personally, only a general broadcast email to which I was subscribed. Then I went in for a ballpark estimate of trade-in advising a 6500- mile garaged vette sold and serviced by them, and he replies advising he couldn’t possibly give me a ballpark trade-in value by email. brand loyalty and dealer loyalty? phooey, I’ll buy from Kerbeck next time (if) I buy a vette.
But I contrast this experience with buying both a Porsche 997 and Toyota FJ Cruiser through their respective dealers internet sales. pro forma invoices were provided asap, no addl dealer markup games, just very quick and professional transactions from dealers selling cars at the top of their respective games, vs the blue suede shoe salesmen I always have to wash my hands after dealing with slithering around GM dealerships.
Its NOT anti-American, and it’s not anti-corporate resentment.
It IS a statement that WE CAN DO BETTER! And not to settle for half-ass crap anymore!
On the topic of the brain-drain, it is indeed very real, and a very important topic. But of course the media rarely mentions this, and auto execs rarely talk about it as well. For instance, over the past 2 years, GM has quietly let go over 500 engineers.
It’s definitely ironic; GM has too many workers (including engineers), too many costs, and a bloated, inefficient corporate culture and structure. Toyota meanwhile doesn’t have enough engineers. Toyota at it’s current pace is hiring about 2000 new engineers per year.
This is a very real fact. The best and brightest engineers, designers, and managers from all over the world, what companies do you think they want to work for? GM, Chrysler, or Ford? Of course not. All of them want to work for Mercedes, BMW, Toyota, Honda, and to a lesser extent, Hyundai.
Toyota is the very symbol of success in the auto industry currently. This attracts a lot of talent.
And speaking of profits, last time I checked, Ford and GM ARE NOT making any profits. So, the profits would go to the States, but they currently don’t exist. Also, who do you think pays of all GM’s Chinese workers, and where do you think the funding comes from all of GM’s China ventures? Some of you should really stop being so ignorant.
And last time I checked, GM, Ford, and Chrysler are ALL closing down plants in North America, and laying off thousands of workers. How do you think those workers feel? I will tell you, not very happy. Meanwhile, the import makers are building new plants and North America, and hiring thousands of new workers.
Who currently are pumping billions and billions of dollars into the North American economy? Is it American automakers? Nope. Most of their limited capital is going to overseas ventures. They are merely spending the bare minimum to upgrade some of their North American plants to accomodate retooling for new and redesigned models. The imports are the ones reinvigorating North America’s auto industry and pumping billions of dollars into the economy.
And one more thing; I am shocked as to how naive, egotistic, and how much disregard some of you have. All you care about is America, America, America. Here is a newsflash: there is more to the world than only America. There are other countries that exist outside of America. Canada for instance.
Do none of you care which automakers are providing jobs and investing money outside of North America? Doesn’t seem like it. But you must face the facts, that in countries outside of North America, the imports too spend more and invest more in new workers and new factories than American automakers do. Many of you may not like it, and that is the truth.
Lastly, I’m in Canada, and Toyota and Honda over the past 20 years have done much more for workers and the economy than American automakers ever did. Both Toyota and Honda built new factories in the past 20 years, and in 2008, Toyota’s new Ontario factory goes online, and with this one new factory, Toyota is pumping over 1 Billion dollars into Ontario’s economy.