So the automakers dry up and whither to a fraction of what they are today and alot of their supply chain does the same. Maybe the management will finally take a hint and decide they need to build GOOD desireable quality products. Not some version of two of those three.

As for outsourcing parts – there are plenty of auto parts manufacturers around the world that can step up if the domestic guys fall on their noses. Harley-Davidson is buying parts for their “American” motorcycle from all over including CHINA. Not that I’m happy about that but it is entertaining when I meet some Harley dude with a big opinion of his American bike while he looks down on whatever rice-burner I’m riding then.

I think it is time for the leadership of the car manufacturers and the unions both to do some serious re-evaluation of their priorities.

Maybe this is something that America as a whole needs to re-evaluate.

Does Detroit want to demand high wages now or do they want to have a job in five years? I hope they choose a longer outlook than what works for the next 6 months. I get the feeling though that they think if they can out last the recession that life will be rich and easy all over again. No it won’t because with each passing year of my entire life they have slipped further and further towards the edge.

Let’s get it over with and let them go broke and rise from the ashes.

You can easily figure out why this plan wouldn’t work by adding up the sales numbers of the cars you want to keep. Large corps with high fixed cost can’t magically shrink to a fraction of their size.

Buying low-tech subassemblies from China can hardly be compared with the necessary strategic capability of designing and building special-purpose vehicles by the tens of thousands.

A heavy-industrial capability is still a strategic necessity. If the Big 3 go down, who do we rely on… Caterpillar and John Deere (until Hyundai take them out too)? Or do we federalize the imports’ plants and engineering here in the US?

Everyone has lousy salespeople, that’s part of the business and can’t be helped. Many of them have lousy service departments. The domestics have no monopoly on bad retailing.

But those automakers that build a more reliable car will have fewer angry customers because the customer will have fewer opportunities to interact negatively with the dealership. The dealership is less likely to piss you off if you don’t have to go there.

A related issue is that a penny pinching organization will create more opportunities to antagonize the customer when warranty claims are denied. Since the dealership won’t typically eat the cost, the dealership and the brand will both be damaged by the denial.

Right. Hendricks and Penske send all their crappy employees to their Chevy stores and save all the good ones for their Toyonda shops.

And again I have to play the WTF card. Are you arguing that bad dealer experiences are not a part of the domestic’s problem?

My guess is that because the domestic auto dealerships outnumber imports by ~ 3:1 it is easier for a bad domestic dealer to sour a customer’s relationship with the brand than it is for an import’s. Maybe the import manufacturers more closely monitor their dealers than the domestics, I don’t know.

It’s the height of irony to accuse the US of racism, xenophobia and bitterness over WWII in the context of Japan. The Japanese don’t want to address their use of Korean women as sex slaves, while we Americans freely admit that our dads and granddads fucked their way through Europe using chocolate bars as currency.

Ronnie, Seriously, WTF are you talking about?

My point was simply this: You piss and moan about the “perception gap” that the domestics have to face. My point was simply that the Japanese and German imports had a significantly greater “perception gap” than the big 3 ever had (or will ever have) because the perception that Japanese-made cars were crap was magnified by racism and bitterness over WWII and they still managed to get over it and become top dogs.

What that has to do with Korean sex slaves or Japanese textbooks is …. what, exactly?

DoD, NASA, and every military contractor there is buys more than a few mission critical sub-assemblies from China. Let alone Japan.

Detroit didn’t take it personally when my car broke down under warranty and their companies said it was my fault. They didn’t respect my view when my car came back to me in worse shape than when it went in and all they said was “sorry, we’ll fix it next time” and never did. I just got rid of my last D2.8 car I will ever buy. I’m very happy with my “import” car. By the time GM finally changes their business model and entire corporate culture right down to the dealership experience, I will probably have died of old age by then.

I could go on and on and but that does not help the D2.8 come up with a real sustainable recovery plan. I thought that’s what the well paid CEO and executives were supposed to do.

He’s been way out-front on Detroit’s (and others’) flawed products and business strategies for years. And how our government’s been asleep-at-the-wheel with industry support when foreign governments nurture their auto industries.

I think his recent posts deal more with his belief that a healthy auto manufacturing sector is a strategic national asset that should not be allowed to die… not only is it vital to our security, but it permeates into thousands of businesses in the supply-and-distribution chain from coast-to-coast that employ millions.

Would we allow Boeing to go out of business… so we could go get our jet fighters from Sweden, France, Israel or Japan? I don’t think so. A domestic vehicle manufacturing capability is similarly vital… I don’t want to rely on Nissan or VW for HumVees.

Detroit has made many many missteps. Detroit’s dealers are also a generally poor bunch, but no worse than Toyota, Honda or Nissan stores.

What I think Peter is saying is basically:
A) our government ought to REALLY consider the strategic benefit of a domestic vehicle industry and maybe start fostering success rather than impeding it, and
B) as consumers, we really should give a look at what Detroit is offering… the products are demonstrably good, and maybe we’re all a little better off if we buy from our neighbor instead of someone from across the ocean.

I know what I like – and there aren’t many cars made by the big 3 on that list.

There are no “facts” you can present me to convince me that most of their cars pale in comparison to the readily available competition.

Not to mention DEALERSHIP EXPERIENCES?

Having read DeLorenzo’s stuff for quite awhile, I just don’t see him as that critical of DET.

As has been pointed out, the only thing he is truly critical of is branding and marketing.

Too many lines, disjointed, overlapping? Please, these were discussions I had with my friends when we were in high school. Our parents all got tired of the D3 back in the late 70s, and we understood why.

If you read his stuff through the lens of a non-DET employee, he’s 10 years late and 250B short of reality.

My friends and I saw this coming 20 years ago. We kept watching the market share slide even then. 5 years ago anyone who paid any attention at all saw that the day of reckoning was on the horizon. And that GM was doomed.

Fixing it? I enumerated a rather short plan for Chrysler. GM isn’t much different. This is just business. Why haven’t the braintrust fixed it yet? Simple. It’s not in their personal best interest to do so.

Unfortunately the kind of bloody, messy, radical change that’s needed will never happen as long as people ignore the financials, and pretend that somehow it can all go back to good.

Your plan for GM goes about one quarter of the way. What’s going to need to happen is the other three-forths. It will happen whether you want it to or not. Doing the one-forth only makes things harder to fix in the long run.

Right. Hendricks and Penske send all their crappy employees to their Chevy stores and save all the good ones for their Toyonda shops.

It’s the height of irony to accuse the US of racism, xenophobia and bitterness over WWII in the context of Japan. The Japanese don’t want to address their use of Korean women as sex slaves, while we Americans freely admit that our dads and granddads fucked their way through Europe using chocolate bars as currency.

Is there any American word that denigrates non-Americans akin to the way geijin denigrates non-Asians in Japan?

Are there any US textbooks that whitewash US actions during WWII? Most US textbooks spend more time on the bombing of Hiroshima/Nagasaki and the internment of Japanese Americans than they do on the battle of Midway or the attack on Pearl Harbor. Do Japanese textbooks discuss the brutality of their occupation of China? Do any textbooks in Japan discuss their active biological warfare activities? The US got many of our rocket scientists from Germany – the germ scientists, though, came from Japan.

That’s debatable. But in any case, you still haven’t addressed the issue.

What you have done instead is effectively tell us that the current GM “plan” of combining BPG and crossing fingers is a good one.

Obviously, the results show that it is not. Buick is no more desirable now than it was before. Ditto Pontiac. Ditto everything else. Nobody really cares how many cars Buick has, they just know that they don’t want them.

Once again: Show me how vehicles will be sold at a profit. I understand that vehicles can be moved with cut rate financing and discount prices, but that does not lead to profits.

We all know that insanity is defined as repeating the same mistakes with the expectation that something will change.

It’s unfortunate that those who have the disadvantage of a post 1970s education, who didn’t have to learn things like historical facts because the schools were more concerned with self-esteem, think they know so much. My daughter, who is 29 and no right winger, bemoans how it’s hard to discuss things with her contemporaries because they have plenty of opinions, but have little solid knowledge backing up those opinions.

That’s simply not true. Shelby’s pet Mercedes plant is on hiatus for half of January, will close for a full month later this year and has offered all the plant employees a buyout. Honda and Hyundai which make SUVs at their Alabama plants have cut production by about 40%.

If the South is so hospitable to business, what happened to all those textile mills and furniture factories?

I’ve already posted what I think Chrysler should do: cut all product lines where they aren’t competitive. Shrink back to minivans, Jeeps, Dodge trucks and maybe the LX platform vehicles. Honda doesn’t compete in all segments and neither should Chrysler.

Ford seems to have done most of the heavy lifting they needed in terms of restructuring and matching capacity to demand.

GM is a knottier problem because while they’ve mismanaged those brands, the brands still have some value. Eliminate about half of their dealers, focusing on urban areas. Combine Buick, Pontiac and GMC into one dealer channel, giving Buick one or two sedans for the near luxury segment and the Enclave plus a smaller CUV. Pontiac should be performance vehicles only. G8, Solstice, and V6 coupe and convertible versions of the G6. With the Malibu and Aura, there’s no reason for Pontiac to have a plain Jane sedan. If they can shoehorn an Ecotec into the Aveo/G3, that might make sense too. Chevy should be the mass marketer, but I’m not sure if they should sell anything badge engineered – so Buick might be the only one with a Lambda CUV. The real question is what to do with Saturn. They have 400 good dealers. Perhaps badge engineered Opels might make sense – just nothing that competes directly with Chevy & B/P. Building on the success of the CTS, Caddy needs a bigger sedan that can compete with 5/7 series BMWs, the large Lexus, and the E and S Class M-Bs. Caddy will also need their crossover to compete with the RX Lexi, so the SRX stays. Caddy also can’t walk away from the Escalade buyers.

My guess is that GM, Ford & Chrysler have done enough focus groups and other consumer testing to come to the conclusion that backlash from a bailout would hurt sales less than filing Ch. 11.

I’m putting together a list of questions to ask execs at the NAIAS and this one is going on the list for all 3 of the Detroit companies: Have you consumer tested for a bailout backlash?

Thanks for trying to dodge that bullet, but you haven’t.

You are the advocate here, so it is up to you to support your position.

I’d like to see your plan for fixing Detroit. Since we all agree that not fixing it will lead to their deaths, hence the need for taxpayer money, we are all clearly in agreement that a problem exists.

I want your solution to the problem. I have mine and I have offered it, but you have offered nothing of the sort.

You need to convince Americans to buy the cars, and you need to match the company to that level of demand. So how would you do it?

I’m pretty much identified as a “Detroit defender” here and I’ve never said anything about “evil” Japanese or “stupid” American car buyers. I don’t think you can find anything similar in Delorenzo’s writings either. The inference of racism or charge of blaming the “victim” i.e. the consumer, is just a strawman argument.

Delorenzo’s refusal to categorically condemn Detroit despite his own pointed criticism of the domestics marks him as a heretic in the eyes of the Detroit-can-do-no-right crowd. True believers have a difficult time with nuance.

Every time I ask the Detroit-can-do-no-right crowd for constructive criticism instead of schadenfreude filled piling on, almost none of them will answer that question. They have plenty of time to whine about evil Detroit automakers and stupid UAW workers, but they seem to have no time to suggest a recovery plan for those automakers.

Without profits, the loans can’t be repaid, and it is likely that even more money will be demanded later, turning this into a Michigan money pit.

My eyes must be deceiving me. Farago keeps telling me that nobody is bashing Michigan. As for money pits, California and New York, about 20% of the US population, are about $50 billion in the red between those two states.

Toyota must be part of this supposed old guard since they spent over $700 million building their North American r&d center in Ann Arbor, less than an hour from Auburn Hills, the Glass House, RenCen and Solidarity House. When VW decided to put their HQ on the east coast, they still had to keep about 400 staffers in Detroit. Tesla’s closing of their Rochester Hills engineering shop got a lot of attention but what isn’t widely known is 60-75% of those engineers are still working for Tesla at a different facility in suburban Detroit.

Virtually every company that does automotive business in North America has some kind of facility or operations in southeastern Michigan.

That may be part of it. But he is also fairly questioning why we would hand money to a business that is simply going to burn through it and demand more.

So far, the Detroit defenders can’t answer that question. They have plenty of time to whine about the evil Japanese and the stupid American car buyer, but they seem to have no time to create a legitimate plan to sell vehicles to those stupid Americans at a profit.

Without profits, the loans can’t be repaid, and it is likely that even more money will be demanded later, turning this into a Michigan money pit. Since whining isn’t really much of a plan — try that at your corner bank and see how far that gets you — the guy may have a point.

That just shows how little Shelby knows about the auto industry. He thinks he’s helping Mercedes, Hyundai, Honda and Toyota who he insists are all doing well. As he was saying this, all those companies were cutting production at their Alabama plants.

Sen. Corker at least made a good faith effort to come up with a deal. Of course, he’s now considered a heretic by some who post here because he said nice things about GM’s Spring Hill engine plant. Four legs are better than two legs and anyone who dissents from “Detroit can do no right” must be shunned as unclean, unclean.

Robert, what does Delorenzo say here that is wrong? There are people who simply won’t consider a domestic brand. Not even the handful of cars like the Malibu, Fusion or CTS that you acknowledge are worth considering. Detroit has a very challenging task ahead. Product is the most important factor, but once you have good product, how do you get the 30-50% of people who won’t consider a domestic brand know that you have good product? I figure it takes 5 years minimum to establish some kind of word of mouth about reliability and resale value.

First off, even assuming that’s true (regarding the 30-50% numbers), so what? That is exactly the situation the imports were in 30 years ago, plus the import-phobia of the time was exacerbated by a subtle but noticeable garnish of racism, xenophobia and bitterness over WWII.

So the answer is obvious: Detroit is going to have to win those customers back the same way Toyota, Nissan, Honda and others won them in the first place: One customer at a time, by building decent cars and by performing better than people expect.

And by “perform”, I don’t mean the cars as much as I mean the dealers. Sloppy service departments, quibbles over warranty repairs and slick, sleazy salesemen are going to be the death of the big 3. Detroit needs to understand that the dealer is the “face” of the brand and people who have a bad experience at Joe Blow’s Chevy are going to be sour on Chevy for a long time after Joe Blow closes his doors.

IMO one of the primary reasons for the success of Honda and Toyota was the positive dealer experience people had. That’s the kind of word-of-mouth that makes sales.

Of course, the other tactic they could take is to simply beg for money from the government with not-so-veiled threats of economic catastrophe, and then try to shame people into buying their products with lame attempts at hiding behind the flag.

Which one is more likely to work?