If patriotism is a scoundrel’s last refuge, American automakers and their domestic defenders have been fixated on the end game for decades. The Car Connection’s Gary Witzenburg is only the latest industry wag to try to wrap The Big 2.5 in the American flag. In a rehash of a November 2003 editorial for Automotive Industries magazine, Witzenburg offers gullible readers a lesson from his school for scoundrels.
Witzenburg’s polemic– "What's an American Car?"– starts with a proposition. “Say General Motors decides to build Chevrolets in Japan…” The former GM PR flack argues that you couldn't consider this theoretical, made-in-Japan GM product a Japanese car because it was built by an American-owned company.
Meanwhile, back in the real world, Chevrolet builds and sells the Epica and Spark in China. Buick builds and sells the GL-8 minivan in The People's Republic. GM builds Aveos in Korea and sells them at Chevrolet dealers across America. By Mr. Witzenburg’s standards these are all American cars. By anyone else’s, they’re Chinese and Korean.
In Witzenburg's world, a Honda Accord designed by American engineers, fabricated by American workers (paid in American dollars), built in America (Marysville, Ohio) with mostly (though not exclusively) American-made parts is… Japanese. Anyone familiar with multinational automobile manufacturing knows that today's world market simply isn’t simple enough to support Witzenburg’s simplistic logic fed by yo yo bento.
For example, how would the polemicist classify the country of origin for cars built at NUMMI, the joint venture between GM and Toyota? The California plant produces both the Toyota Corolla and Pontiac Vibe. Do their respective badges make the Corolla Japanese and the Vibe American, even though they share parts and roll out of the same assembly plant? Not even dancing Tony Tuttle would agree with that.
As Witzenburg’s rhetoric shifts into high gear, the contradictions raised by his position become increasingly obvious. The writer’s definition of American cars expands to include Chrysler products— even though the company is owned (at least for now) by Germany’s DaimlerChrysler. At the same time, Witzenburg labels Opel a German car brand– even though it’s owned by General Motors.
So the location of a car company’s headquarters determines its products’ nationality; or the citizenship of the people who screw it together; depending on Witzenburg’s personal preference.
Poor Witzenburg. He lives at a time when Australian Holdens become “American” Pontiacs and German Opels become “domestic” Saturns– which are sold in showrooms next to "true American” cars (many of which are built in Mexico and Canada). The Big 2.5’s global production model has removed any remaining justification for the writer's “America first” defense, who must serve at the pleasure of the president.
No surprise, then, that Witzenburg changes tack and adopts the hackneyed “what’s best for America” argument. He states “while some (mostly southern) states continue to battle each other with big incentives to attract new foreign-maker plants to gain two or three thousand jobs, other (mostly northern) states lose tens of thousands.”
Witzenburg seems unaware that these “mostly southern” states have been trying to attract the automotive industry for years. They were snubbed by the American automakers based in the “mostly northern” states. Now the same automakers are crying foul when southern states do whatever’s necessary to lure industrial facilities, using incentives to create jobs for their citizens. Just like Michigan.
“What they did not see, or chose to ignore, is that ‘creation’ of a few thousand plant jobs here and there would eventually destroy many more and better jobs elsewhere.”
What Witzenburg doesn’t see, or conveniently ignores, is that the jobs in question were destroyed by The Big 2.5's refusal to recognize and adapt to a changing market, and the way they rolled over and played dead for the UAW. The Big 2.5’s tunnel vision led to this situation, not the efforts of a few state governors to provide a better standard of living for their constituents.
Witzenburg then quotes Jim Allard, professional organist and president of the Ford-funded Level Field Institute. “Is it more important to the U.S. economy for someone to buy a Ford Fusion, although it's built in Mexico, from a company that employs 105,000 SUV-driving Americans than a Honda built in Ohio from a company that employs 27,000 sushi eaters?”
In a word, no. If Americans bought automobiles based entirely on the number of ignorant Americans an automaker employs– not upon the vehicle's quality or value– there'd be only one domestic manufacturer. We'd all be driving something truly nasty (e.g. Lada). What's more, if foreign consumers followed the same rule, they'd never buy an automobile from an American subsidiary.
The Big 2.5 have staked their future on their ability to leverage the world automotive market for domestic success. Their plan contradicts the knee-jerk patriotism they've promolgated– or at least tolerated– ever since the foreign "invasion" began. Ironically enough, Gary Witzenberg is paving the domestics' road to Hell.
[To read Gary Witzenburg's editorial, click here.]
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Extend patriot Witzenburg’s logic one step further, and you get this little bit of irony: buy a 2.5 branded import, please! Never mind that the trade deficit is at an all time high…
When someone prays on peoples sense of patriotism/guilt, it is like trying to get sympathy-sex at a bar… Pathetic.
I have been awaiting this editorial. I read many automobile message forums and this is a constant running theme on many of them. This is my opinion. I self identify myself as a patriot and I also self identify as an American nationalist.
However, I don’t’ equate the brand of car I drive with patriotism or nationalism. I also don’t equate as some do with any analogy of the United States is to GM as Toyota is to Japan bunk. I read those same refrains of patriotism and nationalism over and over and over again virtually everyday on autoblog and Detroit news forums by the same people every freakin day. The irony is reading them from self identified employees of Chrysler berating people for buying a car from a foreign company or reading comments on how the United States should ban foreign autos from self identified Big 2.5 employees in Canada.
I am an American I love this country. How dare the supporters of GM, Ford or Daimler Chrysler try to equate my purchase of a car with patriotism.
I love America because in America I am allowed to do what I want and like what I like and buy what I to want to buy and at the same time you are allowed the same opportunity. That is what being an American is all about. In their eyes I could be an ax murderer and as long as I buy a Tahoe I am more patriotic. I love America because I am the son of refugees from a communist takeover and here capitalism and free enterprise are allowed. Yet I read on those same forums from many of the same America first alleged patriots comments and questions on “Why are foreign companies allowed to sell cars here?”
I love America because the American Ideal is that you are judged by your actions not by birthright, that opportunities exist for those willing to work hard. Most people that I know believe that people should be judged on their merits or actions. That is why I am a patriot. I believe in a meritocracy. Most people I know believe that people should not be judged on things like who was their daddy or the color of their skin. So why would I be upset that Toyota or Honda are successful? That is what America is about. These same people seem to feel that a company like Ford should be rewarded for deliberately not updating their successful products like the Ranger, the Focus, the Lincoln town car and the Taurus? Those were all success stories. I can’t help it if Ford was run by morons.
Its not my fault that the bean counters run amok have cheapened the interiors or enforced draconian price cuts on their suppliers which may have hurt the durability of their product. Why is it that no one has been held accountable for the shitty way the big 2.5 have been run.
The simple fact is that Toyota and Honda are successful in selling cars because they deserve to be successful and GM, Ford and to a lesser extant Daimler Chrysler have been losing market share because they deserve to. Auto companies and their products should be judged like people on their merits and past actions not on who they are.
The lines have blurred regarding “consumer patriotism” to the point of being meaningless. “Classic” American electronics and appliance brands have been resurrected to label Chinese-made goods of all sorts; Harley-Davidson makes more money on HD-labeled, foreign made baubles than they do on their bikes, and it seems that the best selling “American” cars are Hondas and Toyotas. If you want a definition of the “New America”, just look at the stock market, and it’s easy to see that the “Almighty Dollar” is the only product that the domestic corporations care about, with this profit built on the backs of the cheapest “labor-du-jour”. It’s a bubble that will continue to grow and burst as profiteers contimually seek to cut labor costs, by seeking the lowest ISO-Certified assembly plants on the totem-pole. The whole thing will finally hit bottom when we’re importing cars built from Bangladeshi-salvaged tramp steamers and oil tankers; hopefully I’ll know to move my 401(k) money just before this happens. With the self-destruction of the UAW (to paraphrase Darth Vader) “the circle will be complete.”
The Car Connection is and always has been, a poor excuse for an automobile web site.
I fully agree that Ford and GM deserve the market backlash that has hit them. They simply were not delivering competitive product.
That said, GM and Ford are now delivering product that meets or exceeds the compettion in a number of segments. For example, The Ford Fusion and Saturn Aura are just as good as the Camry and Accord—and arguably better values. GM’s + 3.7 sales vs YA point to the product driven discussion….better product will sell.
Keep an open mind people—-please don’t turn car buying and commentary into the mess our political system is in where far right and left idiots control the dialogue. Net, you can hold Ford and GM accountable while still recognizing they have made progress over the past couple of years to field competitive products !
Nice article Mr. Williams. I posted my response, or planted my seed for this article yesterday at the bottom of Chrysler Suicide Watch 9 so I will not repost it here. All I can say is that attitudes like the misplaced patriotic statements concerning “buy American” in part come from misinformed, or uninformed public. Its kinda like voting, should there be a basic competency test as you enter the polls? (should you be allowed to vote without having a clue what a candidate really stands for, or not knowing anything about them except for how they look?) After this president I’m more than convinced we need one for the office of president.
Maybe we need a basic competency test, or at least post a reliability index for all printed, or all media launched bits of knowledge. Maybe things springing from Rush Limbaugh get a 0 and those closer to actual reality get an 8 or a 10. Would that give the Chevy truck commercials a 2 stamp.
How effective would that make their truck commercials that include “this is our country…”be, if at the end of the ad a mandatory “This ad received a 2 based on unreliable or untrue content” For that matter how about the next election.
PS please don’t go off an a political tangent I don’t want Robert to edit this out, just stick to the car stuff.
later.
Thank you Frank for raising this issue!
I am sick and tired of seeing “This is my country…” type of BS.
What’s good for America is more jobs here. And we all know who are creating new factories here, and who are shutting them down.
I’m sure UAW-types will be quick to point out that for each Toyota/Honda/Nissan/Hyundai/BMW/Mercedes job that opens here, UAW loses more jobs.
Well, I say: tough luck guys! It’s UAW’s fault for trying to kill the goose that lays the golden egg. Economics 101 says if you raise wages beyond a certain limit, number of jobs goes down. Live with it.
Hell, if it weren’t for UAW, I’d bet GM/Ford will just pack up and move to China.
I think all can agree that blind patriotism is a bad thing—Hitler proved this one out.
That said, rooting for the home team to win is not something that is either misinformed or uninformed. If Ford and GM launch a competitive product—I will look at them and consider for purchase. If they don’t—I’ll pass and hold them accountable via my wallet.
Sadly, most of the posters and editorial staff on this forum are not as open minded. The mere suggestion that they look at a competitive (see Fusion / Aura) Ford or GM product is met with a “how dare you suggest that” disdain….”i would not ever want my friends to see me in an American car”
Holding GM and Ford accountable is one thing (don’t buy their cars !). Happily rooting for them to lose is kind of sick given their historic and current contribution to the US economy.
I think that GM Ford AND whatever’s left of Chrysler WILL pack up and move to China, just as virtually all of the so-called American electronics manufacturers did. Sure, there may be some kind of “headquarters” for once proud US electronics brands within the borders of the United States, but on every single box you look at, it says “Made in China” (meaning, a communist country), “Made in Taiwan” (the “real” China government and people, at least the non-commies), “Made in Mexico” (assembled there from Asian components, in other words, taking away assembly jobs in the United States where, at the last, electronics were made with Asian components).
It won’t be long. A few years. The UAW is going to be only found in the history books.
Well, its not to say that labor unions don’t have their place. Lets not forget what brought about the union in the first place. And looking at how Nasser, Billy, Al, and Rick, and whoever runs Chrysler, how these guys loot the chest as the company makes negative profits we can only imagine how much more poorly labor would be treated without the union.
The problem is greed, and its present in management, labor now that they have lots of power, possibly too much. But then labor, and unions with 2 notable exceptions have been losing power, and size for decades now.
Once the UAW is broken, and it will happen in bankruptcy, wages will fall to match what the transplants are paying. And keep this in mind, When globalazation envougued our leadership it was like taking 2 unequally filled glasses of water placed on the same table, and attaching a pipe from just above the base of one glass, over to just above the base of another glass.
Just as intended, labor and standard of living went up in countries where typical wage for building a car might have been $2/day. But higher living countries had to fall because more comparable product was available at more competitive price. Only one short Texan tried to inform a stupid public about the unadvertised consequences of NAFDA.
We should have been more patriotic then.
hondaboy55:
If you don’t want this discussion to go off on a political tangent whan why are you posting about politics? Your not very veiled barbs against President Bush and Rush are an blatant example of what you are asking us not to do. So lets keep it non-political and about cars. But since you brought it up we should have had the competancy test back when we elected our last president to office. Remember him? I rest my case. Let’s keep on topic. RF, would you like to say something policy related about this?
Well said Frank – this really needed to be said.
Mark – I think there are not too many TTAC posters that want the domestics to fail or dislike them for some irrational reason. Most, like myself, want them to succeed but have been constantly disappointed and frustrated by their inability to keep Toyota, Honda and even Nissan from taking their market share. However, there are signs of life at GM (less so at Ford and not at all at Chrysler) and some of their new products look to be competitive. I for one a could not be happier – these products will sell themselves and will not need loud, cheesy and jingoistic commercials to guilt Americans into buying them – they will buy them because they want them. Which is how things should be in a market economy.
Mark said [i] “Sadly, most of the posters and editorial staff on this forum are not as open minded. The mere suggestion that they look at a competitive (see Fusion / Aura) Ford or GM product is met with a “how dare you suggest that” disdain….”i would not ever want my friends to see me in an American car” “[/i]
I think that’s a bit of an exageration. Plenty of people on this forum (like many in the country) have had very bad experiences with products from domestic auto manufacturers. These, whether they consist of appalling treatment from the company (or dealer, it’s all the same to most customers), outrageous repair costs, having been exposed to serious safety hazards, persistent problems, can all cause extreme frustration. For these people, it doesn’t matter how good current domestic autos are, as long as they are satisfied with what they currently have.
As for some of the comments you are quoting, I can’t say I even remember reading anything like that here, in editorials or comments.
Mark I disagree with you. My car company is Honda, they produced a great car and I am more satisfied with it than my previous fords. But I also own a Dakota, its very nice, and I am disappointed that my sisters 2000 Dakota has all the problems my 88 had, plus a bunch of new ones that include the possibility of the wheels falling off at while in its first 30,000 miles of ownership. The fact that dodge had to be dragged to court to fix this, and the fact that the new parts also lack a grease fitting disappoint me greatly.
For some people reliability drives more on the decision phase than looks, reviews, colors, 3ed row seats, cup holders, younameit. For me, while I think the Ford 500 is a nice car, comfortable, and you have a nice view of the road. I pay no mind to reviews by any magazine, or website.
For me to consider the 500 for purchase, either new or used, this car will have to have had all the right color circles filled in on consumer reports long term ownership survey. Same for any other car. The 99 Accord is off my list because of its transmission problems. Not cause I think Honda won’t fix it, they have fixed my dads with a smile and no expense for him. I just won’t consider it.
While I made my living in labor for 18 years I can say that a $20,000 investment is not a light one. And I expect the vehicle to last more than 10 years, and have a 100,000 mile “gas and go” period. Honda is the only car I trust for that now. And I will have to see evidence of that dependability in F, GM, C or any other before I plunk down my cash I earned diggin holes to plant trees.
The problem for the US and A manufacturers is that ” the cheap shows through ” and they just don’t last.
later.
Frank, I agree with the notion that the definition of a car’s nationality no longer includes the location of its production or the nationality of the workers assembling it. But you have touched upon and then entirely ignored over a very important part of that definition. “The location of a car company’s headquarters determines its products’ nationality.” This is vitally important and you have dismissed it as irrelevant. At the end of the day, what matters more than where a car was assembled or by whom, is where the revenue and hopefully profits from that car’s sale end up.
The truth about cars is that if you buy Japanese your money supports the Japanese economy and builds wealth for the nation of Japan. If you buy American, your money stays within the United States and builds American wealth.
The truth about cars is that new car buyers buying cars from American companies, regardless of where they are produced, is better for the American economy than spending their money with a foreign company.
The truth is also that American car buyers have amply demonstrated that they are no longer willing to give American automakers a pass on quality and design and are willing to send their money to a foreign treasury. That is their prerogative in our free market economy. Any judgement of that is a political issue and not appropriate for this forum so I will refrain from judgement and ask others to do the same.
Right here on TTAC recently we have seen many examples of cars that the domestic automakers have gotten right, and as an American I have the highest hopes and best wishes that that trend continues. If American automakers disappear we all lose, and an opportunity to make new American wealth is lost.
The auto industry has been guilty for a long time of abusing the patriotism of American car buyers, substituting jingoism for quality and innovation. But in and of itself, there is nothing wrong with asking people to support their national economy rather than another nation’s. Let’s all hope that going forward American automakers do everything they can to earn their American domestic customers loyalty rather than take it for granted. Lord knows they’re going to have no other choice.
well said Brandon. But in a world where the Company is publically held, and holders, in the USA, of Honda stock have for example doubled thier money in the last 2 years, the welth does not necessarally end up entirely in another nations pockets.
But I still give you ten points for your posting. Very well said.
Mark The problem is not whether someone is open minded or not. The domestics have a very hard obstacle to overcome. If someone had purchased a product from a company and was subsequently extremely dissatisfied with the purchase in relation to a subsequent purchase from a competitor, then tell me how many of those same people are going to automatically dump the second companies product to jump back to the original company. There are some who feel that if GM Ford etc make a competitive product that some how automatically that lost market share will return simply because after all GM Ford etc are American.
It is my belief that GM has competitive products. While many on this forum disparage the Cobalt and the Impala. I believe that they are competitive products (hey its my opinion). The problem is that most of my friends and neighbors now have had fantastic experiences with their honda and toyota vehicles and it will be difficult to get those people to even try GM products becasue A) they had a shitty GM or Ford car in the past and B) they had a great Honda or Toyota.
Can anyone blame them? Would it be any different for any other product? Why would it be differnt for automakers?
Also for the record in one of my jobs I work at blue collar union job in Florida. More than half the cars where I work are imports although the majority of trucks are domestic. While no one will cheer the demise of any of the big 3, generally no one outside of Detroit is going to buy a car simply based on national origin. No One.
Best to build on national interest, and not abuse it.
It’s all excuses – first we have the currency manipulation issues (Bank of Japan hasn’t directly affected changes since 2003 and does on a rare event – we are talking the nation of Japan that has almost no natural resources besides it’s people).
Next we have Big 2.5 mentality of built it and people will buy it when Toyota & Honda would travel around the US perfecting the product based on real world customer tastes – then building it properly.
Then we have Big 2.5 excuses that there is a “perceived” quality gap only and not in real life. That’s pretty amazing when you sit in an Aveo and a Honda Fit and compare the two. Or a Cobalt and a Corolla. Get in a Solstice and rev the ecotractor engine then compare it to a Miata or an S2000’s engine. Get real giddy and compare to a Z4 or TT’s engine note. Sports cars are meant to sound like a sports car not just look like them. The Big 2.5 is stuck selling to rental fleets b/c they are the only customers left. Now that they’ve pulled back and rental car companies need cars who will wind up selling to them? Big 2.5 will have to dump its average 1M inventory into the fleets.
Now it’s patriotism – the last bastion of excuses to buy what you sell. And hopefully the last excuse to buy an average or sub standard car.
Mark: I don’t buy into this “posters and editors not being openminded” thing.
The posters and editors have nothing to do with it. If the business is doing the right thing, people will respond.
I only hear GM/Ford whining about how the consumers and the evial media are biased.
Did Toyota/Honda bitch and moan about biased consumers/media in the 70’s when they were trying to overcome their reputation as rustbuckets? No, they did their product do the talking.
Did Hyundai bitch and moan about biased consumers/media while trying establish their reputation after the crap they sold in the 80’s? No, they did the product do the talking.
The odd thing is that, the more Detroit complain about the biased consumers and the media, the more I give them less credibility. Let the damn product do the talking, and not the PR droids! Consumers are not fools, despite what marketing folks think.
It would be interesting to hear more about the alleged currency manipulation – that does seem to be the most recent excuse i keep hearing.
Brandon I have heard those arguments repeatedly and typically when we are asked to remember where the company headquarters is located what they mean is don’y buy Toyota or Honda buy GM, Ford and perversely Chrysler. In almost every case when that argument is raised Chrysler is left out because it is a German based company now.
Better yet I offer you this. Walmart is an American company. It is based in the US of A. The profits go here and build wealth according to your argument. According to you if I buy from Walmart I am supporting the good ol USA. Is that more true than if I buy from 7-11. I beleive that 7-11 was purchased by a Japanese company.
Better yet, If the majority of items at Walmart by and large are made in China but the profits go to Walmart then by your argument this is a good thing. I have never had anyone of those look where the profit goes posters come up with a good counter argument. If buying a Mexican built Ford is better than buying an American made Honda because of where the profits go, then by that same reasoning buying Chinese made goods at Walmart is also a good thing. Yet strangely the same people who post those arguments never seem to agree. Why is that?
Brandon D. Valentine: Frank, I agree with the notion that the definition of a car’s nationality no longer includes the location of its production or the nationality of the workers assembling it. But you have touched upon and then entirely ignored over a very important part of that definition. “The location of a car company’s headquarters determines its products’ nationality.” This is vitally important and you have dismissed it as irrelevant. At the end of the day, what matters more than where a car was assembled or by whom, is where the revenue and hopefully profits from that car’s sale end up.
So if I understand what you're saying, the only thing that matters is if the head office is in America and that they get the profits. Following that line of reasoning, no one should buy a Chrysler or Dodge because ultimately the the revenue from those sales ends up in Stuttgart in the coffers of DaimlerChrysler. That would leave the vehicles made by Ford and GM as our only choice, and it doesn't matter whether the money paid for assembling them goes into American, Korean, or German pockets, so long as the profits from the sales end up in Detroit. I'm sorry, but I can't buy into that line of thought.
Guma is right, If F, GM, and C are making better products, they will have to sit on their current, or falling production numbers until thier products show their stuff. I was surprised to hear in one news report from the detroit auto show that in the new chevy something (sorry don’t remember but its an old name reinvented) in that car they are spending an extra $200. on improved materials for the interior. For me this is almost a Bold Move in admitting they need to improve quality, and yes they still do.
Guma is right, GM, F, and C are where Toyota, Honda, and Hyundai were years ago, now they need to get-er-done!
Brandon: “The truth about cars is that if you buy Japanese your money supports the Japanese economy and builds wealth for the nation of Japan. If you buy American, your money stays within the United States and builds American wealth.”
But what if the Japanese car was designed and built in the US with more US contents than the so called American car?
And also note that it’s not like Japan is some evil empire; it’s one of the best US ally. In addition, it’s in the Japan’s, as well as the Japanese auto manufacturer’s best interest for the US economy to remain strong.
Plus, as Hondaboy said, we can buy ADR’s for the Japanese companies here.
In short, I thought the whole point of Frank’s article is that everything is not as black and white as a lot of flag wavers portray the issue to be.
What we need is for someone (Robert, Frank) to go to a few dealers F, C, GM, H, T, Hy, and do a survey. How informed are customers on origin of parts, assembly, and include customer loyalty, all the topics discussed here. And report back here on it. and respect the fact that they will be able to do it unbiased, and lets see what they say. Lets see just what the average customer takes with them as fas as knowledge goes when they go looking for a car. Maybe this stuff only enters into only a few shoppers minds.
howboutit guys…..
We bought our Honda Accord because we thought it was a better car than anything out there (including GM or Ford products).
I bought my Nissan Maxima because I liked it.
First thing I would do as Dictator of the world is to resign… But before that I would force every auto manufacturer on earth to headquarter on the Principality of Sealand just to quell the nationalistic nonsense… Oh, and before I resigned I would use a cigar on a young intern in a blue dress. (I would not make a good dictator because I have zero desire to kick other people around BTW)
Brandon D. Valentine:
–At the end of the day, what matters more than where a car was assembled or by whom, is where the revenue and hopefully profits from that car’s sale end up.
If your concern is with the economic benefits of automaking to the local economy, this statement couldn’t be further from the truth.
Take a look at the financial statements of your typical automaker (or, for that matter, any large manufacturing company outside of high tech), and you can see that very little of the revenue generated by these companies results in profit. (In the case of GM and FoMoCo, there are currently zero profits, which means that the taxpayer is effectively subsidizing their continued existence.)
Most of the revenues — over 90% — go out the door in the form of expenses. Most of those expenses are spent on components, labor and taxes, in that order. From an economic standpoint, the greatest impacts of those revenues will be felt where the factories are located (that’s where the workers are employed) and where the parts are purchased. Most of those parts will likely be built within a reasonable radius of the factory.
The tiny fraction of money that remains as after-tax profit will largely be reinvested into activities that, if successful, will help the company to grow. Much of that reinvestment goes into new plant and equipment, and acquiring other assets. Some of it goes to the investors in the form of dividends.
Armed with these economic realities, take a step back and look at the implications of this reality:
-The main sources of economic benefit to the greater economy are where the parts come from and where the workers are employed. You’re doing far more for the US economy by buying a US-built Accord or Camry than you would by buying a Korean-built Aveo, Mexican-built Fusion or Swedish-built Saab.
-The main benefit of the profit component comes from the choices made by the automaker to reinvest them. The US gets far more benefit when Toyota, Nissan, Hyundai build a new plant Stateside than it does when GM blows $4 billion on a failed acquistion of FIAT, or when Ford builds a factory in Mexico. And since most of the automakers are publicly traded companies, many of the dividends end up going to institutional investors in the US, Europe and Japan.
Which leads to this: the American automakers have been busy firing workers, shutting down local plants and looking to shift their operations elsewhere, while the “transplants” have been building factories in the US, buying parts made in the US, and hiring Americans who will pay taxes. Where the corporate headquarters is located is largely irrelevant, given that the HQ generates few of the costs and creates relatively few jobs compared to the manufacturing plants.
The automakers are ultimately loyal to no flag. In a world where Mazdas are built in Michigan, PT Cruisers are built in Mexico, and Chevrolets in Europe are rebadged Korean-made Daewoos, the world is not as simple as it used to be.
Adrian Imonti: 10 points! you very clearly see how production based business makes and spends its money. And has a greater impact locally today with Just In Time inventory.
Well said!
Twenty years ago I bought a Ford Taurus. Although it was a decent basic car, it needed further refinement to be truly competitive with the market, and the dealer ‘experience’ was absolutely crap. I wrote to Senior Ford management (Hal “Red” Poling) at the time and suggested they owed this car and the folks who designed an built it the time and money to make it truly world class. It was at the time the best selling car in America. Unfortunately for Ford, they put their money and time into the ’short-term-profit’ Explorer and not into the Taurus. They are living today with the long term results of poor product development.
A few years ago, I had several opportunities to rent a Lincoln LS, another really decent car which needed only slight refinement to be truly competitive in its market. My feelings prompted another letter to senior management at Ford.
Neither of these letters to Ford ever received a response.
My choice, as an American, is to vote with my wallet; every time I’ve bought a new car in my adult life, I’ve looked at the domestic offerings and found that they simply did not deserve my support.
Just as no one would today say that a 1940’s German citizen was ‘unpatriotic’ if they did not support the Third Reich, so to will future Americans see those of us who demanded excellence from our car companies, our manufacturers (and our leaders), yet found it wanting.
Nazi Germany and Stalin’s USSR proved that flag-waving and appropriate action are not the same thing.
Basic transportation includes wheels, engine, transmission, doors, etc. Todays cars are advanced means of transportation. They all include advanced fuel delivery, and management. Brakes are more refined and very precise technical things. Engines now consist of composits, and aluminum alloys, etc.
To call a Taurus a basic car means it passes the engine, transmission, doors test as in “these items are prefected” lets move on. The Taurus failed big time on one of the basics, its transmission was a joke from day one. Chevy made a car in the same time period as the early Taurus, and the doors fell off because they choose to glue them on.
Sorry to say, but many US and A cars fail at just being “basic” in the term basic transportation. Basic transportation is something you can depend on to get you to work. I think its one of those basic expectations from a car in this day that our domestic name plated manufacturers have failed to deliver on.
And yes there are exceptions, and there are the real dogs. But one of the best selling fords of recent times had soooo many disapointing experiences behind it, that they will have to deliver a product not “as good” or even “better than” the transplants, but for many of us will have to be “Much Much Better” than….. to be considered.
Unfair or not, it is what T, H, N, and Hy have delivered as they grew to gain many of our sales and loyalty.
We’ve bought 3 new cars in the past 5 years, as a result of getting married and having kids. The old cars simply weren’t big enough for the job.
Fall 2001: was there a 2.5 budget family sedan with ABS and side + curtain airbag? No. Heck, Chevy was pushing the Impala with just a driver’s side only airbag, something about liability and small front passengers leaning into a side aibag during deployment.
Spring 2004: was there a 2.5 minivan that had side curtain airbags, traction control, ESC, and could hold 8? No.
Winter 2007: was there a 2.5 budget vehicle that could hold 3 large car seats? No.
Two authoritative scholarly articles on the topic – don’t let the dates of publication fool you, they are just as relevant today:
“Who is US?” by Robert Reich, Harvard Business Review (Jan-Feb 1990, pp53-64)
and the response:
“We are US: The Myth of the Multinational” by Ethan Kapstein, The National Interest (Winter 1991/92)
forgot to mention – if anyone wants the text of those articles, email me at (name- all one word) at yahoo.com and I’ll hook you up.
Edgett: “My choice, as an American, is to vote with my wallet; every time I’ve bought a new car in my adult life, I’ve looked at the domestic offerings and found that they simply did not deserve my support”
Brilliant post and my point from the start. If every buyer was as openminded as Edgett (he will look at American Cars), MOVING FORWARD….Ford and GM will be better off. Ford and GM’s responsibility is to make competitive cars….it is my belief that they are currently taking steps in this direction.
As far as balanced reporting in the mainstream press against American Auto companies…I believe it exists. Some of this is deserved given their arrogance during the 70’s-90’s. But come on folks—-if GM had to settle a 3.5 million person class action lawsuit like Toyota recently did for engine sludge—it would be front page NYT and first strory on CBS. Additionally, if GM Rick had to resign in disgrace over sexual harrassment—like the former head of Toyota”s US operations did—-it would have been front page scandal news. It is not media balance when neither of these recent Toyota embarassments did not make the mainstream press.
I love this idea of having an “open mind”.
Yet the very REASON GM and Ford are doing as well (if you wish to call it that) as they are is due to having a CLOSED mind.
The generation which consists of loyalists …those individuals who will buy ANYTHING and of ANY QUALITY which GM and Ford spit out…that generation and warped mindset still exists today!
Just know that that pool of individuals is shrinking. Most of those individuals are in their 60’s and will be dying off shortly.
So, how can GM and Ford (notice I fail to mention Chrysler…they really aren’t worth mentioning, now are they?)…how can GM and Ford ask you to “open your mind”, when the very fact they are still alive and breathing (albeit on life-support) is due to having a CLOSED MIND?
All’s well that ends well…right?
(And it’s all ending quite nicely…Adam Smith himself would be proud).
Mark; not to backtrack on the whole nationalism discussion but While we know the names of our local auto manufacturers presidents, or CEOs. I can say that while my cars of choice are Honda, I don’t know any of the brass over there. And the company headquarters as far as I know are thousands of miles away.
In addition, in the Dakota/Durango story I saw on tv which included the ball joint/wheel collapse recall, The news media was directly involved. The TV story was perhaps covered in more detail because our anchor had one of the cars in question, and had a bad experience with it. It was a local story that was found to be a limited national issue.
My brother has one of those Toyota trucks with the engine sludge problems, and his does not have any sludge.
One reason may be but not only that he is old school 3,000 Mile oil change. He/We also accelerate less than moderately, thus limiting blow by. Same with the Chrysler oil problems, some are fine, many have failed. Some of the media focus is not just the problem, but how its handled. Toyota was taken to court over it possibly in part because engine failures are not as common in toyotas, and as such much less tolerated. They may and most likely were arrogant in their own right because of their standing in reputation. They were rebuked in court and I’m sure they learned from it.
I would imagine the Toyota CEO resignation was in fact front page news in Japan.
Rastus also makes a very good point. Adam Smith wrote the future of our domestic name plated auto manufacturers. Also that guy that was featured on PBS years ago who tried in vein to sell detroit on a quality feeback loop for their companies.
I wish I knew his name or could remember him, but I can’t maybe someone knows and can help out here.
I think it was in the 60’s maybe even earlier.
He wrote a book about new manufacturing principals including problems in design, and constant product quality feedback. Funny he was as I remember American, but found his only audience in Japan.
http://www.amazon.com/Out-Crisis-W-Edwards-Deming/dp/0262541157/ref=pd_bbs_sr_1/104-5850995-8926319?ie=UTF8&s=books&qid=1173033291&sr=8-1
His name is Deming. Back in the late 60’s and 70’s he tried his damndest (is that spelled correctly?) …he tried like hell to sell his message to Detroit.
Nobody would give him the time of day.
So he packed up his stuff and went to Japan.
The results speak for themselves, yes? :)
Arrogance will bite you in the ass every time.
So PLEASE…keep a CLOSED MIND, people, and trot on down to your local Chevy dealer. They NEED more people like yourselves…be good little sheep, hear?
And please…not the title of the book.
GM and Ford…well, they prefer to STAY in their little crises modes…I guess a crisis is their “comfort zone”.
Thank you Deming was his name. now I remember.
Rastus… I lost a set of keys……
That’s ok…losing a set of keys is quite a minor thing.
Losing an entire generation of customers (for life) is quite another story! ;)
Cheers!
American autocompanies should just stick to SUVs and trucks!
Frank – I believe that your article is an excellent rebuttal to the car connection article, which is skimmed through the other day. I disagree that that article even needed a rebuttal. At the end of the day, the real question is: If you buy an “American” car just because you believe that it’s more “American” than some other car, even though it doesn’t deliver the same value, then how are you “supporting” that “American” car company? That’s not support… that’s contempt!
All- Jim Press (you may have seen him lately) is the new head of Toyota's US Operations. He succeeded the former head who resigned due to sexual harassment that occured in the US !! Not surprising that you don't know this as TTAC and the mainstream press did not cover it. I
'm not asking the US mainstream press to be mouth piece patriots for the US auto industry they either recover on their own merit or they die—-I just want balance. Sexual harassment from the Toyota US head—you can hear the crickets chirping. If this was GM Rick—–well you know the rest of the story…it would be the headline on the next TTAC GM Deathwatch
Mark I read about the sexual harassment suit. I also read a lot of claims of media bias on the detroit news website. Having said that I am not sure where you hail from but if you are from Michigan I have an explanation for the “media bias” claim that is often put forth.
I live in Tampa Florida. We have several major theme parks in Orlando and 1 in Tampa (Busch Gardens). Unfortunately every now and then someone is either kiled or maimed at one of these theme parks. Everytime it happens, guess what, it is front page news here in tampa. Likewise when some is killed or maimed at a theme park in Geogia like six flags or Knottsberry farm or Disneyland in California there is only a little paragraph on page 7. This does not mean that the media in Tampa is biased against Busch gardens in and only gives favorable coverage to six flags.
Yet those are the ridiculous claims I always read on other forums. Generally on places like autoblog and of course here and other places you will see equal coverage. If the president of Hyundai is in trouble they post it, If Mark Fields gets a bonus they post it.
Again I do not know where you live or if you have any connection to the domestic car industry. But in my opinion the pity party that many domestic car employees carry on about is not helpful but actually highlights the problems the domestic industry is facing. In all too many cases they do not own up to their own failings and instead come up with scape goats. The media is not the reason people have turned away from the domestic car makers.
Yesterday in response to Consumer Reports release of reccomended reliable cars report GM responded. According to GM their warranty claims are down 40 percent compared to 5 years ago. Now I ask if their warranty claims now are down 40 percent from 2002 then what does that say about the cars that GM was making from 1999 to 2002. Does that not also validate the claims of many that they have had more reliabilty issues with GM than with Toyota or Honda. Yet upon mentioning CR all you hear is “they are biased”. The seeming total inability of the culture of the domestic auto industry to even acknowledge their current shortcomings is astounding. Instead anyone be it a magazine a blogger or just a person is labelled with “Oh you are biased so your opinion does not matter.”
GM Ford etc will only recover if they win back people who do not like their cars. There are not enough domestic loyalists for lack of a better term for them to continue to ignore media or people that voice criticisms.
the
Thank you, Messer. Williams for a thoughtful counterpoint to the propositions put forth by Messer. Witzenburg.
Having such national debates in the media (at least on the ‘Net), is a vitally important part of our democracy.
My comments:
In his article titled “What is an American Car?,” Messer. Witzenburg states:
“…import vehicle makers began achieving serious penetration of this market during the fuel-crisis 1970s…”
The question begs to be asked: How did the foreign auto makers penetrate the U.S. auto market in the early ‘70’s? Could it be that most fuel-efficient cars were more than likely made by companies based off-shore?
Messer. Witzenburg goes on to state:
“Because our domestic makers during the 1980s and ’90s were not especially worthy of protection.”
Translated into plain English (a.k.a. the Truth), this means the U.S. auto makers were building cars that were simply not competitive with some foreign-made cars. Consumers here noticed, and voted with their dollars.
So for thirty long years (the 70’s, 80’s and 90s), many car buyers in the U.S., who valued economical and reliable autos, found what they were looking for in cars made by companies based outside of the U.S.A.
Thirty years, a time span covering what I would define as “prime time” for marketing to the baby boom generation (and sewing the seeds for generations beyond). A time span where, by his own words, Messer. Wizenburg tells us that American-based companies were simply not competitive for one reason (fuel efficiency), or another (product quality).
If we include the late ‘90’s into the 2000’s, when Detroit left the mid-size-, and especially, the small-car market to others, an instead focused on SUVs and pickup trucks, one could argue that the time of ignoring at lease certain market segments expands to four decades, or forty long years. In the marketplace, steadily loosing customers for such a long time span makes overcoming a competitive disadvantage nearly insurmountable.
Finally, near the end of his article, Messer. Wizenburg states:
“And should Americans buy “American” out of patriotism. No, but they should carefully consider U.S.-brand vehicles – now that most are competitive or better in design, engineering, quality, and fuel economy – out of their own economic self-interest.”
Cars now being built by American-based companies may (or may not) be “…competitive or better in design, engineering, quality, and fuel economy…,” but when companies allow 30 or 40 years of opportunity to go by the boards, can you really feel sorry for them?
Compelling as the case may be (i.e. American job counts), the Truth be told, who is at blame? Is it the American consumer, or the companies that ignored the needs of many of their customers for so very long?
I do not think anyone is denying that the US Auto industry is to blame for the mess they are in….nor should anyone feel sorry for them. Car purchases at the end of the day are usually for very personal and self interested reasons.
Mr Wizenburg clearly backs this position:
“And should Americans buy “American” out of patriotism. No, but they should carefully consider U.S.-brand vehicles – now that most are competitive or better in design, engineering, quality, and fuel economy – out of their own economic self-interest.”
“Carefully Consider”—is much different than saying anyone that doesn’t buy american is unpatriotic.