Daily Podcast: Bullet-Proof
Prior to the late 80's, Mercedes were known for its "bullet proof" build quality. Of course, they were no such thing. A well-placed slug would stop a Mercedes just as quickly as a Ford Pinto (although the Pinto might cease its forward motion in a far more spectacular fashion). Actual bullet-proof cars began appearing in the US about the same time Al Capone figured it best not to stain his Cadillac 16's upholstery with the contents of his skull. Initially, bullet-proof cars were fairly basic: a normal car with thick metal plates welded onto the chassis. As bad as this was aesthetically, it was worse for handling– which presented a whole 'nother set of lethal possibilities. Eventually, metalworkers fashioned more elegant solutions; you can now buy an up-armored luxobarge or SUV that looks like a normal luxobarge or SUV. Saying that, human nature being what it is, plenty of buyers still make the mistake of assuming that the ability to withstand ballistic or explosive attack is more important than day-to-day safety, or the ability to escape and evade. Modern automakers would do well to learn this lesson: people want what they want, not what they need– even when it's a matter of life or death. And what I need is a couple of days to rest and recharge. See you on the other side.
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Does anyone else notice the relationship between people wanting to shoot you and driving a Mercedes? *T.I.C.*
Kevin: What would they be penalized for? Standing by and allowing GM to be bankrupted by the dozens of factors cited by every one of the 149 death watches? Why would "political repercussions" be focused on Toyota at all, and not one of the other dozen auto makers that GM failed to compete against? This site is replete with arguments that Detroit has been shooting itself in the foot for decades; why all of a sudden is it Toyota "nuking" them? As something of a pedantic point, they are not maximizing truck prices now. To maximize truck prices, they would set the price of a truck at infinity. If they are not profit maximizing, then they are simply selling either too many units at too low a price or too few units at too high a price. There are lots of things they could be maximizing that aren't profit, such as revenue, slack plant capacity, or market share. In the absence of a strong argument otherwise, it is a safe assumption that a firm is going to endeavor to maximize profit. It is certainly an argument that long-run profit maximization for Toyota involves propping up a failing competitor, but without some substantial proof I do not see why Occam's Razor oughtn't be allowed to reign.