Quote of the Day: Last Domestic Standing Edition

Robert Farago
by Robert Farago
quote of the day last domestic standing edition

Fiat boss Sergio Marchionne has been schmoozing with Automotive News Europe [sub]. “By the time we finish with this in the next 24 months, as far as mass-producers are concerned, we’re going to end up with one American house, one German of size; one French-Japanese, maybe with an extension in the U.S.; one in Japan; one in China and one other potential European player,” Sergio predicts. And now, the WQOTD: “Companies can only survive if they produce at least 5.5 million cars a year.” So, someone special, who will it be? Someone special like… “Toyota, General Motors, Volkswagen, Ford Motor and Renault-Nissan.” Note: we could have gone another way on this one. In the same article, the thoughts of Jürgen Pieper, analyst at Metzler Bank in Germany, gets major play. Herr Pieper opines “Size in the current situation is what matters.” Small and nimble gets subsumed by big and… stupid? Stimt. “Daimler has been scarred by its experience with Chrysler, BMW bought Rover but sold it again after high investments failed to pay off. Analysts say both episodes showed that synergies between premium and volume carmakers are elusive.” “Elusive” as in non-existent?

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  • Tom Tom on Dec 08, 2008

    @Katie: I don't think I agree with you about VW. You're right about Seat. It will get a couple more years, but if it doesn't bring profits soon, Seat is gone. But the rest? Bentley will definitely stay, it doesn't overlap with any of the other brands and it's a nice way of selling otherwise unsellable Phaetons for a much higher price. Lamborghini might go away, but I don't think so. It will probably depend on how this economic crisis thingy works out. But if it gets better by 2010, Lambo will stay. While Lambo and Porsche seem to overlap, I doubt that you'll actually find many cross-shoppers out there. The two marques are just too different. Finally, Bugatti will remain with VW as long as Ferdinand Piech is alive, he'll make sure of that, it's his baby after all.

  • Brianmack Brianmack on Dec 08, 2008
    "So, someone special, who will it be? Robert, have your kids been subjecting you to Higglytown Heroes?

  • Dimwit Dimwit on Dec 08, 2008

    As it's been pointed out, the only way that size matters is in performance. Sheer size will never save anyone. Going down the list of companies and marques it's obvious that Brand is all. Trying to compete against the market you'd better have something besides cold steel on the ground. VW's boutique brands have a following and are probably safe, even Bugatti has brand equity for VW. Watch the refresh though. Should they screwup the Veyron II, Bugatti is toast. Ford has a reasonable mix, as does Renault, BMW, Toyota, Mazda, Honda. GM needs time to get its act together. Diamler needs time to bring back MB to the engineering heydays of the 80's. They also have to streamline. Is Smart viable? Can they make Maybach work and is it worth it? For PSA, Citroen has flavour but their other brands have a distinct me too scent. FIAT has Ferrari. Alfa is the typically Italian gorgeous/horrendous and FIAT itself is just Italian through and through. That's not enough. Partnering will help. Why someone would want to get in bed with an Italian government looks to be a sign of desperation. Tata is all about the money. Cash flow that is. They have stormed onto the int'l market but with heavy debt as an anchor. Should the domestic market falter they will be in trouble. Suzuki is doing very well in niches. They will survive quite nicely. Nissan has Ghosn. He's not going to be there forever and if the house isn't in order by then, it's going to have trouble. One joker in the deck... there are going to be a *lot* of unused assembly plants around the world once the dust settles. A 10 mill unit US market is a blip. It will go up in a matter of years. Will a boutique assembler come out of the wings? Pure mercenary manufacturing? Consider Chrysler without an assembly plant but getting product as needed and just in the quantities needed. Suddenly they're not only viable but maybe stronger than a lot of the traditional fully integrated companies if they can design and market efficiently.

  • Dimwit Dimwit on Dec 08, 2008

    And another thing... (I'm feeling like Dutch Mandel)will all these shenanigans in front of all these governments be the final impetus to get a unified world standard for safety? Or will it take a Ford or GM to say to the Voice from on High that puts out another "standard"; "No."