By on January 24, 2009

General Motors hasn’t made money on its core auto business since 2004 – and did nothing. Same cars, same talk, same mismanagement. GM is in the government’s intensive care, hangs on a the tax payer’s money drip, and still hasn’t changed.

Contrast that to Toyota. Toyota will announce its first operating loss in its history – approx $1.6b, less than GM’s monthly cash burn – and Toyota went to battle stations months before the announcement.

Toyota does everything GM failed to do. They changed the management. Akio Toyoda, grandson of the founder, will take over as president. Even before he’s officially taking the job, Toyota “appears ready to overhaul its entire operations, from development to production to its sales network,” the Nikkei (sub) reports. Nothing is sacred. Plants are idled worldwide. Output is slashed. A few days ago, the company held a meeting in Nagoya that was attended by 1,000 representatives from Toyota dealerships across the country. Toyoda made it clear that he would not hesitate to drastically revise the firm’s domestic sales structure. And that’s just the beginning. More drastic moves are afoot.

Toyoda has created a team of employees charged with devising new corporate visions, including making decisions on future domestic and overseas lineups, production system and sales networks.

While GM is painting rosy pictures about pent-up demand and sales which will soon rebound, Toyota is preparing for the worst.

Total global output capacity for all carmakers is 100m units a year. Actual demand is estimated at about 60 million cars worldwide. According to industry figures, capacity utilization below 80 percent spells trouble. With capacity utilization of 60 percent (and falling) the world’s auto industry is in deep trouble. Again, Toyota alone has excess capacity of more than a million units.

While GM was betting on SUVs and available credit, Toyota aims to take the lead in the industry by introducing not only the most environmentally friendly cars but also budget vehicles for emerging countries and (yes) slick models that can spark young people’s interest in cars.

While GM was fleecing its suppliers and even drove its own Delphi into bankruptcy, Toyota is worried about the health of its suppliers. Toyota has conducted an emergency poll of around 50 parts suppliers, to grasp their fundraising situations. The upshot is that their financial health is rapidly worsening. “We will possibly need to help them secure necessary funds,” said Senior Managing Director Atsushi Niimi, who is in charge of procurement.

While GM coddled the UAW, Toyota slashed most temporary workers, and may let unionized workers go also.

Toyota officially replaced General Motors Corp. as the world’s No. 1 automaker in 2008. At Toyota, this is already regarded as an embarrassing non-event. Everybody knows that the reason is GM’s poor performance, rather than Toyota’s strong results. There were no celebrations at Toyota. Actually, it is an irritation. As the Nikkei says: “Staff are simply left without a new goal to shoot for and a bit weary from frequent changes in production schedules. To raise the morale of its people and suppliers, Toyota needs a new goal other than just “growing bigger” or “becoming No. 1.”

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103 Comments on “GM And Toyota. A Tale Of Two Losers...”


  • avatar
    bluecon

    But GM is first and foremost a life support system for the UAW. Secondary is building vehicles. GM is losing money faster than the government can hand it to them. And now GM has refused the billions the Canadian government offered them.

  • avatar
    tesla deathwatcher

    “A Tale of Two Losers”? Not sure I agree with that.

    Toyota certainly looks better than GM by any measure. GM’s market cap is 2 billion. Toyota’s is 171 billion. GM has $60 billion in debt. Toyota has $40 billion in cash.

    But both companies have lost about the same percentage of sales. That many people around the world have stopped buying cars has sent a shock wave through carmaking, an industry already in trouble.

    I don’t know what the answers for GM and Toyota are. But carmaking has been in trouble for years. As you point out, overcapacity is chronic. Time for a Model Change and The Second Century are two books that give us some ideas of the problems and some possible solutions.

    One hope is that the shift to electric cars may transform carmaking. GM had some good ideas with its AUTOnomy and Hy-Wire concepts. Use a common chassis and put different bodies on top. Moving from those innovative concepts to the Chevy Volt, though, was I think a mistake.

    Interesting times in carmaking.

  • avatar
    oboylepr

    And now GM has refused the billions the Canadian government offered them.

    Hi Bluecon, have you any further info on that? a link perhaps? I find that very interesting seeing as the CAW have been kicking the Harper Government around the place over bailout bucks. Thanks.

  • avatar
    ramccann

    GM turns down $3B gov’t bailout

    By Andrew Mayeda, Canwest News ServiceJanuary 23, 2009

    From the Windsor Star

    General Motors of Canada turned down an offer by the federal and Ontario governments of emergency short-term aid, a move that has stunned some analysts and left negotiations on a highly touted auto bailout in limbo, Canwest News Service learned Friday, Jan. 23, 2009.
    Photograph by: Mike Cassese, ReutersOTTAWA — General Motors of Canada has turned down an offer by the federal and Ontario governments of emergency short-term aid, a move that has stunned some analysts and left negotiations on a highly touted auto bailout in limbo.

    “For reasons that are their own, General Motors has decided not to call upon our short-term aid,” Prime Minister Stephen Harper said Friday in an interview, to be broadcast Saturday on Global TV’s Focus Ontario. “That’s actually good news, but we’re talking to them about longer-term restructuring.”

    Harper and Ontario Premier Dalton McGuinty announced with much fanfare on Dec. 20 that their governments would extend a combined $4 billion in emergency loans to GM Canada and Chrysler Canada.

    At the time, the prime minister said the loans were being offered to avoid a “catastrophic short-term collapse” of the auto industry in Canada and the United States.

    The Canadian plan was supposed to be proportional to a loan package of $17.4 billion US, announced the day before. GM Canada was to receive up to $3 billion of the Canadian loans, while Chrysler Canada was to get up to $1 billion.

    But on Friday, GM Canada spokesman Stew Low confirmed that the company will not be drawing on the Canadian loans for now.

    The company “is continuing our restructuring and has initiated more self-help actions to conserve capital, which has allowed us to take the necessary time to work (in the short term) with all our stakeholders to determine how to complete restructuring needs for long-term sustainable viability,” Low said in an e-mail.

    He said it is “more prudent to work that all through with our stakeholders” before drawing on government aid. “It is anticipated, however, that we will still require the offered assistance, as our ‘self-help’ efforts are for the short term.”

    Auto-industry analyst Dennis DesRosiers said it was “shocking” that GM has refused the emergency loans, considering the importance given to saving the auto industry before the bailout was announced. GM’s withdrawal from the Canadian aid program now puts the company’s production facilities at greater risk, he said.

    “The survival of GM depends on the U.S. bailout. Canada was participating in order to protect Canadian assets, so if they don’t get involved with the Canadian government, then, obviously, Canadian assets are more exposed,” said DesRosiers.

    Industry Minister Tony Clement recently expressed frustration with the pace of negotiations with the two automakers. Both companies have already begun to receive funds under the U.S. bailout plan.

    Clement had given the companies until Feb. 20 to present restructuring plans that would meet the government’s requirements for dispensing aid. Among other conditions, Ottawa had asked the automakers to ensure they could lower their labour costs to the level of their Japan-based competitors.

    Darren Cunningham, a spokesman for Clement, said the company still plans to submit a restructuring plan by the Feb. 20 deadline. He said the government would have to see the company’s request for funding before deciding whether it is still eligible for the money that was offered.

    “What was originally announced on the 20th was for short-term financing. We’ll have to see what happens when they come back,” said Cunningham.

    As for Chrysler, Harper said the negotiations continue. “We’re still negotiating over some particular due diligence requirements before we release the money,” said the prime minister.

    A spokesperson for McGuinty did not immediately return a request for comment.

  • avatar
    mikey610

    The Toyota reaction to current business conditions and their performance can be summed up in one word – accountability. That word is absent from GM’s vocabulary.

    The “it’s not my/our fault” drum is the same one that has been beat inside the walls of the Ren Cen for a long time….

    Okay, maybe one more word comes to mind…proactive. It’s not that GM has necessarily made so many wrong decisions, it’s that the decisions are often 2-3 years too late. Timing of decisions is sometimes just as important as the decision itself.

  • avatar
    mikey

    Wow!That is news.Me thinks that there may be more to this story.With all the hoopala this is truly shocking!Good work on the link,I don’t usually miss shit
    like that.

    Give us you thoughts oboylepr, why In the f–ck would GM Canada say no?

  • avatar
    scartooth

    Here we go again with rhetoric without fact. Lets talk about GMs new future with which they have left all others behind. Lets talk about the electric vehicles and the technology that only GM holds or the number of hybrids that not only out does GM have a fully loaded Yukon Truck that weighs three times the weight of Toyotas closest fuelk saver and matches and exceeds fuel costs with the weight.HMMMMMM Lets talk about the leaps and bounds GM is ahead of all competition in the hydrogen fuel cell field. Gm is going to take over the domestic car market and only the economy is holding them back. The economy has effected all automakers foreign and domestic. If Americans dont have jobs they surely arent going to buy cars. So when the economy turns around you will see the Hyudais and the corollas sinking back to their foreign governments and GM will take over the NEW CAR Market in The USA and around the world. Thats why I will always buy American made vehicles. They provide jobs for Americans and they are the BEST in the WORLD. so, BUY AMERICAN PRODUCTS and keep your jobs at home. P.S. toyota sucks and REMEMBER PEARL HARBOR

  • avatar
    scartooth

    General Motors has contributed more money in taxes to the US government than any other industry since the beginning of time. GM also gives millions in charity. As far as the U.A.W. The members of the U.A.W. have contributed billions of dollars in donations to UNITED WAY,FEED The CHILDREN,TOYS for TOTS and HOMELESS shelters across America, as well as march of dimes, breast cancer, and the list goes on and on. These are decent hard working common people only looking for a fair shake . I dont think asking for fair wages and health care are asking to much. When Gm, Chrysler and Fords ran into this economical crisis that has effected their companies have gave back billions of dollars in health care and sacrificed in order to help. What you fail to comprehend is the UAW and GM have recogniozed that we are ONE and we now work together to futher the company. The old days that you seem to have locked into your mind do not exist anymore in this country. But in the foreign countries that you seem to promote the conditons of slave labor,unregulated pollution,unsafe and unfair wages still exist and this is not what we want in AMERICA. So take yous slave shop auto parts back where they came from because they are no longer wanted here in the USA.

  • avatar
    mikey610

    “P.S. REMEMBER PEARL HARBOR”??? Really?

  • avatar
    scartooth

    Yes thats what I said. In a fair battle with US industries, No foreign industry can compete. They know this and thats why they have resorted to slave shops,unregulated pollution,and they fish our oceans dry and kill whales unempeded. With fair rules they cannot compete. The lobstermen in Maine are losing their jobs and the price of lobsters and fish have gone down to the point that they dont make money. Why, because Japan does not conform to fishing regulations and they dont care how they hurt the oceans so they overfish and kill whales by the hundreds. Yet the Maine Fishermen are only allowed to catch a quota and they have to be a certain size. Wheres the fair trade practices there. Why are these goverments allowed to go unregulated, GREED with no care for anyone but themselves.

  • avatar
    scartooth

    So REMEMBER PEARL HARBOR. because they cheated then and they are cheating now.

  • avatar
    oboylepr

    Thanks Ramccann, that was kind of You.

    Scartooth: What’s Pearl Harbour got to do with it?

  • avatar
    tesla deathwatcher

    I understand the subtitle “A Tale of Two Losers” now. Took me a while. Sorry.

  • avatar
    oboylepr

    Mikey, I have no idea why GMC would turn down the money. It may be because the credit market is a bit more stable on this side of the border or perhaps GM took one look at the strings attached and said no way! I have a feeling it might be because of the strings attached. I would love to know what the Governments wanted GM to do in order to get the cash. The other possibility is that (and I can hardly bring myself to type this as it’s such a horrible thought) maybe GM is going to pull everything back across the St. Clair river.

  • avatar
    SherbornSean

    Scartooth,
    How many shares of GM stock do you own? Because you really should own as much stock as you can in a firm like GM that builds heavy hybrids, feeds the babies, fights Pearl Harbor AND saves the Maine lobster.

  • avatar
    rpol35

    GM has done a lot of very stupid things, we all know that to be true. Nevertheless the constant haranguing about “GM sucks and Toyota is great” is getting really old and ceases to have relevancy. We should be looking forward and not backwards; all this slop is starting to sound like the typical slanted reporting that I have come to expect from the New York Times.

  • avatar
    yankinwaoz

    … provide jobs for Americans and they are the BEST in the WORLD

    Scartooth,
    I assume that the “THEY” in this sentence refers to the jobs and not the products. Yes, having a cushy UAW job where you are paid big bucks not to work and get a fat pension and generous lifetime medical care is sweet.

    Now the products these “jobs” produce speak for themselves. GM/Ford/Chrysler lose more and more market share every year.

  • avatar
    mikey

    I had the same thought oboy.I just can’t imagine
    it.In the days before I retired I walked nearly the entire length of the new Camaro line.Millions
    and millions of dollars in super high tech equipment 14 freaking months to install.Would GM
    bail?The Impala line and the product is too old to move and the Truck plant is going in May.

    Yeah your damn right oboy, they could sell the Camaro line and the stamping plant and leave S.F.A
    in the SHWA.

  • avatar
    baabthesaab

    Scartooth – Please understand that the Maine lobster industry is by and large self-regulated. Yes, they are having a very difficult time, but not because of government regulation. The Maine Lobsterman’s Association (MLA) stipulates size restrictions, etc. and polices it’s own industry. Very well, I might add. Not a bad example for us all to consider.

  • avatar
    lw

    Maybe GM turns down the Canadian $$ if they are planning to exit Canada… Maybe they still sell cars there, but with the exchange rates doing what they are doing…

    In the last year, the Canadian Dollar has increased 21% in value vs. the US dollar..

    Every Canadian GM worker just got a 21% raise… Ouch…

    And this is with the US Dollar making an amazing comeback…

    Btw this is what fixes the US economy.. When the US dollar collapses, say down 40% from current, it becomes cheaper to manufacture here in the US, so jobs start coming back on shore.

    It will take maybe a decade for it to all balance out, but equilibrium will come back.. always does..

  • avatar
    scartooth

    Yes you are correct THE MAINE LOBSTERMEN DO HAVE RESTRICTIONS. THATS MY POINT. THE JAPANESE LOBSTERMEN AND FISHIRIES HAVE NO SUCH RESTRICTIONS THAT THEY ADHERE TO. WE IN AMERICA HAVE RULES AS ISAID AND THE FOREIGNERS UNDERMINE THEM FOR THEIR FINANCIAL GAIN AND AT AMERICANS LOSS.

  • avatar

    Bertel,

    You said that Toyota has a current overcapacity of 1 million units. What are the current excess capacities (assuming the current drop in auto sales is the base line for the next couple of years) for the domestic manufacturers? GM, Ford & Chrysler have been closing plants for decades now. Ford in particular has shed plants during their restructuring, trying to match capacity to demand. Michigan’s lost 400,000 manufacturing jobs since 2000. I’d imagine that steps the US automakers made before the financial events of 2008 already dealt with a good chunk of their excess capacity. I could be wrong. What do you know about the domestics’ overcapacity?

  • avatar
    tesla deathwatcher

    I don’t think GM is going to pull out of Canada. That would take big balls on Wagoner’s part (that he has shown he doesn’t have) and lead to a clash of governments. But you never know.

    On the original post by Bertel Schmitt, I disagree with you, rpol35, and think it is still useful to compare GM and Toyota. Both have lost the same shocking share of sales. But their financial position differs greatly. Financially, GM is in terrible shape and Toyota is in great shape.

    Yet you look at what the two companies are doing, and you would think the reverse. Toyota is reacting to the shock to the market. Treating it seriously. Making changes, big ones. The top guy lost his job, for heaven’s sake.

    And what is GM doing? Not much. Wagoner still runs GM. GM begs for government money and gets it. And then starts putting together a plan. No action, just planning. And waiting for pent-up demand to change the market back and save them.

    The point in comparing the two companies is not to praise Toyota and criticize GM. Instead, the point is to figure out what to do about GM. When a company in good financial health chooses to undergo drastic surgery to fight an illness, a company in poor financial health ought to be told that it must do more, not less.

    In my view, GM needs to follow Toyota in making a management change. Not because Wagoner has been an idiot. He hasn’t. But he needs to go, and someone else needs to be chosen. The times demand that.

    And GM needs bankruptcy. That’s its only choice to survive. Besides praying for a miracle.

    Otherwise GM’s poor financial health dooms it. No one will buy GM’s stock. No one will lend GM money. (What the US government calls a “loan” is worse than the subprime loans that got us into this mess — it’s a subsubsubprime loan.) GM has no cash. It’s sick.

    As part of bankruptcy, GM has to slash workers, close plants and brands, and cut costs to the bone, and then some. This kind of surgery is painful, and dangerous. It may kill GM, as weak as it already is. But unless this surgery is done, GM dies.

    Yes, these things have been said many times on TTAC. But I think it is useful to do it again, as Bertel Schmitt has done, by telling a tale of two losers. Deciding what to do with GM is important to the US. Let’s do it right.

  • avatar
    scartooth

    I want to know why the FINANCIAL INSTITUTIONS WONT TURN IT DOWN. I also want to know why The USA wont put restrictions on the foreigners that ship their inferior products made by slave labor and manipulated monetary systems in order to undermine America are nor stopped. I also want to know why so many Americans have not seen and heard these truths from the media.

  • avatar
    Usta Bee

    We don’t have to worry about foreign countries undermining the United States. Corporate America is doing a fine job of that all by itself by outsourcing production overseas in order to make a quick buck, and to satisfy their Wall Street investors in the next quarter’s earnings reports.

    Don’t buy any Mexican built American cars either, REMEMBER THE ALAMO !.

  • avatar
    scartooth

    You are correct and when I thought that I was the only one that was researching the facts. But I have to watch what I say. I have been WARNED by the EDITOR that my comments were not congenial to the ears of his patrons, and therefore I APOLOGIZE to those that I have offended. Also He says that I have been repeating myself. I didnt realize that I was repeating myself do to everytime I read something it seems to be slanted against American Industries and I tend to try and straighten out inconsistencies when I see them everytime. So I will not be repeating that I think thats its UNFAIR that foreign industries MANIPULATE their monetary systems and have underage slave labor,or unregulated fishing industries and pollute unimpeded all in order to undermine AMERICAN businesses. So I apologize once again for repeating myself but not for my thoughts and I hope that all of you will please forgive me.

  • avatar
    mikey

    I’ll forgive you scartooth.Even though Canada and the USA havn’t had a war since 1812.

  • avatar
    scartooth

    I consider Canada and USA as one and the same. We have same rules and regulations to adhere to. Thank you for forgiving me anyhow. I feel much better.

  • avatar
    v65magnafan1

    Re: Canada

    I don’t know why GMC refused the Canadian bailout, but I do know this:

    The Canadian plants are the most efficient and highest quality plants GM has in North America.

    The Canadian market is about the same size as that of California. GM pooched the California market. Do they want to lose Canada? Who will buy a GM product if they abandon ship?

    Interesting angle, though. I’m anxious to get the story. Ontario is as dependent on autos as is Michigan. It does have Honda and Toyota plants as well as FoChryGM, however.

  • avatar
    scartooth

    We dont know what the agendas are yet? But I am sure we will find out.

  • avatar
    tom

    scartooth, you’re not researching the facts, you’re drinking the cool aid.

    Just look at the facts and stop whining:

    1) Government aid: The only country that has given money to their manufacturers so far is the US. First $25b for “retooling” and now the bailout.

    2) Currency manipulation: Again, look at where the FED’s interest rates are. Look at the exchange rates. The Dollar is constantly losing ground while Euro, Yuan and Yen are overpriced.

    3) Unregulated pollution: The US is still the only western economy that hasn’t signed Kyoto. Also, the US is THE major polluter of the earth if you look at the numbers per person.

    4) Slave labor: Just go to Walmart if you want that. In the US, labor costs might be pretty high (although probably not higher than in Japan or Europe). But that’s a social matter. Either it’s worth it and you can compete, or you’re too expensive. It’s that simple.

    5) Buy American: If you want to keep as much production in the US as possible, then you’re right. But if you want your economy to grow as much as possible, then you’re wrong.
    Think about this: Let’s say you want to renovate your house. You can either do it yourself and spend a year exclusively on renovating it, or you pay a company that will do that for you while you work at your job and earn more money within that year than you pay the company.
    Exporting manufacturing jobs works the same way. You do it, because it’s cheaper to let others do the manual labor while you’re getting paid better with a different job.

  • avatar
    tom

    BTW, Great article Bertel.

  • avatar
    SherbornSean

    tom,
    Great post! Have you considered teaching Econ 101?

  • avatar
    oboylepr

    Happy retirement Mikey!

  • avatar
    scartooth

    The only problem with your Thoery is it doesnt makes sense. If I was to export all the manual labor and basically give all manufacturing away. Then there would be a surplus of people without jobs in my area and they would not have monies to purchase the product that I am now IMPORTING. Which is now happening. OH and guess what genious. WALMART will go out of business also because there will be noone with any jobs to buy even the cheapest of products.

  • avatar
    DanM

    TOM: “3) Unregulated pollution: The US is still the only western economy that hasn’t signed Kyoto. Also, the US is THE major polluter of the earth if you look at the numbers per person. ”

    And where does it come in if you look at numbers per GDP? In the context of this discussion, polution per vehicle produced is the relevent metric. (which is not to say that the USA shouldn’t join Kyoto/successor)

  • avatar
    scartooth

    Ok I have thought it through.
    First I will export all my jobs for cheap unregulated labor.
    Second- Layoff and close all plants and office buildings.
    Three-foreclose on all homes of those that lost there jobs.
    Then after I have totally shut down my area and confiscated all possible assets. Then after much starvation and economic turmoil.
    I can then rehire new employees for virtually nothing and resell the homes I foreclosed on.
    Well I think someone has already thought of that with no ethics and with no regard for human beings.

  • avatar
    tom

    @SherbornSean:

    Thank’s but no thanks ;)
    While I took some econ classes, others are probably way more qualified.

    @scartooth:

    Well, this is really econ 101. If you have a lot of unemployed people, there’s a higher demand for jobs, which means that prices (in this case wages) will go down and manufacturing jobs will be more competitive. So in order to keep with my analogy, all of a sudden you won’t earn more in your other job (or you don’t have one), so you’ll renovate your house yourself.

    A job is basically nothing but a regular transaction. The employee thinks that the money he gets is worth more than the time he invests, while the employer thinks that the employee’s time is worth more than the money he spends on him. If one of those two wouldn’t think that way, the job wouldn’t exist.

    In a country with high wages, it’s usually too expensive to have a big manufacturing sector – employees wouldn’t accept the wage necessary for the job to be competitive, while employers won’t pay the price employees want because they won’t get a return of investment. If you want a big manufacturing sector, wages have to go down.

    If the current crisis leads to high unemployment, then people will on average accept lower wages and make many jobs in the US competitive again. But, every country should still aim to get the better jobs anyway. Manual labor is neither a nice nor a valuable (in terms of money) thing to do. In any case, a free market regulates itself and going for the best deals will ultimately benefit the economy more than just “buying American”.

  • avatar
    oboylepr

    While GM was fleecing its suppliers and even drove its own Delphi into bankruptcy, Toyota is worried about the health of its suppliers. Toyota has conducted an emergency poll of around 50 parts suppliers, to grasp their fundraising situations. The upshot is that their financial health is rapidly worsening. “We will possibly need to help them secure necessary funds,” said Senior Managing Director Atsushi Niimi, who is in charge of procurement.

    This is one area where the fundamental ethics of both automakers is in stark contrast. GM (and they are not the only one of the D3) has pursued a policy of what I think is totally unethical behaviour with it’s supply base.

    One would think that when you ‘partner’ with a manufacturer to supply you with major parts or subassemblies that you would do everything reasonable to nurture that partnership. Not GM, it would seem that they go out of their way to poison it in any and every way possible.

    Small example: GM had a RIM (reaction injection moulding) operation in it’s Oshawa North plant which made facias for GM’s Lordstown Ohio plant (sunfire/cavalier days). Quality was bad and scrap rate was near 50% but Lordstown accepted everything that came out of the Oshawa North Plant because it was a GM facility.

    GM sold the North plant, one other Canadian plant and two US plants to a startup operation called Peregrine Inc. Everyone became Peregrine employees overnight. Lordstown knew well what the engineering and production issues were with the manufacturing of the facias but immediately began rejecting a much higher percentage of the parts as substandard. It backfired on them because it caused parts shortage line shutdowns on their line.

    Simply because the Oshawa plant became an outside supplier GM started to treat Peregrine like crap even though they knew that when they had the plant, they could not fix the issues themselves. Just one of many examples. BTW, that RIM plant and a huge metal stamping facility, power house and water treatment facility that occupied many many acres of real estate in Oshawa are all gone and a chapter of Oshawa’s industrial history is finished.

  • avatar
    tom

    @DanM

    A quick Google search provided me with the numbers from 2000 and the US was 9th on CO2 emission per GDP. Yet, it was still first among the major industrialized countries:
    http://tinyurl.com/c5z6hu

    Anyway, the average American is the biggest polluter on earth, which in my view is the more relevant number and it’s hence simply wrong to blame others. But I don’t want to start a discussion about this point either. Even if you take the pollution per GDP numbers, it’s wrong to call out others on polluting.

    The US is definitely not among those nations who burden their economic development with ecological legislation.

  • avatar

    tom :

    1) Government aid: The only country that has given money to their manufacturers so far is the US. First $25b for “retooling” and now the bailout.

    So far, perhaps, but not for much longer.

    The government aid package, expected to total nearly $8 billion in loans for automakers and their suppliers, could be finalized early next month. The plan would make it easier for the financing arms of Renault and PSA Peugeot Citroen to obtain credit guarantees. The plan also will include an expansion of credit to consumers. Already, France has instituted a scrap program that gives consumers 1,000 Euros for ditching their old car for a new, low-emissions one.

    3) Unregulated pollution: The US is still the only western economy that hasn’t signed Kyoto. Also, the US is THE major polluter of the earth if you look at the numbers per person.

    Western, perhaps, but since China is increasingly the source for most manufactured goods I think your point is a dodge. Kyoto has more to do with restraining US economic growth than preventing pollution.

    As for the US being the worst polluter “per person” that’s also a dodge to avoid dealing with China, that has 4 or 5 times our population. Does the US pollute? Hell yeah. Is it also the most productive economy in the world? Yep.

    I’m sure in terms of pollution per GDP, the US rates pretty low. Wealthy countries tend to be cleaner places. The world’s most serious environmental problem is clean water. Studies show that in the developing world, when per capita income reaches about $600 year people start being concerned with having clean water. Pollution is much worse in China, Eastern Europe and Russia than in the US.

  • avatar
    Patrickj

    scartooth:

    Evey one of your posts brings me a small step closer to buying a brand spanking new, Made in Japan, Toyota Prius.

  • avatar
    PeteMoran

    @ Bertel

    Great summary. I’ve had the pleasure of working with various Toyota people and divisions over the years. The corporate culture is innovative, supportive and as mikey610 says, accountable.

    I would however disagree that Toyota people have “goals”; they just know what to do and they all talk about “it”. It’s about respecting your neighbor (work mate or supplier and customer).

  • avatar

    The US is definitely not among those nations who burden their economic development with ecological legislation.

    Do you have any idea how many tens of thousands of pages of environmental legislation the US has at both the state and federal levels? Hell, there are thousands of pages of federal regulations just on the transportation of hazardous materials. CFR 49 is the size of a phone book.

    There’s an alphabet soup of regulatory structures, EPA, RCRA, SARA etc at the federal level plus state EPA and natural resource agencies. I managed waste streams for an DuPont automotive paint r&d and most of my job involved complying government regulations one way or another. The fines for improper paperwork could be $1 million or more. Improper disposal could lead to criminal penalties. With all due respect, sir, you don’t know what you’re talking about.

  • avatar
    robert_h

    Great editorial. The contrast between Toyota and GM in bad times has been stunning. The difference in how the two treat their suppliers is especially stark.

  • avatar
    tom

    @Ronnie:

    The main point of my reply was to show that scartooth was doing nothing but drinking the kool aid.

    His point was that the US manufacturers have major disadvantages compared to the rest, that have nothing to do with how the respective companies are run, but rather with global circumstances.

    So even if France pays its car makers some money in the future, it still doesn’t change the fact that so far the US car makers are the only ones who have gotten any money and that the amounts in play here are WAY higher than anything the French are even thinking about. So this surely can’t be blamed for the troubles the Detroit Three have. Also, I think the EU won’t like the French program either, so lets just wait and see if it ever actually passes…

    As to your second point about pollution, I had a good laugh.

    Kyoto has more to do with restraining US economic growth than preventing pollution.

    Come on, do you really believe that crap? Let me remind you that most countries in the world have actually signed this thing. Now I’m not saying that I’m a big fan of it, but the point is that those countries are willing to pay the price for less CO2 emissions, while the US isn’t. So if anyone is restraining others, it’s the US by not participating. Had the US joined, they would have been on an even playing field with the rest of the world and not being restrained.

    And as I posted above, I don’t see why you consider the “pollution per person” a dodge. Yeah, China has more people, so what? But if you click on the link I provided, then you’ll see that even if you look at CO2 emission per GDP, the US is in front of China, Western Europe and Japan. Only Eastern Europe and the Middle East are worse.

    But again, I don’t want to play the blame game, I only want to point out that the notion that the US is hindered by ecological legislation is ludicrous.

    As for your last point, CO2 is the only major pollutant (since CFCs seem to have been dealt with) we know of that has a global impact. If China is poisoning its water, then it’s their problem. It’s a matter of valuing things. We usually value life rather highly and we don’t like to get poisoned, so we pay more money for protecting ourselves.

    BTW, China has done a lot in recent years to deal with these problems and they are now not far behind western countries in terms of legislation. It’s mainly a matter of actually translating the law into common practice. But when you see that the guys who were responsible for the poisoned baby food received capital punishment, you can imagine that China is serious about these things and that they’ll eventually catch up.

    Also, let’s not forget that this is still a discussion about cars, and China isn’t a real competitor just yet. They are Germany, France, Italy, Japan and Korea. These countries are at least on par and probably above the US when it comes to ecological legislation.

    So again, you definitely can’t blame ecological legislation for the troubles of the American auto makers.

  • avatar
    tom

    Do you have any idea how many tens of thousands of pages of environmental legislation the US has at both the state and federal levels? Hell, there are thousands of pages of federal regulations just on the transportation of hazardous materials. CFR 49 is the size of a phone book.

    There’s an alphabet soup of regulatory structures, EPA, RCRA, SARA etc at the federal level plus state EPA and natural resource agencies. I managed waste streams for an DuPont automotive paint r&d and most of my job involved complying government regulations one way or another. The fines for improper paperwork could be $1 million or more. Improper disposal could lead to criminal penalties. With all due respect, sir, you don’t know what you’re talking about.

    I guess I should have included “compared with their competitors”. I thought this went without saying. I was wrong.

  • avatar
    tesla deathwatcher

    Interesting discussion.

    Let me add two unrelated points.

    First, Japan is reportedly preparing an $11 billion carmaker bailout.

    Second, the Kyoto agreement has been a bust. The developed countries that signed the agreement have, on average, done worse than the United States in reducing carbon dioxide output. The current economic turmoil has done much more in reducing carbon dioxide than anything else that has been done.

  • avatar
    PeteMoran

    @ tesla

    Second, the Kyoto agreement has been a bust. The developed countries that signed the agreement have, on average, done worse than the United States in reducing carbon dioxide output.

    I can’t believe you seriously wrote that and I think you ought to post a source for that claim.

    I was an observer at the Dec 07 Bali Kyoto Conference, and while achievements were lower than expected for their agreements, almost every country has out performed the USA. Quite frankly, the USA has done next-to-nothing.

  • avatar
    niky

    Western, perhaps, but since China is increasingly the source for most manufactured goods I think your point is a dodge. Kyoto has more to do with restraining US economic growth than preventing pollution.

    Ronnie, this is every single third world country’s excuse not to follow international agreements on pollution. They claim that it is the westerner’s way of ensuring the “uncivilized rabble” don’t catch up with their industrialized status. I’m more than slightly surprised to hear it being invoked on America’s behalf… :-p

    —-

    Artificial currency manipulation… the US dollar is one of the most stably pegged currencies in the world… and if you haven’t noticed, the Yen is going up because Japan can’t keep it pegged anymore. The problem with US manufacturing isn’t just the currency and the high standard of living… since non-US companies successfully manufacture there… it’s the impossibly difficult cost-structure of the Big 2.2 and unionized wages.

    —-

    It’s sad that the industry as a whole has come to this, but if the carpocalypse weeds out companies like GM and replaces them with more efficient ones (hopefully a US-based management that isn’t hopelessly muddled in an almost Soviet-style beaurecracy), then maybe we’ll be left with a much better auto-industry for it.

  • avatar
    Bridge2far

    Here we go again. Let’s compare everything to GM. The almighty sacred Toyota (Japan) can do no wrong. Americans, be shameful of your manufacturing! Just keep sipping the Nipponese Kool Aid…

  • avatar
    tesla deathwatcher

    Pete Moran, I got my information from the book An Appeal to Global Reason: A Cool Look at Global Warming, by Nigel Lawson. A book with a bias, to be sure. But I think reliable.

    I agree with you that the United States has done next to nothing designed to curb carbon dioxide emissions. But I don’t think any country has found an effective way to reduce carbon dioxide emissions. That’s my point.

    It sounds like you know much more about this than I do, so I’ll withdraw my comment. Not really relevant anyway.

  • avatar
    PeteMoran

    @ Bridge2far

    Here we go again. Let’s compare everything to GM. The almighty sacred Toyota (Japan) can do no wrong. Americans, be shameful of your manufacturing!

    If many in the USA were prepared to be constructively critical rather than apathetic (or is it arrogant?), maybe you wouldn’t find yourself the financial and manufacturing laughing stock of the rest of the world.

  • avatar
    John Horner

    “Lets talk about the leaps and bounds GM is ahead of all competition in the hydrogen fuel cell field.”

    Hmmm, don’t tell that to the people who are driving Honda Fuel Cell powered cars (FCX) around in Southern California right now.

  • avatar
    no_slushbox

    REMEMBER THE RAPING AND PILLAGING OF THE VIKINGS; DO NOT BUY VOLVO OR SAAB.

    These comments just demonstrate more of the proud to be stupid attitude of the Detroit automakers.

    This article provides a roadmap to success for GM. It is constructive criticism.

    If the response to “here are some ways that another company does things better” is “wah, wah, stop picking on me even though I’m sucking up billions of taxpayer dollars for a company with a non-viable structure” then there is no hope.

    Look to the UK to see what happens to mismanaged automakers with crappy employees. The “we have to save the jobs” argument will work for a while, but eventually the government will tire of the BS and sell it all off to India and China.

  • avatar
    Droid800

    Bertel-

    While I agree with most of what you said, your inclusion of the dealer issue is a non-starter. Franchise laws in the US effectively ban GM from having any direct control over dealers, short of killing brands completely. (which guarantees lawsuits against GM by the dealers) GM is pretty helpless when it comes to dealers, and they can’t do much except nudge them to close shop.

  • avatar
    Luther

    Saying CO2 is a pollutant is like saying Oxygen is a pollutant…Where do you people get this “CO2 is pollution” crap? TV? Your criminal politicians/Journalists?

    The USA is by FAR the least polluter…Cars have actually been CLEANING the natural air of CO, HC, NOx since the early 90s EPA regs. (Mother Nature is a filthy bitch that refuses to wear her cataylitic converter)…With the EPA 2007 regs, one cannot even kill themselves with tailpipe emissions anymore.

  • avatar
    shaker

    CO2 isn’t a “pollutant” as long as we have enough trees to soak it up OH WAI

    Greed and the idea that “double-digit” corporate growth is the norm is why we’re in the mess that we’re in.
    Growth should be moderate and realisitc, lest we fall into a death spiral of outsorucing and shaky investments OH WAI

    Growth should be based on offering quality, reliable products, rather than blowing whichever way the (marketing) winds take you…

    Yes – OH WAI

  • avatar
    Geo. Levecque

    The ravings of scartooth remind me of another person, that would be Hitler in Germany in the thirty’s ,this is from another Canadian too, the Canadian and US requirements for Trade are not the only two Countries in the World, have you not heard of the European Union?
    Canada is very different than is the USA in so many ways, also a lot smaller and for years Canadians have had to accept lousy Automobile products from the Big 3 like you Americans have had too as well, it was only when Asian makers decided to come into North America with there Vehicles that things began to change for the better for all of us.
    Your ex President Mr. Bush decided to get Money for many things and where did he go for this “Money” China and Japan, so please dont blame these Countries, place the blame where it belongs!

  • avatar
    golden2husky

    With the EPA 2007 regs, one cannot even kill themselves with tailpipe emissions anymore.…

    Talk about drinking the kool aid. I would say , please give it a try and let us know, but I don’t want to read about you in the paper.

    It is true that on some days of bad air quality, measured pollutants in the air exceed some of the levels allowed by tailpipe regs, but that pesky CO will kill you every time…

    I am not 100% sure here, but I thought the change in emission standards were mostly for reducing cold start emissions and time of operation in open loop mode…

  • avatar
    carnick

    This is one of the greatest responses to the requests for bailout money.

    As a supplier for the Big 3 this man received the following letter from the President of GM North America requesting support for the bail out program. His response is classic, and has to make you proud of a guy who tells it like it is.

    (This letter is so good I might re-submit it to other threads as well – maybe the powers that be at TTAC might like to post it as a stand-alone?).

    =================================================
    Dear Employees & Suppliers,

    Congress and the current Administration will soon determine whether to provide immediate support to the domestic auto industry to help it through one of the most
    difficult economic times in our nation’s history.

    Your elected officials must hear from all of us now on why this support is critical to our continuing the progress we began prior to the global financial crisis. As an employee or supplier, you have a lot at stake and continue to be one of our most effective and passionate voices. I know GM can count on you to have your voice heard.

    Thank you for your urgent action and ongoing support.

    Troy Clarke President General Motors North America

    ==================================================
    Response from:

    Gregory Knox, Pres.
    Knox Machinery Company
    Franklin, Ohio

    Gentlemen:

    In response to your request to contact legislators and ask for a bailout for the Big Three automakers please consider the following, and please pass my thoughts on to Troy Clark,
    President of General Motors North America.

    Politicians and Management of the Big 3 are both infected with the same entitlement mentality that has spread like cancerous germs in UAW halls for the last countless decades, and whose plague is now sweeping this nation, awaiting our new “messiah”,
    Pres-elect Obama, to wave his magic wand and make all our problems go away, while at the same time allowing our once great nation to keep “living the dream”… Believe me folks, The dream is over!

    This dream where we can ignore the consumer for years while management myopically focuses on its personal rewards packages at the same time that our factories have been filled with the worlds most overpaid, arrogant, ignorant and laziest entitlement minded
    “laborers” without paying the price for these atrocities…this dream where you still think the masses will line up to buy our products for ever and ever.

    Don’t even think about telling me I’m wrong. Don’t accuse me of not knowing of what I speak. I have called on Ford, GM, Chrysler, Delphi, Kelsey Hayes, American Axle and countless other automotive OEM’s throughout the Midwest during the past 30 years and what I’ve seen over those years in these union shops can only be described as disgusting.

    Troy Clarke, President of General Motors North America,
    states:

    “There is widespread sentiment throughout this country, and our
    government, and especially via the news media, that the current
    crisis is completely the result of bad management which it certainly
    is not.”

    You’re right Mr. Clarke, it’s not JUST management…how about the electricians who walk around the plants like lords in feudal times, people wait on them for countless hours while they drag ass… they can come in on the weekend and make double and triple time..
    for a job they easily could have done within their normal 40 hour work week. How about the line workers who threaten newbies with all kinds of scare tactics…for putting out too many parts on a shift…and for being too productive (We certainly must not expose those lazy bums who have been getting overpaid for decades for their horrific underproduction, must we?!?)

    Do you folks really not know about this stuff?!?

    How about this great sentiment abridged from Mr. Clarke’s sad plea:
    “over the last few years…we have closed the quality and efficiency gaps with our competitors.”

    What the hell has Detroit been doing for the last 40 years?!? Did we really JUST wake up to the gaps in quality and efficiency between us and them? The K car vs. the Accord? The Pinto vs. the Civic?!? Do I need to go on? What a joke!

    We are living through the inevitable outcome of the actions of the United States auto industry for decades. It’s time to pay for your sins, Detroit.

    I attended an economic summit last week where brilliant economist, Alan Beaulieu, from the Institute of Trend Research, surprised the crowd when he said he would not have given the banks a penny of “bailout money”. “Yes, said, this would cause short term problems,” but despite what people like politicians and corporate magnates would have us believe, the sun would in fact rise the next day… and the following very important thing would happen… where there had been greedy and sloppy banks, new efficient ones would pop up…that is how a free market system works…it does work…if we would only let it work…”

    But for some nondescript reason we are now deciding that the rest of the world is right and that capitalism doesn’t work – that we need the government to step in and “save us”…Save us my ass, Hell – we’re nationalizing…and unfortunately too many of our once fine nation’s citizens don’t even have a clue that this is what is really happening…But, they sure can tell you the stats on their favorite sports teams…yeah – THAT’S really important, isn’t it…

    Does it ever occur to ANYONE that the “competition” has been producing vehicles, EXTREMELY PROFITABLY, for decades in this country?… How can that be??? Let’s see… Fuel efficient… Listening to customers… Investing in the proper tooling and automation for the long haul…

    Not being too complacent or arrogant to listen to Dr. W. Edwards Deming four decades ago when he taught that by adopting appropriate principles of management, organizations could increase quality and simultaneously reduce costs. Ever increased productivity through quality and intelligent planning… Treating vendors like strategic partners, rather than like “the enemy”… Efficient front and back offices… Non union environment…

    Again, I could go on and on, but I really wouldn’t be telling anyone anything they really don’t already know down deep in their hearts.

    I have six children, so I am not unfamiliar with the concept of wanting someone to bail you out of a mess that you have gotten yourself into – my children do this on a weekly, if not daily basis, as I did when I was their age. I do for them what my parents did for me (one of their greatest gifts, by the way) – I make them stand on their own two feet and accept the consequences of their actions and work through it. Radical concept, huh…
    Am I there for them in the wings? Of course – but only until such time as they need to be fully on their own as adults.

    I don’t want to oversimplify a complex situation, but there certainly are unmistakable parallels here between the proper role of parenting and government. Detroit and the United States need to pay for their sins. news people – it’s coming whether we like it or not. The newly elected Messiah really doesn’t have a magic wand big enough to “make
    it all go away.” I laughed as I heard Obama “reeling it back in” almost immediately after the final vote count was tallied…”we really might not do it in a year…or in four…” Where the Hell was that kind of talk when he was RUNNING for office.

    Stop trying to put off the inevitable folks… That house in Florida really isn’t worth $750,000… People who jump across a border really don’t deserve free health care benefits… That job driving that forklift for the Big 3 really isn’t worth $85,000 a year… We really shouldn’t allow Wal-Mart to stock their shelves with products acquired from a country that unfairly manipulates their currency and has the most atrocious human rights infractions on the face of the globe…

    That couple whose combined income is less than $50,000 really shouldn’t be living in that $485,000 home… Let the market correct itself folks – it will. Yes it will be painful, but it’s gonna’ be painful either way, and the bright side of my proposal is that on the other side of it all, a nation that appreciates what it has…and doesn’t live beyond its means…and gets back to basics…and redevelops the patriotic work ethic that made it the greatest nation in the history of the world…and probably turns back to God.

    Sorry – don’t cut my head off, I’m just the messenger sharing with you the “bad news”. I hope you take it to heart.

    Gregory J. Knox, President
    Knox Machinery, Inc.
    Franklin, Ohio 45005

  • avatar
    Terry

    Scartooth, one item you have not discussed is why US consumers–AMERICANS–freely choose to purchase imported cars instead of the domestic product.
    You can talk about trade agreements, unfair playing fields(as if this is some sort of a game and not a business),workers this or that, but in the end, it ALWAYS comes down to meeting or exceeding the expectations of the customer.
    In many cases the domestic product cost less than the import, so tell us–why do people purchase the imports instead of the domestic??

  • avatar
    Happy_Endings

    Slow learners, but with the onset of these sub-par products as poisoned pet foods,lead in toys,killing of whales and unregulated fishing and child slave labor,The WORLD is WAKING up to their tactics.

    So I guess the recent salmonella outbreak in peanut butter is because of those Asian peanuts?

  • avatar
    Bridge2far

    “If many in the USA were prepared to be constructively critical rather than apathetic (or is it arrogant?), maybe you wouldn’t find yourself the financial and manufacturing laughing stock of the rest of the world.”

    Just remember this. No matter what insignificant country you may come from, you rely on the US.

  • avatar
    mikey

    @Bridge2far Well said! As Canadians we are very fortunate to have a friend and a neighbor such as the United States of America.

  • avatar
    mel23

    “In the last year, the Canadian Dollar has increased 21% in value vs. the US dollar..”

    Not really. As of 1/25/08 the US$ was worth 1.01886 C$. Today a US$ is worth 1.23170 C$.

    An alarming fact is the very large and fast cut backs several large corporations have made in response to the economic situation: Toyota stopping work on their Miss. plant and DOW announced in early December they were closing 180 plants. Not reduce shifts, just shutting them down. They see this a a long haul. It’ll be interesting to see how the D3 plans respond to the same situation seen by successful companies.

  • avatar
    Pch101

    What you fail to realize is that GM, FORD and Chrysler has plants in almost every State of the UNION

    I know that. I’m just in denial, depressed that we couldn’t defeat the problem at its roots and keep it contained.

    Actually, I’m being sarcastic. Detroit doesn’t make the best CARS in the world, and Detroit doesn’t come close to making the best cars in the world, either. There is no way that they will improve when the Detroit Defenders can’t admit that their products are second rate. The first step to recovery is admitting that there is a problem…

  • avatar
    Monty

    Wow, there’s some people commenting above me that have obviously sipped some of Brother Jim’s Kool-Aid.

    The truth about GM is simple. While other companies reacted to the market, GM did nothing. While other companies revamped product and manufacturing, GM did nothing. While other companies drastically restructured (hello Ford), what did GM do? Nothing.

    Any moves that GM made were short term prop-up-the-share-price gambits to mollify investors.

    For forty years it’s been obvious that GM had to shed dealers, divisions and overlapping product, ineffective management and excessive labour costs. What did GM do? GM trimmed labour costs. That’s it.

    Compare GM with their competitors all day long, but the essential facts are that GM has done nothing proactive and has resolutely refused to deal with the core issues that have been simmering for decades. Regardless of what competitors have done or not done, and regardless of all other factors this is the truth of the matter. GM has not done what it needed to do. Is it Toyota’s fault that GM did nothing? Is it the fault of the Japanese Government? Does the blame lie at the feet of the UAW? No to all of those. GM has had forty years to deal with some of these issues, and have done nothing.

    I will be replacing our oldest vehicle within a few years, and looking for a small fuel efficient car that will be reliable, cheap and well appointed. Guess what, GM and Chrysler don’t have anything current or in the pipe that matches that description. Who does? ALL of the Asian manufacturers, and Ford. What am I going to look at first? The Ford Fiesta, because I truly believe that Ford “gets it”. They may not get my sale, but at least they will warrant a look. How many other people like me (Mr. Joe Median), when they finally decide to replace their current ride, are going to pass by GM because they will still have nothing to offer?

    GM only has themselves to blame, and when I say themselves, I mean the Board of Directors and the executive officers.

    Sorry about the rant, but I just can’t believe that so many people are still blindly supporting GM and blaming every other factor other than those who so richly deserve the blame.

    When GM decides to build reliable and competitive products that soundly compete with others, I will consider them, but until then, I will look elsewhere, as are more and more buyers. Who’s fault is that?

  • avatar

    I was an observer at the Dec 07 Bali Kyoto Conference,

    On behalf of what organization?

  • avatar
    Bridge2far

    mikey :
    And we are fortunate to have great neighbors to the north! Oh Canada!
    Shout out to #9 Zach Parise in NHL all star game tonite in Montreal!

  • avatar
    KalapanaBlack

    rpol35 :
    January 24th, 2009 at 4:21 pm

    GM has done a lot of very stupid things, we all know that to be true. Nevertheless the constant haranguing about “GM sucks and Toyota is great” is getting really old and ceases to have relevancy. We should be looking forward and not backwards; all this slop is starting to sound like the typical slanted reporting that I have come to expect from the New York Times.

    I think you’re missing the point of the article. It isn’t bashing GM. It’s simply outlining the different approaches to the same situation taken by two companies. GM is doing it GM’s way, and these are the consequences. Toyota is doing it Toyota’s way, and has an outcome altogether different from GM. It isn’t inherently bashing or praising either one.

    I suppose you could take it that way, but it really says more about your personal opinions than the article.

    Also, I don’t understand your take that this is somehow looking back. You obviously mean that it’s dwelling on GM’s past mistakes. I beg to differ. This is a current event that is unfolding daily, has been developing for perhaps 6 months tops, and will continue to effect each and every one of us through the economy, jobs, and tax-backed bailouts for years to come. How is this looking back? It’s reporting a current event and analyzing how two companies are dealing with the same set of circumstances.

    Yes, it does imply a history of similar decisions by both companies, but how can we move forward and avoid repeating mistakes if we don’t look back? We aren’t dwelling on it, and neither is this article. We are simply saying that GM continues to make the same mistakes that they’ve been claiming to have put behind them for the past two or three decades and it continues to have a negative influence on their operations.

    I believe much of the management is applying your philosophy of never looking back to their handling of the business at GM. That’s why we get the same spin, mistakes, build quality, product management, etc., from them over and over and over.

    Seriously, the new Malibu was supposed to take the imports on. It’s a good car, but sales are all that matters, not well-paid industry scribes’ opinions. Obviously it isn’t good enough to ignite the numbers, just like the 1995 Oldsmobile Aurora, 1998 Olds Intrigue, 1997 Chevy Malibu, 2004 Pontiac Grand Prix, etc., etc., ad nauseum. Those are all cars that were supposed to ignite the sales charts and hand the imports their asses.

    Only one of those four nameplates even survives.

  • avatar
    geeber

    PeteMoran: I was an observer at the Dec 07 Bali Kyoto Conference, and while achievements were lower than expected for their agreements, almost every country has out performed the USA. Quite frankly, the USA has done next-to-nothing.

    Some of the ways they have outperformed the USA involve smoke-and-mirrors – switching from a “dirtier” fossil fuel to a cleaner one (coal to petroleum, for example). Or Germany simply shutting down dirty, outdated East German facilities. That’s called picking the low-hanging fruit, not making substantial progress.

    And let’s not forget the French solution – nuclear power, which has been fought tooth-and-nail by the environmental movement, particularly in the U.S.

    And I recall reading recently that several European countries have quietly abandoned efforts to meet the Kyoto goals.

    golden2husky: Talk about drinking the kool aid. I would say , please give it a try and let us know, but I don’t want to read about you in the paper.

    He’s right; there is truth to this. I recall reading that the Hemlock Society – which advocates the right of people to end their lives on their own terms – has said that suicide-by-automobile is no longer a sure thing, because carbon monoxide emissions have been so drastically reduced in new vehicles. Carbon monoxide emissions from vehicles nationwide are WAY down.

  • avatar
    rpol35

    KalapanaBlack :

    Look at the topics on TTAC today:

    GM: “We won’t Kill Saturn in the Next 30 Days”

    GM: “We Still don’t know What to Do with Pontiac”

    Log on tomorrow and there will be many more. This isn’t news, we all know the state that they are in and it continues on and on like this everyday to the point, in my estimation, that it’s old news and seems like an obsession. Everything GM does can’t be negative but I admit finding positive information about them is fleeting right now.

    I’m no GM defender, their cars are mostly duds and I stopped buying them years ago. I’d like to see them improve, for the sake of retaining jobs and manufacturing capability, but I doubt that will happen in a meaningful way. Personally, my experience with Toyota is better than GM but certainly not stellar or even great.

    I would prefer to see people suggest coherently and cogently a way that they could actually and realistically improve their lot in life, perhaps suggested business plans that would work, that’s looking forward.

    Toyota is obviously in a fix too but they always seem to get the “walk on water” free pass here and on other sites as well. To me, it seems slanted and not objective.

    Thank you

  • avatar

    rpol35 :

    There is only one way to fix GM, which I’ve been advocating for well over three years.

    1. Fire the current management

    2. File bankruptcy, Cut brands, terminate dealers, renegotiate union contract.

    3. Build world-class Chevrolets and Cadillacs.

  • avatar
    PeteMoran

    @ Bridge2far

    Just remember this. No matter what insignificant country you may come from, you rely on the US.

    Which is why it’s vitally important for the USA to wake up and stop making massive mistakes.

    @ Ronnie Schreiber

    On behalf of what organization?

    My employer was a guest of several Pacific countries, specifically the Philippines regarding their government’s future manufacturing and energy policies.

    My employer is SPECTRE (or should that be CHAOS) – sometimes I wonder.

  • avatar
    Pch101

    No matter what insignificant country you may come from, you rely on the US.

    It is this sort of arrogant ethnocentric insularity that is leading to the demise of Detroit. While Detroit thumps its chest and pretends to hold some sort of position of leadership, others take advantage of that hubris and actually win the game.

    I wonder what it is going to take the Detroiters to finally see the light. You would think that government bailouts and falling market share would have done the trick, but apparently not…

  • avatar
    PeteMoran

    @ geeber

    And let’s not forget the French solution – nuclear power

    I think we’ve had this discussion before and you keep repeating it. The French are reducing their dependence on Nuclear Power. Their President’s most recent announcements of renewable targets (a further 20% from renewable) are all at the expense of Nuclear Power.

  • avatar
    Droid800

    @Pete Moran

    So? What’s your point? In France, the move to greener power generation HAS to come at the expense of nuclear since the vast majority of their power comes from nuclear plants in the first place.

    The fact that the French are moving to wind power and other forms of renewable energy does not mean that Nuclear power is not a viable alternative in countries like the US, where most of our power comes from coal plants. It would be stupid and short-sighted to NOT develop nuclear and other renewable sources of energy simultaneously. (which, btw, is the ONLY way that coal plants will be able to phased out quickly)

    At this point the only thing holding up the proliferation of nuclear plants in the US are nutjob environmentalist and sever over-regulation caused by aforementioned nutjob environmentalists.

  • avatar
    fincar1

    With reference to wind power in particular, I doubt that anyone remembers how fast wind power was abandoned in the United States when cheap, dependable electric power became available. We don’t even see rusty old windmills much anymore; I saw them now and then on old farms when we took cross-country trips in the 1950’s. I don’t think that wind power is any more viable as a significant power source than it was then.

  • avatar
    PeteMoran

    @ Droid800

    What’s your point? In France, the move to greener power generation HAS to come at the expense of nuclear since the vast majority of their power comes from nuclear plants in the first place.

    No, the French have said they will no longer artificially prop up the false economics of nuclear power. It’s the same story for nuclear all around the world; the economics don’t work.

  • avatar
    Droid800

    The economics of ‘green power’ don’t work either.

    Nuclear power, especially in breeder reactors, at least has the capability of matching coal plants for output.

  • avatar
    PeteMoran

    @ Droid800

    The economics of ‘green power’ don’t work either.

    I don’t believe you have the first clue as to what you’re referring to. A sweeping statement such as this makes it clear.

    If you’re understanding of green power is plugging a couple of wind turbines into an existing grid then you are seriously under informed. Feed-in? Massive solar thermal? Combined-Heat-and-Power? Grid deconstruction?

    No renewable energy economists (I work in energy policy and manufacturing) claim that a renewable solution can deliver everything today.

    Nuclear power, especially in breeder reactors, at least has the capability of matching coal plants for output.

    Breeder reactors are the most filthy devices you can possibly imagine. The engineering complexity and waste handling questions alone kill them stone dead.

  • avatar
    tesla deathwatcher

    The economics for nuclear power don’t work in France?

    Compare Denmark, which subsidizes wind power, with France. Denmark has the highest electricity price in the European Union. France has the lowest. By far.

    Denmark, by the way, also has the highest per capita carbon dioxide output for electricity generation. France has the lowest.

    France also has the most active nuclear power research program in the world. And the most new nuclear reactors in the pipeline. And nuclear power has been increasing in France, on a percentage basis, every year. It’s almost 80% now.

    The United States currently generates the most electricity from nuclear reactors in the world. France is second. But since the US generates so much electricity, nuclear power’s share is only about 20% in the US.

  • avatar
    Droid800

    @Tesla Deathwatcher

    Don’t bother trying to reason with Pete. He’s stubborn as a mule and can’t stand it when other people know more than him, and just might be better informed about a particular subject.

  • avatar
    PeteMoran

    @ tesla

    France is reducing the portion of power generated by nuclear. It was approaching 79% and is now falling and with the most recent policies will fall much faster.

    Unlike the Swedes or in Finland, the French have put nothing aside for decommissioning and clean-up. Those costs are not reflected in the consumer price of electricity, but they will be paying. The British (the oldest users of nuclear power) are learning this lesson right now.

    Brazil has the most active nuclear program in the world, after India, China and Indonesia. Do you see any problems in there???? I sure do.

  • avatar
    PeteMoran

    @ Droid800

    Don’t bother trying to reason with Pete. He’s stubborn as a mule and can’t stand it when other people know more than him, and just might be better informed about a particular subject.

    I have been an energy (in manufacturing) analyst/advisor/consultant for more than 25 years. The company I work for specializes in manufacturing innovation and market transformation.

    You tried to tell me while the rest of the world was deprived of American pickup trucks, that there was no alternative for US needs, the rest of the world couldn’t possibly get work done. Spare me.

  • avatar
    tesla deathwatcher

    Ever since I invested $500 in a new and innovative wind turbine company 34 years ago as a college freshman in electrical engineering, I’ve been interested in energy.

    I lost that $500 when the company quickly went bust. But I did not lose my interest. My views on energy have changed over the years. Energy issues are important, and tough. Debate helps, I think.

    So I don’t mind hearing other people’s views. Particularly those who disagree with me.

  • avatar
    Luther

    @golden2husky

    I wasn’t clear…Without O2 one will *sufficate* but the exhaust is not poisonous…Modern car exhaust is nearly pure CO2 and water now…Neither are pollution.

    The 2007 EPA regs lowered cold start CO/HC/NOx and also lowered steady-state emissions…Tier 2 bin 5 spec…Lowered NOx especially which is why cars get less fuel mileage…Gots to burn more gas to get NOx down.

    “No, the French have said they will no longer artificially prop up the false economics of nuclear power.”

    Nuclear power is as cheap as coal power…Even with the stupid government regulation that make nuclear hugely expensive….Go to MIT.edu and read their Pebble Bed reactor studies.

  • avatar
    niky

    rpol35:
    Toyota is obviously in a fix too but they always seem to get the “walk on water” free pass here and on other sites as well. To me, it seems slanted and not objective.

    Really? Almost every autosite (including this one) gives Toyota a tremendous amount of crap about its products. Tremendous:
    https://www.thetruthaboutcars.com/toyota-corolla-s-review/

    And have you seen the undisguised glee in the articles reporting hybrid sales slowdown?

    The only people who give Toyota a free pass are the mainstream media… the ones who drink Toyota’s “green” Kool-Aid.

    TTAC gives credit where credit is due. Toyota may make dull, boring cars, but they’re doing smart business. GM is not. The whole point of the article is that GM could lift a page from the Toyota book and do itself a little good.

    Toyota is in the exact same fix as the rest of the industry, not their own fault. But they’re not whining about it, asking for bail-outs and waffling on management decisions. They’re taking drastic action right now.

    I’m not on the boat with the people who’re saying the Big 3 are in trouble because they don’t make good cars (I drive a Ford), because I’ve seen their capability to make competitive and even class-leading vehicles. But even when they put out a winner, poor management decisions seem to just destroy whatever gains they see from stumbling on an excellent product.

  • avatar
    Kurt.

    No matter what insignificant country you may come from, you rely on the US.

    Unfortunately, in the banking segment, you are correct as most economies have ties to the dollar. Something else to point out is that when America had its housing/banking meltdown, other countries had to take a hard look at their industries and many of them saw the same thing happening in their home markets. It just happened to America first and allowed them to intervene.

    As for the nuclear situation, although nuclear is cleaner and produces more electricity for the dollar, it has a shorter life expectancy than even fossil fuel. There is not enough Uranium on Earth to power all the worlds current and planned facilities. China has 28 plants under construction or planned and no fuel. Australia and Canada have the lions share but Australia refuses to mine and sell it. I believe it was 2 years ago that China tried to partner with Australia to change the Uranium mining and export laws and utterly failed.

    I have no link to support the environmental cleanup of the US, but I worked on and did grey market cars in the ’70’s and ’80’s. European cars had to adapt to the US laws to be allowed in the country. In their home country and other markets, they sold unclean cars. It took Europe longer to adopt clean vehicles for their home market. America was ahead of the curve. I also remember the massive pollution campaigns in the ’70’s. Remember the crying Indian? I still have the image burned in my brain of a hitchhiking on a Southern California highway (101) strewn with litter and a particular McDonalds bag with the Styrofoam containers from a family of 4. America has largely cleaned up their act. Littering is “bad” from a legal but most effectively from a social standpoint. Your neighbor will look at you cross ways in church or Walmart if they see you throwing trash from your car – even a cigarette butt!

    When I moved to the Middle East and then to Europe, America had been “cleaning up” for almost 20 years. The difference was staggering. It was another 10 years before we saw any meaningful change in Europe. Where Portugal and Spain are today, America was in 1985. It has been faster for the Europeans but I credit that to having an example to go by.

  • avatar
    PeteMoran

    I’m sorry to everyone to turn this into a nuclear debate.

    @ Luther

    Nuclear power is as cheap as coal power…

    Look, I don’t know where you get a such a statement when almost all coal fired power stations are run for essentially the nominal costs of fuel and nuclear proponents hugely understated waste handling costs/decomissioning.

    Pebble Bed reactor studies

    Well, I prefer the ones from the Max Planck Institute which have lead to the shutdown of the German Pebble Bed and the single example in China not being pursued (as far as anyone is aware).

    Germany favors the far cheaper solar feed-in that has been made to work extremely successfully.

    The USA could do that today, and create a massive renewable industry with benefits measured in centuries rather than years.

  • avatar
    geeber

    PeteMoran: I think we’ve had this discussion before and you keep repeating it. The French are reducing their dependence on Nuclear Power. Their President’s most recent announcements of renewable targets (a further 20% from renewable) are all at the expense of Nuclear Power.

    That doesn’t disprove that, up until now, France has reduced carbon dioxide emissions through the extensive use of nuclear power.

    You are talking about what France is going to do. I’m talking about what it has done, which is the relevant topic here.

    PeteMoran: No, the French have said they will no longer artificially prop up the false economics of nuclear power. It’s the same story for nuclear all around the world; the economics don’t work.

    Without subsidies, neither does green power. I’m not against green power – but let’s be realistic here. I work in state government, and the simple fact is that green power is not economically feasible without government subsidies – either outright grants, tax credits or some sort of regulatory relief.

  • avatar
    PeteMoran

    @ Geeber

    Thanks for your response.

    Check this example of green power that is receiving no government assistance, and will provide 60-75 years of cheaper than the current per MW/hr rate;

    Ausra

    The next plant planned is absolutely enormous with deliverable electricity at about 80% of current prices, or 90% if they get the go-ahead to include a storage system. It could be operating in 3 years.

    They have interest from all around the world.

    Disclosure: My employer has worked for both PG&E and Ausra.

  • avatar
    geeber

    PeteMoran: Check this example of green power that is receiving no government assistance, and will provide 60-75 years of cheaper than the current per MW/hr rate…

    I’m all for green power, but story in the October 24, 2008 edition of the The Australian on this plant specifically mentions government subsidies that made it feasible:

    Mr Schwarzenegger this week turned on a 5-megawatt Ausra solar thermal plant near Bakersfield, California. The firm proposes to build a 177MW plant for US energy utility Pacific Gas & Electric and will bid for the upcoming solar energy plant contract in the ACT.

    Ausra has also built a 1.5MW solar plant to augment the Macquarie Energy owned Liddell coal fired-power station in the NSW Hunter Valley that has just been commissioned.

    Ausra Australia CEO Bob Matthews said the cost of the company’s technology was on par with gas-powered electricity generation in the US, where tariff incentives made renewable energy power production attractive. (emphasis added)

    Mr Matthews has been lobbying government in Australia to introduce a feed-in tariff for renewable energy operators where they are given a guaranteed premium over the market rate for electricity.

    “I have inquiries for projects equal to thousands of megawatts around Australia,’ said Mr Matthews. “But other than the coal-fired projects and some off-grid applications I can’t compete right now with black energy and there’s no incentives in the system to level the playing field.” While Ausra is based in the US and received first-round funding from US venture capitalists, its founder is expat solar energy pioneer David Mills. Part of the firm’s $US60.6 million second-round funding package comes from local venture capitalist Starfish Ventures.

    Again, I’m all for this…but it seems as though government assistance and incentives are necessary to get the ball rolling.

    And some sources bring their own set of problems. About two months ago I attended a meeting where the placement of wind towers in Pennsylvania was discussed. Wind towers are most effective in Pennsylvania when placed along mountain ridges, as the wind is more steady there. Unfortunately, that means a road must be constructed to the towers (to allow access for service vehicles), and the wind towers themselves are rather unattractive. So there are still some trade-offs here…

  • avatar
    Luther

    “…which have lead to the shutdown of the German Pebble Bed and the single example in China not being pursued”

    For POLITICAL reasons! Not science/economics.

    The cost is about USD $0.015 per kwhr.

  • avatar
    PeteMoran

    @ Geeber

    Yes, you’re correct. My apologies. I was meaning that no-one is helping them build the plant itself, but I accept they’re getting a tariff attractive feed-in to get started, which is one of the reasons Australia lost the technology to the USA.

    I’m sure you’ll agree, energy economics are more complicated than the per minute price. Over the life of this Ausra plant, the electricity is significantly cheaper (10-20%) and being a renewable there’s no reason the price should not be completely stable.

    @ Luther

    I have nearly 60 years of plant history in our company’s database (mostly UK, some Finland, some US, one French, one Japanese), and there is not a single example of any nuclear plant operating at it’s claimed costs, and most of those are before clean-up complications.

    If you say it’s political interference, then fine. I would say that the political interference has ensured the product has been delivered safely and cleaned up properly.

    The Russian examples are extraordinary, which the USA (essentially) is funding to clean up.

  • avatar
    Luther

    What are their costs?…Not that I don’t believe you…HeHe.

    Is the physical reality in Germany somehow different than Massachusetts?

  • avatar
    PeteMoran

    @ Luther

    Example1; Maine Yankee. More than $600m (2003) over 1972 budget and continuing. Shut down 10 years before originally planned.

    Example2; Trojan, PG&E. More than $50m 1971 dollars over budget.

    Example3; St Laurent, France. Postponed. Closure costs 20 times budget.

    Example4; Tarapur, India. They’ve decided to run it into the ground until 2015 and then leave it in place. Future costs and consequences unknown.

  • avatar
    tesla deathwatcher

    Pete Moran, you know a lot about the energy issue, and you make some good points. Certainly nuclear energy is not a panacea. At best, and if that, it is the lesser of evils.

    But I think you conflate what might be with what is. You compare nuclear energy, where France shows what can be done, with a brave new world where Ausra and others have delivered on their promises. I don’t think that’s a helpful comparison.

    In France, you have a large country which gets 80% of its electricity from 59 nuclear power plants and 13% from hydroelectric dams. Both of those power sources are cheap (at least as they do their accounting) and generate minimal carbon dioxide.

    Compare that with the best record on renewable electric power — Denmark. Denmark has spent billions (if calculated in dollars) to subsidize the construction of windmills. And it spends billions more to buy power from the windmills.

    Yet Denmark still has the highest priced power in Europe. And generates the most carbon dioxide. And not a single fossil fuel power plant in Denmark has been taken off line because it has been replaced by wind.

    I’m not criticizing Denmark. Far from it. I applaud what Denmark and Germany are doing to promote wind power (in Denmark’s case) and wind and solar (in Germany’s).

    But I think you have to look at the two cases and say that nuclear power, with all its faults, has proven feasible. Wind and solar have not. They may still prove feasible, but to date they have proven the opposite.

    Certainly companies like Ausra give us hope. But again, it’s not helpful to compare what concentrated solar might do with what nuclear has already done.

    I’ve looked carefully at Ausra. To date, they have wildly exceeded even their most pessimistic cost estimates. They have huge technical problems with what they are attempting. Problems that they may or may not be able to solve.

    Ausra has attracted venture funding, and a lot of attention. And they deserve it. But Ausra is the kind of high-risk, high-reward opportunity that venture firms like. The typical odds of venture-funded businesses — 10% to 20% success rate — apply I think here. If Ausra makes it, great. But we would be foolish to count on it.

  • avatar
    PeteMoran

    @ Tesla

    I agree with you. Really I do. It’s always going to be about a mix of sources. Renewable power advocates (including me) are not foolish enough to suggest it’s possible to operate fully on renewables.

    I don’t know a lot about Denmark. I think they’ve made some mistakes for sure. I’m surprised at their power pricing (I looked it up after your first post). I’m not sure how they do that under the EU; those power charges are supposed to be the same.

    Day after day I see people claiming Uranium Nuclear is “the answer”. The economics let it down, plus ultimately it’s a finite resource. Thorium Nuclear is much better, but again ultimately finite. (I have less problems with Thorium myself as I have posted previously).

    Ausra is very promising. The technology is cheap and simple and they’re gaining momentum very quickly.

    We won’t have real electricity reform until the massive power station/grid idea is unwound. Micro power generation (feed-in solar etc) and multiple smaller plants, plus efficiency gains, plus combined heat and power are stacking up very nicely.

  • avatar
    tesla deathwatcher

    Well said, PeteMoran. Thanks for the useful information and viewpoint.

  • avatar
    adb12

    Let’s add some facts…

    1. Management change? Aside from the new CEO, where are the big changes at Toyota? Ah, that’s right, they got new US leadership–after Jim Press left for Chrysler. And he got HIS promotion after his predecessor resigned after allegations he sexually harassed his secretary. GM has been slimming down, cutting white-collar staff, and moving new people into leadership positions for three years.

    2. Take a moment and read the plan submitted to Congress in December (it’s out there on the Interwebs). Additional dealer cuts, bonus elimination, brand consolidations, staffing cuts–it’s all there. And Toyota only met a couple of days ago to address this?

    3. As far as big trucks and SUVs, Toyota built a brand-new, huge plant in Texas designed to build nothing but large, gas-guzzling SUVs and pickups. No diesels, by the way, or hybrids to help fuel economy–and the plain old gasoline models get worse fuel economy than Ford or GM. Why did they do this? The same reason Detroit did–it’s where the money is.

    4. Toyota’s Kentucky workers make $2 an hour more than their UAW counterparts. I hardly consider that “coddling.” The cost issues associate with the UAW are based on legacy costs and employees.

    5. Toyota has been slow to develop cars for emerging markets, where GM is outselling them in many countries with a wider choice of vehicles; Toyota’s emerging market vehicles are limited now to (surprise) SUVs and MPVs. They are #3 in China behind GM and VW, and they won’t have a small car for India until 2010, a year after GM.

  • avatar
    PeteMoran

    @ adb12

    1. I’m not sure why we need the sexual scandal element, but the response is that Toyota people are not rewarded year after year for failure. Actually, that question has never come up. The first time it did, many are moving aside. Toyota executive compensation is extremely modest by international standards. Wagoner et al and the Board of Bystanders (copyright Farago) have so far refused to move on.

    2. The GM restructure plan submitted to Congressional hearings had them still insolvent at ~12m SAAR after 2 years. It was a plan drawn up in a single month which Wagoner admitted was more drastic than they ever thought would be required. It was in response to Congressional demands (and a statement of the plainly obvious) that whatever “plan” they had prior to requesting government help wasn’t working. (See Point 1 – management should resign en mass).

    3. Internally Toyota are disappointed with Tundra. They won’t make the mistake again. They will salvage what they can from that plant, perhaps it’s designed cleverly and can be converted quickly to something else.

    4. That’s great news for GM then. Why are they still losing money again?

    5. Toyota’s organic growth in every market they operate in since the mid-1960s onwards and GM’s market share decline at around the same time would seem to indicate the opposite of your point. Or as another poster famously put it “We loose money on every sale, but make up for it in volume”.


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