The Plan

[Nethead]

I just read a lengthy article on the  Popular Mechanics  website entitled "10 Cars that Damaged GM's Reputation".

Popular Mechanics  is as pro-Detroit as any publication on Earth--always fawning over the latest electronic gizmos and gadgets for automobiles and always buying into the typical manufacturer hype about how added complexity always adds value because the manufacturer says so (therefore, it must be true).

The article convinced me that a bail-out of Ford is sketchy and a bail-out of Chrysler/Cerberus is ill-advised--but a bail-out of GM would be one of the classic  civilization-ending mistakes  of all time!!!  Sheee-it they're awful!!!  And a bail-out might prop GM up for another year of shittiness in everything!!  GM fanboys, don't read that article...

[Vinsanity]

bah, you can't tell us what to read!

http://www.popularmechanics.com/automotive/reader_rides/4293188.html

[Secret Chimp]

http://www.popularmechanics.com/automotive/reader_rides/4293188.html?page=2

THANK YOU

A 1980 Citation made my middle school experience even more ruinous than it had to be.

[hotrodalex]

bah, you can't tell us what to read!

http://www.popularmechanics.com/automotive/reader_rides/4293188.html

I don't agree with the Saturns.

[Soup DeVille]

I don't agree with the Saturns.

neither do I.

A lot of people really liked the early Saturns. They had fan clubs and Saturn rallys and everything.

Now, there really are no Saturns, just rebadged something or others.

Of course, the basic premise behind making an "import fighter" brand was flawed from the beginning. Every single car that GM makes needs to be an import fighter.

[hotrodalex]

neither do I.

A lot of people really liked the early Saturns. They had fan clubs and Saturn rallys and everything.

Now, there really are no Saturns, just rebadged something or others.

Of course, the basic premise behind making an "import fighter" brand was flawed from the beginning. Every single car that GM makes needs to be an import fighter.

My brother has an SL2 (? idk it's a '96 sedan) and it is a good car. It's no drag racer or F1 car, but it gets the job done.

And before my mom gave the car to my bro, my dad was driving it and slid on ice. Hit the car in front on him and no damage was done, thanks to the plastic body panels (he pulled the hand brake and slid sideways to avoid a head-on)

[Vinsanity]

neither do I.

A lot of people really liked the early Saturns. They had fan clubs and Saturn rallys and everything.

Now, there really are no Saturns, just rebadged something or others.

Of course, the basic premise behind making an "import fighter" brand was flawed from the beginning. Every single car that GM makes needs to be an import fighter.

This high-ranking lady at my office leased a M-B CLK which she constantly complained gave her problems, but still holds her old Saturn she drove back in the early 90's with high regard; her mom now drives it.

[3.0L V6]

I don't agree with the Saturns.

I'll say that they're not bad cars for the era. They were totally outclassed by the end though. There were some model-wide problems that tarnished them though. Oil burning, differential pin explosions, coolant temp sensor failures were all common to the Saturns.

I think they're a deal when bought used, as they suffer pretty brutal depreciation, and they're pretty frugal with gas. Nothing special, but if you know the weak points, you could have a pretty reliable small car.

[dazzleman]

neither do I.

A lot of people really liked the early Saturns. They had fan clubs and Saturn rallys and everything.

Now, there really are no Saturns, just rebadged something or others.

Of course, the basic premise behind making an "import fighter" brand was flawed from the beginning. Every single car that GM makes needs to be an import fighter.

With your last line, you absolutely hit the nail right on the head.

GM (as well as Ford and Chrysler) assumed that there were a certain number of people who would buy domestic cars no matter what, and they geared their lineup accordingly.  As the number of people in this category kept steadily dropping, to below the point to allow the survival of their businesses, they didn't readjust their thinking.

It's awfully late now to suddenly whip up a 'plan' to straighten things out.  Where have they been the past 30 years?

Mullaly said Ford's previous philosophy was "if you build it, they'll come."  I haven't owned a Ford since the mid 1980s, when they were putting out pieces of crap that were shot at 50,000 miles.  With that attitude, it's not hard to see why they're in deep trouble.

[the Teuton]

Car buying happens at a young age, and it will shape your opinions for the rest of your life.  If you get your dad's hand me down Accord and it goes 300,000 miles before you sell it, and it's still running like a top, chances are your next car might be a Honda because you trust them so much.

The Big 3 killed a lot of their chances to get young people when they decided to keep the scheisse J-Body for so long (and cars like it), and not make anything especially reliable or inspiring that the masses could afford for a while.

[Soup DeVille]

With your last line, you absolutely hit the nail right on the head.

GM (as well as Ford and Chrysler) assumed that there were a certain number of people who would buy domestic cars no matter what, and they geared their lineup accordingly.  As the number of people in this category kept steadily dropping, to below the point to allow the survival of their businesses, they didn't readjust their thinking.

It's awfully late now to suddenly whip up a 'plan' to straighten things out.  Where have they been the past 30 years?

Mullady said Ford's previous philosophy was "if you build it, they'll come."  I haven't owned a Ford since the mid 1980s, when they were putting out pieces of crap that were shot at 50,000 miles.  With that attitude, it's not hard to see why they're in deep trouble.

There was a BBC radio story about the whole big 3 bailout thing I listened to last night, and it had an interview with a couple of different lineworkers.

They all basically were of the opinion that "nobody could have seen this coming."

[dazzleman]

They were obviously living in a dream world.  It was very easy to see this coming.

[the Teuton]

As per WSJ, Chrysler hired a bankruptcy firm and TB3 are going to get a small "stay afloat" bailout it looks like.

[JWC]

I think one point that everyone is missing is that all car sales are down, be it GM, Ford, Chrysler, Honda, Toyota, or Nissan.  I agree with the line worker, no one could have seen this coming.  If this down turn only affected the three US companies, then yeah, it could have and should have been foreseen.  When a drop such as this strikes all manufacturers, then this isn't about not building green cars, less trucks, or hybrids.  It is about a economy where people have stopped buying automobiles.
 

[dazzleman]

When something like pneumonia strikes, those who were less healthy before the disease hit are the ones who die, while people who were stronger before the disease are more likely to survive it.

It's the same with business and economic slowdowns.  While the magnitude of this downturn was not forseen by many, the steadily eroding financial and market position of the Big 3 has been clear for a long time.  There were rumblings about a GM bankruptcy well over a year ago.  To say that this whole thing came totally out of the blue is either disingenous or dangerously out of touch.

[dazzleman]

Mullaly said for previously had the 'build it and they'll come' attitude.  I guarantee Honda and Toyota didn't build up their sales at the expense of the Big 3 with that attitude.

The Big 3's problem is they didn't build cars enough people wanted to buy.  Their problems were evident before this downturn, and this downturn is hastening theor death the way pneumonia kills an already-sick person.

The potential is that the government will make it worse, by extending them a lifeline on the condition that they build politically correct vehicles that consumers are 'supposed' to want, but don't actually want.  When they can't sell enough of those to stay afloat, the taxpayers will have assumed a greater amount of financial responsibility for the whole mess.

[Vinsanity]

The potential is that the government will make it worse, by extending them a lifeline on the condition that they build politically correct vehicles that consumers are 'supposed' to want, but don't actually want.  When they can't sell enough of those to stay afloat, the taxpayers will have assumed a greater amount of financial responsibility for the whole mess.

That's a scary thought. And somewhere in Germany, there'll probably be a group of Trabant engineers pointing and laughing at us if that happens

[JWC]

Dazzle, I hear you, but still, it is one thing for a company to be sliding downhill when cars are selling, quite another when everyone's model sales drop also.  Ford realized they had a problem and began restructuring over a year ago.  GM was probably in denial.  People knew Chrysler was in trouble, or should have because the company had been up for sale.  Car companies have failed before, but those companies didn't take everyone down with them.  Admittedly, suppliers will be affected, but if other car makers are having the same problem getting the public to buy their vehicle, then the problem isn't something solely the Big 3's, which is what member of Congress and the media are telling the public.

Yesterday on Morning Joe, the comments were on the order of....American cars are junk, they were not building what people wanted, they get terrible gas mileage. etc.  Tucker Carlson had nothing good to say about the quality of American cars and trucks.  He backed up his statement by saying the he had rented numerous American cars when traveling.

Congress is telling everyone that American car companies need high gas mileage and "green" cars.  But there is a link in another thread, that shows even the hybrids have dropped in sales.

[dazzleman]

Dazzle, I hear you, but still, it is one thing for a company to be sliding downhill when cars are selling, quite another when everyone's model sales drop also.  Ford realized they had a problem and began restructuring over a year ago.  GM was probably in denial.  People knew Chrysler was in trouble, or should have because the company had been up for sale.  Car companies have failed before, but those companies didn't take everyone down with them.  Admittedly, suppliers will be affected, but if other car makers are having the same problem getting the public to buy their vehicle, then the problem isn't something solely the Big 3's, which is what member of Congress and the media are telling the public.

Yesterday on Morning Joe, the comments were on the order of....American cars are junk, they were not building what people wanted, they get terrible gas mileage. etc.  Tucker Carlson had nothing good to say about the quality of American cars and trucks.  He backed up his statement by saying the he had rented numerous American cars when traveling.

Congress is telling everyone that American car companies need high gas mileage and "green" cars.  But there is a link in another thread, that shows even the hybrids have dropped in sales.

I think the problem with American cars is at least partly one of perception.  Take Pontiac, for example.  Pontiac has been hampered in its ability to attract wannabe higher end sports car purchasers because of its lower class image.

People have long memories, and they still remember the junk that Detroit was putting out in the 1970s and 1980s.  They remember the bad service they got when they kept taking the car back to be fixed over and over.  The whole thing was rotten.  People also remember that their car experience improved when they switched to Japanese.  This is the perception that Detroit has been fighting for a long time, with very limited success.  Once a certain idea takes hold in the public mind, rational or not, it is very difficult to change it.  For that reason, Detroit was able to compete on sedans only by pricing them more cheaply than the competition, which magnified their problem with higher labor costs than their competitors.  Had the cars had better appeal, they could have charged enough of a premium to overcome the higher labor costs, and they wouldn't be that big a deal.

Detroit has done well in recent years with trucks and SUVs.  For whatever reason, these sorts of vehicles haven't suffered from the lower class image that American sedans seem to have.  In my neighborhood, the typical auto configuration is for a family to have a German sedan, and an American SUV.  So Detroit became very dependent on these high-margin vehicles, and didn't do enough to improve their image with sedans.  That left them vulnerable when gas became very expensive.

I don't know if people will go back to the SUVs now that gas prices are falling.  I'm not sure they trust that the prices will remain low, and people aren't in a mood for unnecessary spending anyway.

To some extent, our economic weaknesses are sort of like a house being eaten by termites.  Those termites are excessive debt, among other things.  With termites, you might have little signs of a problem here and there, but to the naked eye, the house appears completely undamaged until almost the moment of collapse.  And that is what has happened with our financial institutions, and it's what's happening with the Big 3.

To some extent, they're still in denial.  I saw Bob Lutz on some show last night, talking about what a great job the Detroit CEOs have been doing, what great cars they have, and how the current problems are completely because of the economic slowdown.  While I recognize that the slowdown is what has potentially pushed them over the brink (the way pneumonia kills a patient already in poor health), the problems have been developing for a long time, and the Big 3 have not addressed them sufficiently.

I echo your concerns about the whole hybrid/green thing.  Those are the sorts of cars that the politicians want people to buy.  I'm not at all sure that that's what people really actually want to buy.  Now that the Big 3 are on the ropes, and will do anything to be rescued, I fear that congress will force them to agree to make a lineup of cars that people want even less than the current lineup.  As poorly as the Big 3 have been run over time, I see no evidence that government boards will do any better, if they're appointed by congress.  And I find the idea of government running private businesses to be a pretty scary one, though obviously there has to be some oversight for the taxpayer money being invested in these companies.

The bottom line is that even if the government helps the Big 3 to get over the current hump, their longer-term survival is very much in doubt unless they change their image and appeal to more buyers.  Their "Buy American" campaigns in the past appealed to naked patriotism, and basically told people that they owed it to their country to buy an inferior car.  That failed miserably, as they steadily lost market share.  They need to come up with something better, because the government can't prop them up indefinitely.  You can't push a thread through a needle.  I recognize all the jobs that depend upon the auto industry, and I consider it a strategic asset to have that large-scale manufacturing capacity in the US.  I have deep concerns about our economic future without major manufacturing.  But the answer can't be for taxpayers to prop up unsuccessful companies indefinitely.

The consensus seems to be that Ford has done the most out of the Big 3 to improve their position already.  GM still seems to be in denial, and Chrysler is a mess.

[JWC]

Japanese quality did improve by the end of the 1980's, but I believe it was over-rated during the seventies and eighties. 

I worked for Honda during that period and those cars had some very serious quality problems, but people were so loyal, they forgave them.  Honda, Toyota, Datsun were usually the cars that parents bought for their kids to drive from high school and college.  That period was formative for those young people to develop their loyalty to the car that took them on road trips and some good times.

There was certainly a basis for the reliability factor, but not to the degree that is fondly remembered.  Same for interior and sheet metal.  Let's not forget, the Japanese cars of the 1970's and early 1980's were rust prone.  The sheet metal was thin and shutting the door on a Japanese car revealed a lack of sound deadening.  Interior panels were just paste board with vinyl stretched over it. Sunvisors warped after just a couple of years.  Seats were basic and generally uncomfortable, which I guess was fine for a buttocks of a young person.   Engine problems, and there were some, were taken care of discreetly to build that reputation of quality.  At Honda for example, we were having head gaskets blowing out on the CVCC engines.  The replacement part was redesigned several times before the problem appeared to be solved.  On the late seventies Accord, front fenders were rusting through, even in dryer climates like California.  Honda discreetly took care of the problem.

By the late eighties, Honda cars were getting away from the basic car to more luxurious models.  The reason given was because all those kids were now college grads and were looking to American companies for bigger and better. Honda saw the market changing and wanted those college grad to look to Honda to "grow with them and their families".  Not a bad marketing idea, but it did lead manufactuers away from offering a basic reliable car at a economical price to a dressed up version at a much higher price.

[dazzleman]

Japanese quality did improve by the end of the 1980's, but I believe it was over-rated during the seventies and eighties. 

I worked for Honda during that period and those cars had some very serious quality problems, but people were so loyal, they forgave them.  Honda, Toyota, Datsun were usually the cars that parents bought for their kids to drive from high school and college.  That period was formative for those young people to develop their loyalty to the car that took them on road trips and some good times.

There was certainly a basis for the reliability factor, but not to the degree that is fondly remembered.  Same for interior and sheet metal.  Let's not forget, the Japanese cars of the 1970's and early 1980's were rust prone.  The sheet metal was thin and shutting the door on a Japanese car revealed a lack of sound deadening.  Interior panels were just paste board with vinyl stretched over it. Sunvisors warped after just a couple of years.  Seats were basic and generally uncomfortable, which I guess was fine for a buttocks of a young person.   Engine problems, and there were some, were taken care of discreetly to build that reputation of quality.  At Honda for example, we were having head gaskets blowing out on the CVCC engines.  The replacement part was redesigned several times before the problem appeared to be solved.  On the late seventies Accord, front fenders were rusting through, even in dryer climates like California.  Honda discreetly took care of the problem.

By the late eighties, Honda cars were getting away from the basic car to more luxurious models.  The reason given was because all those kids were now college grads and were looking to American companies for bigger and better. Honda saw the market changing and wanted those college grad to look to Honda to "grow with them and their families".  Not a bad marketing idea, but it did lead manufactuers away from offering a basic reliable car at a economical price to a dressed up version at a much higher price.

Honda allowed their demographics to age, and that is a good strategy for a time, if you start out with younger buyers.  It is a problem if it's allowed to go on for too long.

That's one of the big problems with the Big 3 -- that they allowed their demographics to age until many of their customers were dead, without younger replacements.  Cadillac service departments have been known as "God's waiting room."  Oldsmobile and Buick suffered similar image problems, as has Ford's larger sedans.  It was cheaper in the short run to keep turning out cars that were unchanged largely for a couple of decades.  It saved on R&D costs and produced a higher profit margin, but the buyers for these cars eventually dwindled due to attrition.

Honda buyers now are often in their 50s or so, so Honda is actually on the edge of the demographic issue.  They can't afford to let their demographics age more, or they'll face the same problem as GM and Ford with demographics.

I think a big part of the problem for the Big 3 is that many people are still angry at them not just for the junky cars they produced in the 1970s and 1980s, but for the way their loyalty was taken for granted.  It wasn't just the bad cars, but also the bad service at dealers when cars under warranty were taken to be fixed over and over again.  Anybody over a certain age has horror stories.  People are still angry that Detroit thought it could force absolutely crap down their throats, and tried to make them feel unpatriotic for looking elsewhere.  While Japanese cars at the same time weren't perfect, they were generally better, and that's what people remember.  They think that at least the Hondas and Toyotas knew they had to earn their business, while the Big 3 thought they didn't have to.

Rational or not, that attitude plagues the Big 3 to this day.

[FoMoJo]

I don't know how valid it is, by my view is...

The imports got their foothold in the NA market during the first and second energy crisis when their cars were cheap to run and didn't need a bunch of efficiency and power strangling pollution devices to pass emission laws.  The NA automakers, in the early '60s, gave some attention to producing compacts, Falcon, Dart, Corvair, et al, but somehow that got lost in the musclecar era.  These cars were competing against imports from the UK and Europe.

By the time of the real energy crisis, combined with stricter pollution laws, NA didn't have much to offer and the imports, Toyota, Honda, were starting to show up; and they weren't really very good cars for the NA climate...especially cold and damp weather areas.  Perhaps a bit better that the UK models but not as good as domestics.  However, being cheap to run, many households bought them.  The kids growing up in those households, rather than becoming a Chevy, Ford and Mopar fans, became a Honda or (god forbid) Toyota fans.  Eventually, they became import fans in general and this led to the tuner (riceboy) era.

The real decline of the domestics happened from the mid '70s through to the '90s.  Either through complacency or bad management, or they were simply waiting for the bad times to pass, they all but ignored product; with a few exceptions like the Taurus.  The economic boom of the '90s was a mixed blessing; and may well have sealed their fate.  Cheap (relatively) energy spurred the consumer demand for trucks and SUVs...guys were embarrassed driving vans and saw a great compromise in SUVs; women as well.  The domestics responded by putting all their development resources into SUVs and trucks.  In the late '90s they were all bulging with cash and went on shopping sprees in Europe and Japan.  Then the bottom fell out and by the early 2000's they had started to wake up to the reality...at least Ford did; likely spurred on by the infamous Firestone fiasco.  It was then that they realized that they needed to plug some enormous holes in their product line or the ship would sink.

Many details need to be plugged in, but that is the gist.

[dazzleman]

I don't know how valid it is, by my view is...

The imports got their foothold in the NA market during the first and second energy crisis when their cars were cheap to run and didn't need a bunch of efficiency and power strangling pollution devices to pass emission laws.  The NA automakers, in the early '60s, gave some attention to producing compacts, Falcon, Dart, Corvair, et al, but somehow that got lost in the musclecar era.  These cars were competing against imports from the UK and Europe.

By the time of the real energy crisis, combined with stricter pollution laws, NA didn't have much to offer and the imports, Toyota, Honda, were starting to show up; and they weren't really very good cars for the NA climate...especially cold and damp weather areas.  Perhaps a bit better that the UK models but not as good as domestics.  However, being cheap to run, many households bought them.  The kids growing up in those households, rather than becoming a Chevy, Ford and Mopar fans, became a Honda or (god forbid) Toyota fans.  Eventually, they became import fans in general and this led to the tuner (riceboy) era.

The real decline of the domestics happened from the mid '70s through to the '90s.  Either through complacency or bad management, or they were simply waiting for the bad times to pass, they all but ignored product; with a few exceptions like the Taurus.  The economic boom of the '90s was a mixed blessing; and may well have sealed their fate.  Cheap (relatively) energy spurred the consumer demand for trucks and SUVs...guys were embarrassed driving vans and saw a great compromise in SUVs; women as well.  The domestics responded by putting all their development resources into SUVs and trucks.  In the late '90s they were all bulging with cash and went on shopping sprees in Europe and Japan.  Then the bottom fell out and by the early 2000's they had started to wake up to the reality...at least Ford did; likely spurred on by the infamous Firestone fiasco.  It was then that they realized that they needed to plug some enormous holes in their product line or the ship would sink.

Many details need to be plugged in, but that is the gist.

I think that's a great summation.

When gas prices and shortages hit in the 1970s, Detroit was offering cars like the Pinto and the Vega.  Absolute pieces of crap.  That's how the Japanese got their first foothold.

Car buying preferences tend to be formed in youth.  When I was a kid, I remember there were certain families that were Ford families, certain families that were GM families, and so on.  That all fell apart in the 1970s.

I completely agree that the 1990s boom helped seal Detroit's fate, because it pushed them in the worst possible direction -- back to undue reliance on high-margin gas guzzlers.  They made in effect the same mistake they made in the 1960s and early 1970s all over again.  They just took the path of least resistance, something that we Americans have been doing a lot in recent decades, much to our long-term economic detriment.

[JWC]

Both of your opinions are very accurate.  I agree, to a degree, with the reliance on gas guzzlers being a mistake.  It is only mistake when shit hits the fan.  A quick look to the past could have foretold that it was bound to reoccur. 

But....who knew when it would happen. 

Gas guzzling, huge SUV's and full-size pick-ups were such a big hit with the public, even the Japanese started producing them to be able to compete and remain viable in the U.S. market with American based companies.   The same kids that were students in the 70's and 80's, then yuppies in the 80's and 90's, were beginning to move on to the SUV and pick-up market.  Just as they did a couple of decades ago, evolving to follow that market, the Japanese companies began to focus on what those now middle-aged customers wanted.   Why?  Simple, while they were still buying Accords and Camrys, their other car was a Sierra or a F150.  To meet the new demand and to maintain a hold on those customers, you saw the development of the Titan and the Tundra.

The future lies with convincing the public they do not need a crew cab F-150 or a Expedition.   I'm not sure that is going to happen.  You have people on TV talking about how Detroit wasn't producing the cars that the public wanted, while saying in the same broadcast that they own a full-size SUV. You can build a full-size truck that gets great fuel mileage, but compromise is power and torque.  With Congress in full Democratic control mode, you'll going to see CAFE ratings for trucks increase.  If Congress follows their usual path, they will set the bar high, probably higher than the manufacturers can afford at this time, and you'll find even a full-size hybrid will not meet the requirements.  The way Detroit succeeded in meeting those requirements in the past was by choking the life out of the engines they produced.  It was a cost saving measure and it evidently succeeded for a short time, but now they are paying the price.  Knowing Detroit, they'll repeat that mistake.

The future isn't with requiring that Detroit build cars that Congress thinks people will buy, but changing the publics perception of what they need.  As long as a gallon of gas is less than $3.00,  the public will not buy a "green" car no matter how much Congress wants to believe they will.

[dazzleman]

Both of your opinions are very accurate.  I agree, to a degree, with the reliance on gas guzzlers being a mistake.  It is only mistake when shit hits the fan.  A quick look to the past could have foretold that it was bound to reoccur. 

But....who knew when it would happen. 

Gas guzzling, huge SUV's and full-size pick-ups were such a big hit with the public, even the Japanese started producing them to be able to compete and remain viable in the U.S. market with American based companies.   The same kids that were students in the 70's and 80's, then yuppies in the 80's and 90's, were beginning to move on to the SUV and pick-up market.  Just as they did a couple of decades ago, evolving to follow that market, the Japanese companies began to focus on what those now middle-aged customers wanted.   Why?  Simple, while they were still buying Accords and Camrys, their other car was a Sierra or a F150.  To meet the new demand and to maintain a hold on those customers, you saw the development of the Titan and the Tundra.

The future lies with convincing the public they do not need a crew cab F-150 or a Expedition.   I'm not sure that is going to happen.  You have people on TV talking about how Detroit wasn't producing the cars that the public wanted, while saying in the same broadcast that they own a full-size SUV. You can build a full-size truck that gets great fuel mileage, but compromise is power and torque.  With Congress in full Democratic control mode, you'll going to see CAFE ratings for trucks increase.  If Congress follows their usual path, they will set the bar high, probably higher than the manufacturers can afford at this time, and you'll find even a full-size hybrid will not meet the requirements.  The way Detroit succeeded in meeting those requirements in the past was by choking the life out of the engines they produced.  It was a cost saving measure and it evidently succeeded for a short time, but now they are paying the price.  Knowing Detroit, they'll repeat that mistake.

The future isn't with requiring that Detroit build cars that Congress thinks people will buy, but changing the publics perception of what they need.  As long as a gallon of gas is less than $3.00,  the public will not buy a "green" car no matter how much Congress wants to believe they will.

Good points, John.

As I stated earlier, I share your concerns about having congress decide what Detroit should build, since it probably won't coincide with what people actually want.  As bad as Detroit has been at anticipating what people are going to want, congress is a safe bet to do even worse.

One thing I'd say is that while the Japanese companies got into the SUV craze in the 1990s as Detroit did, they were never so completely dependent upon the sales of those vehicles as Detroit was.  They were able to make money on more fuel-efficient sedans also, so they had something to turn to when sales of the SUVs declined.  Detroit didn't.

[JWC]

Detroit's mistake was not bringing in competitive vehicles, small cars, from their more successful European branches.  They still don't get it.  Look no further than the 65mpg diesel (Fiesta?).  Ford contends that American buyers are not ready to buy a small diesel powered automobile.  This is despite the waiting list over at VW for their diesel cars here in the U.S.   

Detroit saw the car sales as incidental to cross-over, SUV, and truck sales.  I can almost imagine that the suits in the boardroom were saying, "let Honda have the cars, we'll take the trucks."

[FoMoJo]

Some good points above.  I got the impression, at the time, that some of the people who where slamming the domestics for building SUVs, etc. were more than willing to buy them when they were produced by the import manufacturers.

This article titile Washington's whipping boys makes some good points as well. 

some excerpts...

If the Midwest hadn't realized before there was a front and back door to Congress, we know now. Indeed, we know there's a side door, too, reserved for the country's lower castes, which apparently now includes American automakers and anyone remotely linked to them.

Just call us the whipping boys of Washington's anti-bail-out backlash.

While Wall Street was welcomed into the front door on a Sunday night and served a bail-out with hot cocoa, Michigan's auto chiefs have been publicly humiliated before the national press so Congress and the Bush administration can show voters they're finally holding someone accountable for this disaster of an era.

While Wall Street's 1990s orgy of deregulation wrecks the economy and the Manhattan Brooks Brothers set gets a true bail-out of more than $170 billion, the Detroit Three automakers beg for a loan -- and get mocked as if they're janitors at an arrogant New Jersey country club.
The United Auto Workers slash their wages down to $14 an hour -- little more than McDonald's wages -- and humbly prostrate themselves in front of the altar of Beltway egos.

What did Wall Street sacrifice? A few brokers and Starbuck's mochacinnos.

Wall Street needed no plan. No hearings. No apology. No oversight. No proof of its importance to national security.

Wall Street didn't have to leave its comfy New York City skyrise perch, while Detroit has had to succumb to scoldings from fools such as Sen. Richard Shelby.

Shelby represents Alabama, one of the most federally subsidized, bailed-out states in the union for the last 150 years. Michigan has been a sender state in taxes -- meaning we send far more to the feds than we get back -- and has helped fund endless jump-starts in economic development in less developed states such as Alabama for most of the last century.

And he's busting our chops about a temporary loan?

Excuse Mr. Shelby, but you should be praying for Detroit's survival. Somebody's gotta pay for your subsidies!
Small-minded leaders and politicians look to blame the most vulnerable for their own sorry mistakes. They appeal to our darkest angels.

Wall Street isn't easy to pick on, but Detroit is. We, the folks with ties to old economy industries in the very un-hip Heartland, are perceived by many as the weakest on America's new socio-economic ladder.

You can hear it in the nasty undertone lurking in the debate. It's hardly just about the automakers' past mistakes, though there are many.

The story between the lines is an ancient one, about who is deserving for investment. Throughout history, the poor and working classes have always had to work harder to prove themselves and their worth. Much of the Bible is about busting that myth. Wall Street didn't have to deal with this lurking, ignorant bias. Wall Street doesn't have the United Auto Workers and rough-and-tumble factory workers linked with it.

The anti-union comments are just the beginning. Washington's negative stereotypes increasingly are associated with geographic region, too.

Globalization is remaking our country, moving the population and power base from the Industrial Midwest and Northeast to coastal, new economy wealth centers such as Silicon Valley and Portland.

The shift is in American culture, too, reflected in the comments of average people. My California friends and cousins say, with all seriousness, Midwesterners are backward, stupid. Seattle's citizens imply our region is already dead, why not just let it fall? We in the industrial heartland can all move out to Washington state (where it's so much better, they imply) and find new work -- something meaningful, say, as cashiers at Target.



There is a bit of hypocracy and pettiness going on in Washington.  I've watched a bit of the proceedings and was surprised at the venom poring out of some of the Representatives and Senators.  They may be representing the interests of their states and constituencies but refuse to look at the larger picture.  Some relish blaming the Auto CEOs for the failure of the economy while dismissing the Wall Street bailout as a basic need; essentially implying that labourers aren't as important to the US economy as the bankers and brokers of Wall Street.  They don't seem to understand that employment is the critical factor, at the moment, and the crisis will only worsen as the unemployment rate increases.  Some of them, truly, are small-minded.

[Nethead]

I don't know how valid it is, by my view is...

The imports got their foothold in the NA market during the first and second energy crisis when their cars were cheap to run and didn't need a bunch of efficiency and power strangling pollution devices to pass emission laws.  The NA automakers, in the early '60s, gave some attention to producing compacts, Falcon, Dart, Corvair, et al, but somehow that got lost in the musclecar era.  These cars were competing against imports from the UK and Europe.

By the time of the real energy crisis, combined with stricter pollution laws, NA didn't have much to offer and the imports, Toyota, Honda, were starting to show up; and they weren't really very good cars for the NA climate...especially cold and damp weather areas.  Perhaps a bit better that the UK models but not as good as domestics.  However, being cheap to run, many households bought them.  The kids growing up in those households, rather than becoming a Chevy, Ford and Mopar fans, became a Honda or (god forbid) Toyota fans.  Eventually, they became import fans in general and this led to the tuner (riceboy) era.

The real decline of the domestics happened from the mid '70s through to the '90s.  Either through complacency or bad management, or they were simply waiting for the bad times to pass, they all but ignored product; with a few exceptions like the Taurus.  The economic boom of the '90s was a mixed blessing; and may well have sealed their fate.  Cheap (relatively) energy spurred the consumer demand for trucks and SUVs...guys were embarrassed driving vans and saw a great compromise in SUVs; women as well.  The domestics responded by putting all their development resources into SUVs and trucks.  In the late '90s they were all bulging with cash and went on shopping sprees in Europe and Japan.  Then the bottom fell out and by the early 2000's they had started to wake up to the reality...at least Ford did; likely spurred on by the infamous Firestone fiasco.  It was then that they realized that they needed to plug some enormous holes in their product line or the ship would sink.

Many details need to be plugged in, but that is the gist.

FoMoJo:  Hands down the most perceptive posting in this thread!  All added something worthwhile--but this posting is the lighthouse in a hurricane.  Well said, Buddy!

[FoMoJo]

dazzleman, Nethead, thanks for your kind comments.

We complained greatly about the "beancounters" at the domestic brands over the last few years.  No doubt beancounters are needed at any large corporation in order to keep costs under control but they should never have any influence over the decisions regarding product development.  The beancounter mentality of "bottom line rule" may well have influenced the decisions of the domestics to take the short view and focus on trucks as long as the public were willing and able to buy them; giving only token regard to NA car development.  Rebadging second string imports has never worked very well either; as GM is fond of doing.  There is no technological growth in doing that and no profit either.

Given that the bailouts are likely to be approved using the funds set aside for technological growth, doesn't bode well for government plans that the domestics can be technological leaders.  The loans should be contingent on the necessary hacking and slashing of all aspects that are not profitable; save research and development.  In short, the companies need to start over again by building the true cars of the future allowing only the current brands which are profitable to survive.  This will shrink the companies considerably but if there is any hope for the domestics to regain the mantle of technology leaders with prospects for future growth, especially employment growth, they must take this hit now; and, unfortunately, so must thousands of their employees.  They exist now only on borrowed time, imo.

[r0tor]

bah, you can't tell us what to read!

http://www.popularmechanics.com/automotive/reader_rides/4293188.html

I tend to agree with the diesel engine, V8-6-4, and the EV-1 as each setback their perspective technologies 10-20 years or more in this country.... christ diesels still haven't really taken ahold yet once again