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- jboitnott, on 11/12/2008, -1/+56The underlying problems with our economy are so large that they go beyond just American automakers. People aren't buying cars in general.
- oldgal, on 11/12/2008, -1/+3We bought a new car last week for cash. The truth in lending portion had the loan terms spelled out on the contract - 19.9%. If we were going for a loan I suspect we could have negotiated better terms, but 19.9% would not be a fun starting point. On the up-side, got a great deal.
- theviceroy, on 11/13/2008, -0/+1wow you can afford to buy a new car straight out with cash! go ***** yourself!
- Supergliding, on 11/13/2008, -0/+1you could too... if you quit buying american cars that depreciate faster than you can pay them off... and quit smoking... and quit overpopulating the earth... and... and... oh, and don't forget, engage your brain... LOL
- noblepaladin, on 11/13/2008, -0/+5This is the nature of the auto market. During good times, people may replace their cars every 6-8 years. However, when times are bad, they will tell themselves, maybe I'll wait one more year. The auto market can be very brutal because once the economy is bad, everybody says "I'll wait one more year before I get a new car", and sales go way down. Many other consumables like food or gas, people have to buy regardless. The car (or other appliances like a new TV when the old one still works, etc) is usually one item that people can delay for one, two, or even more years.
- oldgal, on 11/12/2008, -1/+3We bought a new car last week for cash. The truth in lending portion had the loan terms spelled out on the contract - 19.9%. If we were going for a loan I suspect we could have negotiated better terms, but 19.9% would not be a fun starting point. On the up-side, got a great deal.
- PatNolan, on 11/12/2008, -9/+66Toyota isn't really in trouble. Toyota's profit was ONLY $6.9 billion - yes, that's billion with a B.
Let the Big three go under and maybe we can get the small seven car makers some actual national distribution and sales.- melville248, on 11/12/2008, -16/+8If the big three go under, no one will be buying cars for a long time. The US economy will be a much bigger mess!
- PatNolan, on 11/12/2008, -7/+22That isn't true. There are businesses and people with money to invest that will buy those factories and put those workers to work. Granted they won't be paid the kingly union wages, but they can make a decent living and produce a good product.
- mayer50, on 11/12/2008, -3/+5That would take a long time, what happens in the mean time, the economy falls apart!
- perfectsilence, on 11/12/2008, -3/+14why stop at the auto industry? let's bail out the airlines, Circuit City, Mervyn's, or any company that's in trouble.
- siszam, on 11/12/2008, -5/+5Oh yeah Patnolan, because the thing we need right now is lower wages for the average worker while big exacts get huge bonuses.
/s - UselessTrivia, on 11/12/2008, -1/+5People need cars, so someone will make cars. Since the banks have had major capital injections and the credit markets are thawing out a bit, if the Big Three or the major airlines start going bust, other companies will come in and buy up the physical assets at pennies on the dollar.
They will be in a fantastic position to make money. The same thing happened with fiber optics. Billions of dollars worth was laid in the 90s, never got used, the companies went bust and other investors bought it up on the cheap, making their success much easier. - Matt2k, on 11/12/2008, -1/+4I don't know if the demand for cars is so much "need" as it is "want"
I've been driving the same '98 Cavaleer that I bought when I worked for $7 an hour. Changing the oil regularly, doing maintenance. If anything breaks, I'll probably just fix it rather than buy a new one.
Contrast that to the people down the street who have bought three new cars in the same period of time (?). No joke.
The only thing that might convince me to buy a new one is if the price was right, and they were *really* energy efficient. (Although I guiltily admit that isn't so much an issue now that gas is back down to $1.80) - yojiffyskippy, on 11/12/2008, -1/+7OMG! What happens if we start using the cotton gin?
OMG! What happens if we allow the dot.com bubble to burst?
Here's what happens. Non-profitable companies slow/stop production and go out of business or innovate. While the profitable companies grow and increase production. Some employees move to the profitable companies and some employees make career changes. Some communities will be negatively impacted while others will not.
Here's what a bail-out will do -- In the short term, some GM executives and union bosses will get to go on more retreats and pad their golden parachutes. They've had almost 40 years to change since the last auto industry crisis and haven't done it yet. Do you expect them to do it now? Not likely. In the long term, nothing will change and they'll be back asking for more handouts. - sleazycheese, on 11/13/2008, -0/+0@siszam
Exacts? Execs, maybe?
Jesus Christ, do you really think it's unreasonable to lower the wages of employees when a company is almost BANKRUPT? Delta employees voluntarily took pay cuts to prevent Delta from going under. Better to have some salary than no salary, right?
What's your alternative? Not cut overhead and just let the American taxpayer bail them out? - Supergliding, on 11/13/2008, -0/+1It's no different than the banking industry. WaMu goes belly up... stock goes to nothing... Chase buys them out for pennies on the dollar (because they still have money)... the rich get richer because the stupid ones are stupid.
- MWeather, on 11/13/2008, -0/+2"If the big three go under, no one will be buying cars for a long time. The US economy will be a much bigger mess!"
Bigger than 60 trillion in worthless derivatives?: That's like worrying about a leaky pipe when there is a hole in your roof and a hurricane outside. - StaticThunder, on 11/13/2008, -0/+2Honestly, people love free markets when its not THEIR job that is about to be outsourced. How the tables have turned.
American airlines can't turn a profit, American rail can't turn a profit, American auto fails turn a profit, Banks failed to turn a profit. Has anyone considered maybe its because all of them are not competing in the marketplace, but are using government to enforce their monopolies through bailouts? How can a startup compete when the established businesses aren't even allowed to go bankrupt when they offer a crappy product?
I hate air travel. I didn't use to. With every bailout package, airlines have offered less amenities and made flying more of a chore. I would travel rail, but look how expensive and difficult traveling on Amtrack ticket is, when it ought to be cheaper than flying, it certainly is more intrinsically efficient. I'd buy an American car, but I want an efficient, small car, not a truck, not an SUV. And yet we wonder why they are having trouble?
- Dumbledorito, on 11/12/2008, -3/+35I was listening to a commentator on NPR's "Marketplace" this morning, and he had an idea that had appeal: The ordering of cars in a similar way we order computers. You pick features, colors, etc., and its assembled for you and delivered at a later date. naturally, the showrooms would still have cars you could test drive and so on, but the PC-building model would be coupled with the elimination of "model years" which creates a ***** of excess and "wasted" production; improvements to cars would come in the same way they do with computers (engine upgrades, new gizmos for the chassis, etc.).
- RevChris, on 11/12/2008, -1/+10Wow , thats great.
It would require the creation of standard parts / connection mechanisms but still its a great idea. - Aleman360, on 11/12/2008, -0/+7The computer industry is somewhat moving away from that though. Dell and Gateway, both of which used to be exclusively build-to-order, now seem to be shifting to selling pre-configured computers at retail. Very interesting idea though.
- Brian48216, on 11/12/2008, -0/+10Mini already does this. They have a few cars in the show room and a few that people have ordered but decided not to follow through with, but the vast majority of minis on the road are custom ordered on an as needed basis. You put your order in, two months later, the car shows up.
- JeffH, on 11/12/2008, -1/+2It's a great idea, but it would be interesting to see on a large scale.
Just imagine how many car buyers are impulse buyers. When they have to wait two+ months for a car, they're gonna make a more informed decision, but who knows if it will actually help auto-sales. I don't think the majority of auto sales are impulse buys just because they cost a lot, but also I don't like the idea of paying so much for something that isn't an instant gratification. - subterfuge, on 11/12/2008, -0/+3doing it that way costs more money, though, for both producer and consumer. it's cheaper to buy a pre-made car the same way it's cheaper to buy a pre-made car and even a pre-made (pre-fab) home.
- Matt2k, on 11/12/2008, -1/+3> doing it that way costs more money, though,
Costs more than going out of business? The margins can be increased, if necessary.
The auto industry has rotten spots through and through that need to be eliminated before any serious reforms occur. I think the build-to-order idea has some interesting merits.
> ell and Gateway, both of which used to be exclusively build-to-order, now seem to be shifting to selling pre-configured computers at retail.
I think the difference there is a $500 home workstation is a bit different. If you misjudge a little, you don't have a billion in inventory sitting on a lot. - secrity, on 11/12/2008, -0/+4That used to be how cars were sold.
The difference between custom ordered computers and custom ordered cars is that custom configured computers are delivered just a few days after they are ordered.
Unless it is a new, not yet released car model, people won't wait two months for their car to be delivered. - Matt2k, on 11/13/2008, -1/+1> Unless it is a new, not yet released car model, people won't wait two months for their car to be delivered
I suppose the question is: Could we wait for two months for our car to be delivered.
With a small showroom inventory for those who need a car NOW, with the bulk waiting in a factory two months out, is this a feasible option. My gut says "Yes" - heybigjohn, on 11/13/2008, -0/+2Not a new idea. All of the automakers have offered this for years, it is not required to buy a car off the lot. I ordered my car 5 years ago this way, picking the color, options, and packages. Are all of you posting here saying you weren't aware that you could specify a car to be built, negotiate the price, and pick it up 8-10 weeks later?
- secrity, on 11/13/2008, -0/+1heybigjohnheybigjohn; I knew that it was still possible to order a bespoke car, it just isn't done very much any more. For the majority of imported cars, other than colors and trim levels, most of the customization is done with dealer installed options.
Dealers also do a lot of trading around. When my partner wanted a specific F-150 with King Ranch package, the local dealer found a truck that was painted and equipped exactly like he wanted it at a dealer that was about 300 miles away. He got the truck that he wanted in a couple of days.
When I was shopping for a new car about a year ago, I found that the local dealer could get a Toyota or Honda (various models) with the exact color and options that I wanted, either from their own stock or from another local dealer. There was a problem that dealers tried very hard to convince customers that all of their cars came with a dealer installed option packages, and different dealers had different packages. The dealers really didn't like it when I told them that I didn't want those options, but they would delete them. I also shopped for a Ford Focus, and those were much harder to find. - Supergliding, on 11/13/2008, -0/+1I always love listening to 30 year olds come up with new ideas... that we 60 year olds already experienced 30 years ago... LOL I've worked on automotive assembly lines... sold cars for several years... and I've owned over 50 cars... and I'm always shopping for my "next" car :-)
It's MUCH more efficient to build cars like Honda does... 3 trim levels, that's it! Those options don't cost the manufacturer that much per option, except for things like automatic transmission and air conditioning. It's less costly to just include them than go thru the extra cost of inventory control and separate assembly routines. Anyone who's ever built anything in multiples should understand this.
What would be much more efficient is to build cars like Volkswagen did with the Beetle years ago. Start with a good basic product, and keep improving it every year. It's a bummer when we have to wait 5 years to get rear doors on our pickups, because they wait till the next major model change... for example.
GM needs to do away with half of its divisions. The dealer network is gonna bitch, because half of them won't have cars to sell... but it's better than having GM go out of business. It's extremely important to keep manufacturing facilities viable in the US !!! If we ever go to war again, like WWII, we have to have the capability to manufacture war machines... DUH It pains me deeply that we've exported way too much of our labor capability, manufacturing capability... and the natural resources to build things to China and India !!! So if we need to go to war with China, what do we do? Order tanks from China? - catbeller, on 12/17/2008, -0/+1Alvin Toffler outlined the idea in "The Third Wave" almost thirty years ago.
- RevChris, on 11/12/2008, -1/+10Wow , thats great.
- nesstheking1, on 11/12/2008, -1/+3It would be bad if they went under, they are a strong arm of the economy. Granted not as strong as it used to be. If they go down they take away pensions of retirees with it.
The big 3 (or just gm, that's all that's important to me) need to make affordable efficient cars. If they did that then they would be back on top.
Make the EV09!- PopcornDave, on 11/13/2008, -0/+1They need to make cars that people want to buy. That's the problem that they had back in the 70's when the Japanese kicked Detriot's ass.
Now if those cars are electric, hybrid or gas it doesn't matter, but they need to be affordable and desirable.
- PopcornDave, on 11/13/2008, -0/+1They need to make cars that people want to buy. That's the problem that they had back in the 70's when the Japanese kicked Detriot's ass.
- JeffH, on 11/12/2008, -0/+7We're likely to see an automotive bailout sometime in 2009, or at least that's what I predict.
It sucks, but honestly the auto industry already has pretty solid plans for a comeback with stuff like the Chevy Volt.
The government won't let Detroit crumble, just like they didn't let the banks crumble, but at the very least they're not spending millions on exec retreats and some actually have solid plans for the future.- tmcal, on 11/12/2008, -0/+6Well, from the news on CNBC and elsewhere, GM and Ford aren't likely to survive to 2009 if they don't get help ASAP. Once they have a cash flow problem, that's it. Chapter 11. Not many come back from that stage.
- acknotSW, on 11/12/2008, -0/+0Maybe Ford would have to sell the lions? Only upside I can think of.
- aletoledo, on 11/12/2008, -1/+6Solid plans for the future? Where were these plans ten years ago? Bad management is simply bad management. These execs probably sold great plans for building fleets of SUVs ten years ago, playing them as a solid plan. Their previous plan failed miserably and there is nothing to suggest that their new plans will work.
If a bailout is passed, then at the very least everyone in middle management and above should be fired and replaced. Promoting bad leadership for the next 10 years isn't going to solve anything. If the cronyism of this bailout won't allow for executives to be fired, then we as citizens should gain control of the future plans of these companies. If they're working on my dime, then I don't want them making more SUVs. - JeffH, on 11/12/2008, -1/+2And...they won't.
Honestly, the workers and bigwigs at GM and Ford aren't retarded. They may have hit the energy efficient market way later than anyone else, but that's what they are aiming for now.
Believe it or not they actually want to become viable companies again, and believe it or not the good people at GM and Ford know what direction they need to go and have already started rapidly down that path. - noblepaladin, on 11/13/2008, -0/+3It may be too late though. The government isn't retarded either. They will only give bailouts to companies that have a chance of paying back the bailout loan. GM is burning through 2 billion dollars a month. If they get the bailout, it's as good as gone and they will come back in a few months. GM needs to make massive changes before a bailout can happen. They can't keep paying unskilled union workers $73/hour at the taxpayer expense: http://seekingalpha.com/article/105061-should-we-r ...
- whorunbartertwn, on 11/12/2008, -0/+3I was thinking the same thing. The word trouble when used for a company that's seen it's stock slide but still has lots of cash on hand, no debt, and "only" had a 7 billion dollar profit last year is kind of a stretch when compared to American automakers that are losing billions and might not exist in the near future.
When author claims Toyota doesn't lay off workers he also misunderstands what Toyota calls it's variable workforce which is really just thousands of long term temps that they have (and do) cut by the thousands.- Tarandon, on 11/12/2008, -0/+4Ditto... Is that allowed?
Also, they only declined 17% below the market expectations, and the rest of the market has declined almost 71%. That would suggest to me that the company is extremely strong considering the market.
- Tarandon, on 11/12/2008, -0/+4Ditto... Is that allowed?
- stoanhart, on 11/13/2008, -0/+1No *****. On top of the $6.9 Billion profit, "it has a fat $18.5 billion cash cushion, almost no debt and a big lead in clean technology led by the Prius." The main point of the article seems to be that they have been expanding rapidly, and now demand has dropped, so their profits will be less than predicted for a little while.
Buried as inacurate.
- melville248, on 11/12/2008, -16/+8If the big three go under, no one will be buying cars for a long time. The US economy will be a much bigger mess!
- phreak79, on 11/12/2008, -2/+49I'd bank on Toyota to get out of this though. Their lean manufacturing system is incredible at cutting waste out of the production process, which is exactly what's required to weather a recession. GM on the other hand...
- vertigo32, on 11/12/2008, -2/+4The ***** of subsidies the Japanese government provides really helps too. When pensions and health care are socialized, it really takes a lot of the legacy costs off a business. Not to mention the guaranteed profit of not really having to compete at home.
- Smogtdi, on 11/12/2008, -1/+9then why do GM is closing manufacturing in Canada ?
we also have pensions and health care socialized...
GM need to listen to market but also offer models that sells in troubled times
when car manufacturers are considering a 8L/100km small car "eco efficient" (hint dodge caliber), you know there's a lot of work to do. (hey, even the gmc canyon/colorado pick up are rated at 7L/100km)
I think they should match the security and emmisions laws to what they have in Europe so we can get the same cars without expensive modification from manufacturers. - balthisar, on 11/12/2008, -9/+1Yeah, but the Canadian plant builds gas guzzlers. That's what GM has to shutter.
EU cars are dirty and not very safe compared to US/Canada standards. You'd want us to to sell those here? Why not Chinese-market cars with foam under the fascia instead of a bumper? - Netizentalk, on 11/12/2008, -1/+7"EU cars are dirty and not very safe compared to US/Canada standards."
WHAT??? You should inform yourself... Most US cars cannot be sold in the EU because they are to dirty and unsafe... - Rioracer916, on 11/13/2008, -0/+2Oh no! The scary "S" word!
*runs and hides under the bed*
Funny thing is, U.S. businesses are in talks with congress right now.
Business AND Congress are siding with Hillary's plan of involuntary Government health insurance (as contrasted to Obama's voluntary plan, not that it isn't a step in the right direction).
Seems like socializing health insurance cuts costs for both employers and employees. Canada, Japan, Britain, France, Germany (what the hell, most of the EU)...basically some of the biggest democracies and economies have something in common.
Funny huh? Oops, I forgot oooooh Socialism...scary! - Coolkid11, on 11/13/2008, -3/+1The reason that GM is failing is because the union is nickel and diming them to death, and there are so many policies and regulations that are intrusive to building new car models. Another problem is that the GM Union is holding back automated car manufacture because employees would get fired.
- Smogtdi, on 11/12/2008, -1/+9then why do GM is closing manufacturing in Canada ?
- darkciti2, on 11/12/2008, -0/+2Some Toyota's are actually more American than GMs or Fords. GMs and Fords tend to be built with around 75% domestic parts.
The Toyota Sienna has 85% American-made parts.
- vertigo32, on 11/12/2008, -2/+4The ***** of subsidies the Japanese government provides really helps too. When pensions and health care are socialized, it really takes a lot of the legacy costs off a business. Not to mention the guaranteed profit of not really having to compete at home.
- adrunasinger, on 11/12/2008, -10/+20"I want a good green tech car- not too expensive-
not the old dull smoking garbage wagons they dress
up then push on us- had too many years of
seeing that crap and I'm sick of it. I want
something that looks interesting to build, fun to
drive- smart. I want the company that makes it to
be smart so I don't feel like an idiot supporting
their moron manufacturing culture. If these
companies can't get the message and scrape their
talents and assets together then let them find
another business and let those with real enthusiasm
do the job. These old jerks are the same kind of
guys who reclaimed the EV1 from happy owners and
put them through concrete shredders in Nevada- real
nit wits. Just how dumb do you have to be to do
something like that? They apologized later but I
think it was only because they got caught in the act.
I don't necessarily want them to sink but if they are
inclined to be hostile to intelligent and earnest
consumers then why should I hold their hand while
their dumping their garbage on myself, my family and
my friends? Should I pretend I'm an idiot and I don't
see what's going on? What would I get out of it? What
do any of us get out of it? It's the biggest turd joke
I have ever heard in my life. Too bad it isn't funny."
This from a 14 year old in a History class.- adrunasinger, on 11/12/2008, -0/+4yeah yeah- their dumping --> they're dumping. He knows better now.
- sleazycheese, on 11/13/2008, -0/+0Did he write it in a 40-character-wide terminal?
- adrunasinger, on 11/17/2008, -0/+1Who said it was a he?
- adrunasinger, on 11/19/2008, -0/+1Doh! I guess I did! Anyway- I contest that the the point remains.
(His girlfriend is even more annoyed) yahar!
- 80hd, on 11/12/2008, -1/+6dwindling faster than a keg at a frat party
Is that all they think we relate to?- cyrusuncc, on 11/12/2008, -4/+7dwindling faster than Palin's credibility during the election?
- shaftbond, on 11/12/2008, -0/+4dwindling faster than GB's on your porn hard drive?
- counterplex, on 11/12/2008, -0/+3dwindling faster than your money in the stock market?
- ifruit, on 11/12/2008, -17/+23Detroit is tanking because of labor unions. (The same reason public education sucks)
- inboxnews, on 11/12/2008, -3/+17It costs GM $3,000 more in labor to build each car than Toyota or Honda. That's the problem--Labor Unions who forced GM to sign those contracts meant the eventual end of GM. I say, let GM die. Better sooner than later.
- yojiffyskippy, on 11/12/2008, -0/+3Short term greed wins every time.
- absentmindedjwc, on 11/12/2008, -10/+6there is nothing wrong with unions... they provide safety and security for employees...
that said, if the company is, or is trying to become, an HPO.. unions are a terrible idea. They will shoot down the company every time because the employees will have no reason to be in the union.
btw, HPO stands for high performance organization, for those not business savvy, lol- absentmindedjwc, on 11/12/2008, -2/+5anyone digging me down does not know what an HPO is...
imagine what would have happened if google was union before they gave employees all the benefits. The unions would have fought google every step of the way trying to keep the status-quo. Remember, union leaders make money if the company does not have pro-employee policies in place (insurance, profit sharing, etc).
I covered this subject quite extensively in one of my MBA courses and came to the conclusion that unions could only hurt the employee if a company decides to go in this direction.
This is not to say I am anti-union though. For a company that believes employees are as disposable as a paper towel, unions are the only way to ensure the safety and security of the employees. However, if the company wants to go in the direction of those like Google, the company will be fought by the union. After all, if the company believes that employees are their most valuable asset, and treats them as such by giving them great benefits and job security, nobody is going to want to pay union dues. - acknotSW, on 11/12/2008, -0/+6There is a problem with unions. They provide safety and security for many employees who do not deserve it.
True story: I worked for a company that supplied some oil and chemical cleaners to one of the big 3 for their parts cleaners. In the break room, they had a big plastic jug of fruit punch. The top of this thing had chains and locks on it and it was strapped to a steel bench. I asked one of the guys what the deal was the chains and stuff, mainly wondering if someone had been pouring alcohol in it or something. The answer was so much worse. It turns out about 3 months before they caught a union guy taking a piss in it. I said something like "I assume he got canned for that". Nope, they got his named changed and placed him in a plant down in Ohio. They even paid his moving expenses. Now that's a pretty extreme case, but if you walk around at any of the big 3 lines, you can find LOTS of people just sleeping. I can't even begin to tell you how many liquor bottles I used to find while doing my rounds. - AutoXer, on 11/12/2008, -4/+3Safety is handled by OSHA now. Unions aren't needed for that.
Job security? Job security should come from the employee doing a good job.
There was a time for unions; that time has passed. - Valyn, on 11/12/2008, -0/+3@acknotSW
I agree. Same problem I had with coworkers in the military. you can't be fired, so the idiots end up sticking around. Except the idiots get stuck doing nothing but BS labor like mopping and waxing. While I have to do twice the work now. We would still get paid the exact same as well (for about a year anyway, until I finally get promoted). - acknotSW, on 11/13/2008, -0/+0Good for you Valyn and thanks for your service. I just want you to know that there are at least a few people here on SW who appriciate what you guys do for this country.
- absentmindedjwc, on 11/12/2008, -2/+5anyone digging me down does not know what an HPO is...
- bullhead2007, on 11/12/2008, -1/+5Wrong. I'm willing to pay a little bit more for American made if the quality is there too.
Too bad GM and Ford have been turning up *****, and stuck to their SUV/Flatbed gas guzzling ***** market.
They're tanking because they haven't been as innovative or as reliable as the japanese/korean cars. - oldgal, on 11/12/2008, -1/+5GM is tanking because of piss poor management.
- noblepaladin, on 11/13/2008, -1/+1At $73/hour, I think there is something wrong with unions: http://seekingalpha.com/article/105061-should-we-r ...
- inboxnews, on 11/12/2008, -3/+17It costs GM $3,000 more in labor to build each car than Toyota or Honda. That's the problem--Labor Unions who forced GM to sign those contracts meant the eventual end of GM. I say, let GM die. Better sooner than later.
- Psuper, on 11/12/2008, -3/+18If a business model fails, let it fail.
Im not sinking money into something that is failing.- jerrycan, on 11/12/2008, -1/+2Yeah, but you govt. is so too phucking bad. America needs a second revolution. The government is no longer for the people. It is just a tax extraction device for big business. NOW GET BACK IN THAT STORE AND EXTEND YOURSELF!
- absentmindedjwc, on 11/12/2008, -1/+6but in this case (toyota), it is not necessarily the business model that is failing, it is the market that is failing.
If Bob sells widgets and nobody can afford them because money is tight, Bob will stop making money and may eventually close. This is in no way a bad business model, this is just a risk of doing business, there are times when the economy is doing poorly and it is hard for business to survive.
Failed business models are what you are seeing from Detroit. You are seeing companies that are not changing to try and better themselves. How many Ford cars get over 30 MPG? How long did it take for them to get those?
I do, however, agree that companies should not get bailed out, that is capitalism at work. - dagamer34, on 11/12/2008, -0/+2You do realize that the entire Rust Belt economy is built on top of auto manufacturing, Michigan in particular. Letting a couple of states go into SERIOUS recession would spread across the U.S. like an infection.
- Rioracer916, on 11/13/2008, -0/+1But throwing away hard earned tax dollars, forcing government to raise taxes EVEN MORE, will only crush the middle class and the poor who are barely hanging on right now.
Sometimes you gotta take your shots if you want to get better.
You can't save everyone all the time.
- Rioracer916, on 11/13/2008, -0/+1But throwing away hard earned tax dollars, forcing government to raise taxes EVEN MORE, will only crush the middle class and the poor who are barely hanging on right now.
- taiwanniggadu, on 11/12/2008, -4/+40stop building those damn suvs
- bigsteve, on 11/12/2008, -1/+3Comparing to production from 4-5 years ago, they effectively have. All SUV sales are way down.
Though somewhat related, I think that Escalade Hybrid looks neat. I've always liked the Escalade though I wouldn't dream of buying an SUV.- Smogtdi, on 11/12/2008, -3/+2adding a bigger alternator-starter-battery don't make it hybrid.
GM must stop pushing it's *****
- Smogtdi, on 11/12/2008, -3/+2adding a bigger alternator-starter-battery don't make it hybrid.
- jgopp, on 11/12/2008, -0/+3The companies wish they could. I worked at Chrysler the last 2 years before I got into college. I was in their supply division, which aids in vehicle testing from concept to product. The problem is that SUV's were so hot back in 2002-03 they decided to keep turning them out. You have to remember it takes almost 5 years to get a vehicle from conception to production, there are many many things that must be checked, regulated, and the quality needs to be of a decent degree. So we are seeing the conceptual products from 5 years ago finally making it to market and it couldn't be at a worse time unfortunately. The only fast option is retooling plants for the manufacture of the smaller euro market cars.
- yojiffyskippy, on 11/12/2008, -0/+4They build them because people buy them. The problem is that they aren't smart enough to recognize changes in the market and disciplined, quick, or nimble enough to respond to them.
- arkaycee, on 11/12/2008, -0/+8A buddy of mine retired from Chrysler fairly recently, and told me he watched a lot of projects just keep going and going and going because of pride, or at least the inability to admit to a problem that might be traced to poor decision-making on the part of that manager or his/her fellow managers. He told me about an engine that was to be a high-performance engine that, fairly early in the game, everyone knew pretty much would be so heavy and inefficient that it would be a dog... but they kept right on with it because, you know, they had already sunk so much $$ into it, and well, no one directly connected to managing its design and inception wanted to admit that they or their fellow managers had messed up ... so it went to market and was panned in all the vehicles it was used in.
- oldgal, on 11/12/2008, -0/+2Just got a Jeep Patriot. Gets 26/30 mpg. which is better than most small American cars do. Needed a car that could haul stuff and couldn't afford a hybrid. For $14K couldn't be more pleased.
- bigsteve, on 11/12/2008, -1/+3Comparing to production from 4-5 years ago, they effectively have. All SUV sales are way down.
- 3Den, on 11/12/2008, -2/+13I would like to request a bailout as well - I think everyone should get one.
I've got good savings, no debts, and I made a healthy profit last year - but it could have been higher if it were not for the US rececession - its' only fair that I am compensated for this so I can continue my current lifestly.- yojiffyskippy, on 11/12/2008, -2/+4lol, Ooo! Ooo! Me too! Me too! I want a bail out too.
- acknotSW, on 11/12/2008, -1/+1This guy owed me $400, so in anticipation of him paying me, I bought a new driver. Well, I never saw him again and now I've got $400 on my credit card that I'll never get paid off. I would also like to request a bail out or else I might not be able to golf as much next year.
- dshPls, on 11/12/2008, -4/+9My GF drives a Toyota corrolla and it's been to the shop multiple times, she got it new too... my Honda on the other hand is in perfect mechanical shape, I've not had a single problem yet. I'm starting to think that Toyota's quality is going in the *****. At the same time my girlfriend is a bad driver and has probably damaged the car way more than the average driver.
- 4thcage, on 11/12/2008, -0/+10let your gf drive your honda for a while, then we will know if toyota quality is ***** or ur gf is *****.
- yojiffyskippy, on 11/12/2008, -0/+1Or you and I could swap girlfriends for a while. If you know what I mean. Amirite?
- SniperGX1, on 11/12/2008, -0/+11A sample size of one on each side is hardly enough information to make any conclusions.
- pak314, on 11/12/2008, -0/+5get two girlfriends then.
- pak314, on 11/12/2008, -0/+5get two girlfriends then.
- rlvis, on 11/12/2008, -0/+3My Corolla has been great. I've had it for 5 years with no problems.
- absentmindedjwc, on 11/12/2008, -2/+3try a Hyundai, those are some pretty nice cars
- Valyn, on 11/12/2008, -2/+2LOL
- 4thcage, on 11/12/2008, -0/+10let your gf drive your honda for a while, then we will know if toyota quality is ***** or ur gf is *****.
- narcofiche, on 11/12/2008, -10/+17Detroit isn't tanking because Japan makes better cars, it's because Detroit makes ***** cars.
- rumorsofdemise, on 11/12/2008, -5/+12it's not a quality gap, it's a perception gap.
- publiclurker, on 11/12/2008, -3/+5Right, people are able to readily perceive the difference.
My last car was a Chrysler. Our current low end Acura is over 10 years old and still runs like a champ.
- publiclurker, on 11/12/2008, -3/+5Right, people are able to readily perceive the difference.
- vertigo32, on 11/12/2008, -4/+11Detroit is tanking because it's cool to trash American cars.
There are exceptions (Chrysler...) but quality is about the same across the board. The problem is that on a scale of 1-10, a GM or Ford nameplate automatically costs a vehicle 2 points simply on perception. Something is wrong when the Toyota Matrix scores significantly higher in reviews than a Pontiac Vibe when they are the exact same car.
But hey, for all these people who say "Let the Big 3 fail, I'll keep buying Honda / Toyota" - when they fail, this country's back is going to be broken. We might recover, but those UAW jobs, white collar jobs, service jobs, tier 1, 2, and 3 supplier jobs, shipping / logistics jobs, engineering jobs, etc that depend on the Big 3 aren't going to be the only ones being lost. All of the service industries will find that there isn't anyone left to service.- Rioracer916, on 11/13/2008, -0/+1American cars had 2 decades of crap coming off the assembly lines.
It's not the consumer's fault that companies tarnish their own brand image. - sleazycheese, on 11/13/2008, -0/+0If/when they fail, they won't vanish. Investors will buy them out and revamp the companies.
- Rioracer916, on 11/13/2008, -0/+1American cars had 2 decades of crap coming off the assembly lines.
- jgopp, on 11/12/2008, -1/+4I don't know, my family drives all american cars. I have a ford fusion, my brother has a mazda 6 (built in flatrock MI, mazda is part of ford if you didn't know), and my mother has a CTS. And we couldn't be happier, I used to drive a 03 ford focus and loved it. Now I'm in an 07 fusion, had it for about a year and a half and haven't had to take it to the shop for any reason. I think if the general consumer really went and seriously looked and researched the new fords they would probably end up buying one.
- inboxnews, on 11/12/2008, -1/+10Negative, GM is failing because it cost's them an additional $3,000 in labor to build each car. They cannot compete with Japan's labor costs.
- zigardne, on 11/12/2008, -0/+9if GM didn't have to provide pension or health insurance they'd be on equal footing for labor and overhead, and despite perceptions, the quality gap has disappeared over the last 7 years.
- vertigo32, on 11/12/2008, -0/+11If you take out the health care and pension costs, the US is actually ahead though - the average American worker is more productive then the average Japanese worker.
The difference is that the Japanese government subsidizes Toyota and Honda through socialized health care and pensions. Ironically, one of the biggest reasons that the Japanese auto makers have come to the US (other then marketing, transport isn't really that expensive) is that by employing American non-union employees for $10-14 / hour, they avoid having to pay even those significantly reduced health care and pension costs. - inboxnews, on 11/12/2008, -1/+4@zigardne, @vertigo32 -- Excellent points.
- adairnic, on 11/12/2008, -1/+3Toyota's are made in KY...by Americans, in the USA.
- zigardne, on 11/12/2008, -0/+2@adairnic,
they're assembled here with manufactured parts from japan, b/c its cheaper to ship the parts over and put them together here, but to say they're made here is a stretch.
- RizzoFrank, on 11/12/2008, -1/+3Detroit's cars are quality cars. If shmucks weren't paid $35/hr to bolt two piece of sheet metal together all day, then prices would be cheaper. Domestic and foreign car companies use the same design houses to design components and tools. The only thing designed really designed by the OEM is the A surface you see on the outside, other than that the same people are designing Ford parts one month, and Honda parts the next month. Tool shops are cutting tools for GM one day and Toyota the next. Detroit need to learn how to negotiate prices and wages better that is all.
- specialbuddy1, on 11/12/2008, -0/+3I agree that they are quality cars and line workers make too much but the shmucks at the top need to be fired when they can't figure out why the business is failing.
- Valyn, on 11/12/2008, -2/+4Exactly. Detriot has such a history of ***** cars that many people I know will never buy an american car. Even if they magically started producing full electric hybrids with a 1000 mile range that recharges in 10 minutes. I'd just wait for someone else to make the same type of car. That I don't believe is going to ***** me 10 minutes after the warranty ends.
- dougs55, on 11/13/2008, -0/+1"Detroit isn't tanking because Japan makes better cars, it's because Detroit makes ***** cars."
I wouldn't know. I graduated college in 1977 and bought a brand new 1977 Dodge Aspen. For many reasons, it was the last American car I ever bought. Digg me down, but no, they don't deserve another chance. Yes, it really was that bad.
- rumorsofdemise, on 11/12/2008, -5/+12it's not a quality gap, it's a perception gap.
- therealrico, on 11/12/2008, -2/+48Dumb misleading title
"Toyota won't go the way of Bear Stearns. It has a fat $18.5 billion cash cushion, almost no debt and a big lead in clean technology led by the Prius."
Why not just rename the title, "Toyota struggles like everyone else because of a recession, but was smart enough in the past to have prepared themselves with no debt, and 18.5 billion in cash!"- jnava121, on 11/12/2008, -1/+7a simple check of their stock price compared to ford and gm, shows they are not going under anytime soon...
The junior college stop teaching economics these days?- Valyn, on 11/12/2008, -0/+1You dont even need to go to JC to read a stock price.
- jnava121, on 11/14/2008, -0/+1WTF is JC ? lol..........
- Coolkid11, on 11/13/2008, -0/+1Because only sensationalist titles will get diggs.
- jnava121, on 11/14/2008, -1/+1because only people who know what they are doing are buying stocks right now ? :) damn obama raising capitalist gains tax when im buyin stocks!!! *****!!!
- jnava121, on 11/12/2008, -1/+7a simple check of their stock price compared to ford and gm, shows they are not going under anytime soon...
- Pwelborn1, on 11/12/2008, -0/+8Bring back the TUCKER!
- scarwars, on 11/13/2008, -0/+1seconded!
http://www.imdb.com/title/tt0096316/
- scarwars, on 11/13/2008, -0/+1seconded!
- MadOgre, on 11/12/2008, -5/+16No Bailouts.
- geoken, on 11/12/2008, -1/+1 When people are looking for something to contrast the poor decisions of the big three against, they usually turn to Honda. Honda is the anti-GM with their bevy of small cars, and large cars (Pilot, Ridgeline) that were derided for being too 'car-like'.
If we made a spectrum were one side was occupied by companies who almost completely ignore any sub 20k car while the other side was occupied by companies that focus on the sub 20k market so much that it actually hurts their higher end products, Toyota would probably be in the middle. - OstrakonX, on 11/12/2008, -3/+30I heard somewhere that buying American doesn't always support Americans, since a lot of Fords and Chevys are made in Mexico and brought over. However, a lot of foreign-owned companies make their cars here to save shipping costs (Honda, for example), and therefore I end up supporting American workers more by buying a Civic than buying a Focus.
I'd rather support an American workforce and a foreign CEO than a foreign workforce and an American CEO. Please digg me down if I heard wrong.- trdrstv, on 11/12/2008, -2/+6I refer to my Honda as a "Domesticated" car. It was engineered in Japan, but made in Ohio.
- queelix, on 11/12/2008, -0/+0I have an 07 Civic (great car by the way) and it was made in Alliston Ontario.
- zigardne, on 11/12/2008, -1/+2The Japanese assemble a lot of their vehicles over here, but they aren't 'made' here.
- SomeRandomGuy, on 11/12/2008, -2/+4And with good reason. If Americans could build cars worth a damn anymore maybe they'd be trusted to do the actual building.
But when I discover things like "the GM plant my friend's husband works at has a brewery on-site" and then I find out that the transmission on my Mazda 626 is from a Ford Probe, a transmission reknown for its failure rate, and so horribly designed that just to LOOK at it, you have to detach if from the car, I can't honestly care less about what happens to the American auto industry.
If they hit hard times, great, maybe they'll pull their heads out of their asses. I've already started hearing the jingoist "Buy American, because you're American, screw those guys from Japan" commercials.
- SomeRandomGuy, on 11/12/2008, -2/+4And with good reason. If Americans could build cars worth a damn anymore maybe they'd be trusted to do the actual building.
- balthisar, on 11/12/2008, -1/+3The American auto industry is *not* just about the 2000 hourly workers that work in a plant. It's about the entire friggin' company. Even though the PT Cruiser is built in Mexico, Chryslers engineers are right here in the United States. And their suppliers. And much of those suppliers' hourly folks. And the technical companies (robots, coneyers, etc.). All right here. The 2000 hourly in a plant is nothing in comparison. While the Asians have /some/ of that here, it pales in comparison to the Big 3.
I'm not saying that all of that is a reason to buy an American car; I *am* saying that it shouldn't be used as a reason to /not/ buy an American car. - arkaycee, on 11/12/2008, -0/+0As a practical matter, the 1st (or first few) characters of the VIN of your car will tell you where your car was assembled anyway (granted, that is only one part of the very complex story of where your car was designed, made, where the company is headquartered, etc., etc.). That being said:
VINs beginning with 1, 4, and 5 are assembled in the US.
http://en.wikipedia.org/wiki/Vehicle_identificatio ...
- trdrstv, on 11/12/2008, -2/+6I refer to my Honda as a "Domesticated" car. It was engineered in Japan, but made in Ohio.
- monkeyvoodoo, on 11/12/2008, -1/+4Doesn't Toyota design and manufacture all of their US lineup in the US? So ... wouldn't this be kind of an obvious turnout?
Who we should really be looking at is Korea. How are Hyundai and Kia doing?- citizen782, on 11/12/2008, -0/+1Hyundai is stable from what I've read. Kia not so much.
- balthisar, on 11/12/2008, -0/+1Same company.
- balthisar, on 11/12/2008, -0/+0All the design is Japanese. It's a world car. Most of the boring models are assembled in the USA, though. See my post somewhere above about the relative unimportance of just the few hourly jobs, though.
- citizen782, on 11/12/2008, -0/+1Hyundai is stable from what I've read. Kia not so much.
- hokie47, on 11/12/2008, -1/+5Cars last a longer now days too. I would like to replace my car for something new, but it runs great and it gets me to point A to point B with out any problems.
- Smogtdi, on 11/12/2008, -5/+0I don't think so buddy. and the older cars are also more fuel efficient and less bloated
- kingmanic, on 11/12/2008, -0/+3Maybe if you compare an old economy car to an SUV but try comparing the old BOATS from the 80's to the newer cars in the same market category and you'll find your statement is full of *****.
- 4NDr01D, on 11/12/2008, -0/+2tell that to the AMC Matador we used to have...
- Smogtdi, on 11/12/2008, -5/+0I don't think so buddy. and the older cars are also more fuel efficient and less bloated
- rayearth42, on 11/12/2008, -2/+3Saved by Zero, my ass.
- sleazycheese, on 11/13/2008, -0/+0That. *****. Jingle.
- Dustin00, on 11/12/2008, -8/+10Everybody is going to have a rough time for a while.
Toyota will continue to kick Detroit's ass because, instead of R&D, Detriot just sent lobyists to Washington to prevent improving fuel economy legislation.
GM had the electric car over a decade ago, then they burried it. They deserve to fall.- Target91, on 11/13/2008, -0/+1They buried it because it failed. Nobody bought it. Can you really blame a company for wanting to forget it's failures?
- tashtego67, on 11/12/2008, -2/+5They have a smaller profit than expected because sales are off in this recession and they do not lay off their employees. However, it's not so bad because they have $18 Billion on cash lying about and a large lead in hybrid technology. Hmmn. They are making profits, have piles of cash, probably some pretty damn loyal employees, and a technological lead. Yeah people sell your Toyota stock for whatever you can get for it. I think I'll call my broker too.
- Netizentalk, on 11/12/2008, -5/+6Ford builds the only more or less good cars...
All other US cars are crap and the only ones buying them are Americans...
Europeans and Japanese people would never buy such ***** cars- Slovenian6474, on 11/12/2008, -0/+2from wikipedia under "buick"
"General Motors, selling vehicles under the Buick, Chevrolet, Opel, Saab and Cadillac names, is the best-selling foreign automaker in China."- popfrogs, on 11/12/2008, -1/+3LOL @ the irony. They send us their junk, and we send them ours.
- DreKor, on 11/12/2008, -0/+3Except Europe seems to love Opels and GM is opening new plants to supply Russia with SUVs. I'm not a US car fanboy by any stretch, but lets get our facts straight.
- Netizentalk, on 11/12/2008, -0/+1Opel is owned by GM but it is not an American car.
- specialbuddy1, on 11/12/2008, -0/+3What European cars are good? The Jetta? Jap > American > Euro trash
- Netizentalk, on 11/12/2008, -2/+2Euro trash?
Mercedes, BMW, Porsche, VW ???
- Netizentalk, on 11/12/2008, -2/+2Euro trash?
- Slovenian6474, on 11/12/2008, -0/+2from wikipedia under "buick"
- kanabiis, on 11/12/2008, -3/+36Wait a minute, Toyota is in trouble because they posted profits lower then expected? Isn't that the case with EVERY company right now?
6.9 Billion dollars profit is in trouble?? Lets compare that with GM's 3rd quarter earnings, or shall I say losses, 2.5 Billion dollars LOST. While I agree sometimes with Wired blogs, lets call a spade a spade here, the author is smoking crack. Yes, Toyota did not make as much as expected, but they are in no way shape or form anywhere near comparison to GM. GM is having trouble paying the bills, Toyota paid all of their bills, employees etc. AND STILL posted 6.9 billion in PROFIT. GM is bleeding money out the ass... to suggest that Toyota is in comparable trouble to GM is dishonest, and truthfully an outright lie.
It amazes me that the same people that claim to support capitalist theory all of a sudden scream for socialist bailouts when capitalism effects their favorite company. Look, GM is failing because of their own mistakes, mismanagement and failure to innovate, capitalism 101. You fail to compete with your competitors, you go out of business, period. Thats capitalism folks.- Mullinator, on 11/13/2008, -0/+1It isn't as simple as that. Toyota also has 130.76 billion in debt. They may be posting profits but it is so small relative to that kind of debt that they are still going to be seeing trouble.
- littlerobothead, on 11/12/2008, -7/+1I'm more left-leaning than most, but I have to agree that a large part of this is extremely lenient labor contracts. When you couple that with a massive pension system, which the unions don't want to pay for, you get some companies that are really in trouble. It's no secret, however, that Toyota and Honda are out-innovating Detroit; case in point is the Chevy Volt, which looks like it will be a total failure if it ever ships—GM reengineered the batteries so many times they lost count, and they're relying on a hybrid system so old and conservative that it makes the Prius look like the Millennium Falcon. They're also desperate to get into bed with the corn industry for ethanol, which in turn wants to be the next oil industry. Stinks to high heaven.
They've spent years lobbying Washington to protect them from having to observe fuel efficiency regulations (fleet average fuel economy is a laughing stock as policy.) Then, they lobbied to be exempt from laws that would have prevented them from selling the huge gas guzzlers they insisted on churning out hundreds of every day. Now they want Washington to protect them from the big bad world of actually having to innovate in order to survive.
It's obvious they can't be allowed to simply default. Three months of GM's profit in 1998, small though it be now, was a 1/3 of our GDP. American automakers need to be divorced from their operating boards and forced to be profitable. These companies need to be aggressively restructured by hard-nosed people who don't have any personal stake in them. And as Americans, we need to undergo a change in how we view cars. Our societies are completely built around them and their ability to take us great distances to do nearly everything. We seem to be the last society willing to trade urban sprawl, financial ruin, horrific environmental implications and rubber stamp lobbying for bitchin' wheels. - jeremyduffy, on 11/12/2008, -7/+1Let Detroit die. Over the course of 80 years they can make a car do almost anything but get better gas mileage and better safety ratings? They're either incompetent or greedy collusionists and I don't see any reason to cry if they dry up and disappear. If they live, it should be because they make better cars than the competition.
- govsucks, on 11/12/2008, -6/+9Well, the American auto makers are suffering from one fatal disease that Toyota doesn't suffer from. UNIONS
That is why Toyota will continue to thrive while the "big 3" will continue to seek taxpayer bailout for the pathetic situation they let the unions get them into.
Must have been that hippy girl GM slept with in the late 60's that infected them with unions. Nasty disease those unions, they can and have destroyed corporate bodies in the past.- DukeRevo, on 11/12/2008, -0/+4German automakers have to deal with unions too, and they're not going anyplace.
UAW did hurt the Big 3, but so did the golden parachutes of executives and the quality gap (or perception of such). It's difficult to place blame on any one factor - it's likely a combination of all three and then some.- sleazycheese, on 11/13/2008, -0/+1Managers who run companies into the ground need to be prosecuted. What former CEOs of Fannie Mae were able to get away with is a travesty. Make an example out of a few of them and the rest will get the message.
Still, some managers are worth every penny. If I'm not mistaken, their salary is determined by the board of directors. In other words, they are paid according to their actual (or perceived) value.
Unions, on the other hand, shakedown companies to increase their members' salaries and benefits. They no longer play important roles in things such as safety with organizations like the OSHA.
A company has one goal--to earn profit for its shareholders. I cannot see why they should be obligated to provide jobs in times when they need to shed them, or why they should have to pay exorbitant salaries to people who could not have negotiated such salaries on their own.
But the unions will just keep bending until it breaks.
- sleazycheese, on 11/13/2008, -0/+1Managers who run companies into the ground need to be prosecuted. What former CEOs of Fannie Mae were able to get away with is a travesty. Make an example out of a few of them and the rest will get the message.
- zigardne, on 11/12/2008, -0/+4they also gave us weekends and insurance
- DukeRevo, on 11/12/2008, -0/+4German automakers have to deal with unions too, and they're not going anyplace.
- citizen782, on 11/12/2008, -0/+4Their inventory methods are wrong. Instead of stocking a bunch of cars on a big lot that may never sell they need to go to a kiosk type purchasing method. Samples on the lot, custom order your car to specs. We don't need a different body style of the same model released earlier and earlier each year. These changes in the sales and manufacturing processes would allow time for retooling and managerial changes.
- Goodsorse, on 11/12/2008, -0/+3makes impulse buying more difficult though, which i presume would be a big deal
- Bloodwine, on 11/12/2008, -0/+4Someone commenting in another article brought up a good point. it's not just the automotive manufacturers themselves, but there is a huge industry of parts manufacturers that feed the automotive industry. All those jobs are tied to Detroit as well, and those companies might be running themselves just fine, except having their entire existence dependant on an external entity.
- zigardne, on 11/12/2008, -0/+2i dont know if its true but I heard that something like 1 in 6 jobs in the US can be tied to automotive manufacturing in some way, seems way too high but i did hear it.
- scoottie, on 11/12/2008, -4/+5FTA:
"Toyota's stock nosedived 17 percent last week -- its greatest decline in 18 years -- after the company announced it will see an operating profit of just $6.9 billion, "
it might be a 70% decline but they are still turning a profit unlike the big 3 due to union contracts- zigardne, on 11/12/2008, -0/+4the only thing that matters in stocks is projected earnings
- Barackalypse, on 11/13/2008, -1/+2Dividends also matter. I'd rather get 12% yearly cash dividends than see 12% stock price appreciation.
- zigardne, on 11/12/2008, -0/+4the only thing that matters in stocks is projected earnings
- fakesinatra, on 11/12/2008, -1/+4uhhhhhhhh no. Toyota turned a Profit.
The U.S. automakers are losing 1B/Month. THAT is "trouble."
I'm almost willing to say let the US automakers die and let a new company rise up out of the ashes. We need clean, efficient, affordable cars in the next 10 years. Stuff like SUVs and pickup trucks should be specialty vehicles manufactured by companies like caterpillar and John Deere for professional use.- Bloodwine, on 11/12/2008, -1/+3Or, at the very least, letting them fail will allow all the various brands to spin off into separate companies (some would survive, others not)
Let GM fall and watch Chevy, Saturn, GMC, Pontiac, etc. compete as separate and distinct brands. Make them shape up.- sleazycheese, on 11/13/2008, -0/+0Competition breeds champions.
- katorga, on 11/12/2008, -1/+0Shoot yeah! I'd love to have a real 4x4 again. Today's suburbanized SUV's and pickups are terrible for real work in harsh terrain. I want the original, live-axle Bronco's and Scouts back. I want Nissan Patrols and Toyota Landcruiser pickups, in diesel, here, today.
- sleazycheese, on 11/13/2008, -0/+0That's actually a great idea.
I'd hate to tell people what kind of car they can or cannot drive, but I'd also like to see fewer trucks and SUVs available to the average consumer.
- Bloodwine, on 11/12/2008, -1/+3Or, at the very least, letting them fail will allow all the various brands to spin off into separate companies (some would survive, others not)
- DrVic, on 11/12/2008, -1/+3If Detroit is tanking, who is healing?
- Bloodwine, on 11/12/2008, -0/+2The Fed is trying to heal, but he's in the corner OOM begging for an innervate.
- katorga, on 11/12/2008, -2/+2Toyota gets to manage this as just another business cycle downturn. GM and Ford are facing existential questions due to systemic problems that the downturn magnifies. The bailout of GM will only make things worse as consumers return the 1970's thinking of "american car = junk". Once they get hit with carbon taxes in 2010, a nationalized GM will collapse as their cost of production and raw materials far out-paces what any consumer will reasonably pay.
The government will move to protect its car company and erect import barriers for Toyota and Honda...eck - ncc74656m, on 11/12/2008, -2/+5Well, my '06 Corolla sucks, so, that's no surprise. The transmission is very weak (standard), is hard to shift, and the engine won't take more than ~200 HP without serious modification.
They haven't put out a decent sports car since the Corolla/Matrix XRS, and those weren't even marketed at all. The last good one that they weren't afraid to show off was the older Celicas. So... Who's surprised? Toyota gets what it deserves for years of ***** marketing and descending quality.- kingmanic, on 11/12/2008, -0/+2Toyota is hurting, but it's GM: 43% sales drop vs Toyota: 23%. Toyota is still making 6.9 billion dollars while GM is losing 2.9 billion. Toyota is suffering but not to the same extent.
- popfrogs, on 11/12/2008, -0/+1You do realize that the Corolla is the second cheapest econobox Toyota builds right? Maybe you're wanting a 1992-1995 Civic with a B16 or B18 transplant.
- huszar02, on 11/12/2008, -3/+3Detroit sucks because of both the leadership of the companies AND the unions.
The leadership allowed crap designs to pass because they were making money at the time and didn't anticipate competition in the form of superior Japanese automobiles. They were too greedy to see they were endangering the future of the company.
The unions have the clout to demand better designs, better cars, and better processes to ensure the continued financial security of the union members. But hey, the workers were totally happy building crappy domestics that broke apart after a set time as long as they still got their paycheck. They were too lazy to see they were endangering their futures.
The thing that kills me is that I know many of the autoworkers are second and third generation. They KNOW cars. They grew up seeing some of the 50-70s era cars that really evoke the once great virility of the American automotive industry. But one day, I'm watching a documentary about GM designing future cars - and who is in the room designing cars? Art students. Not car guys. This is why Detroit will fail.- vision777, on 11/12/2008, -0/+2It isn't the job of a union to decide what vehicles will be created that is the job of the design staff and management. You are probably right about the art students some of them are too concerned with looks and not the real reason people want cars.
- popfrogs, on 11/12/2008, -0/+2"Car guys" designing models just rehash what the 60's and 70's greats made. Take the Dodge Challenger and "new" Camaro for example.
Most American manufacturers (maybe minus Cadillac) wouldn't know brand identity and design DNA if it hit them with a shovel. Look at Infiniti,all the models look "related", and you know them at a glance. Same goes with BMW, Audi, VW, Acura, etc. These companies know what car design is. They know how to make a product line distinct and recognizable. They know how to share design elements among models to create a true "family" of vehicles with their brands.
Ergonomics is another factor where American manufacturers tend to fail. Poorly lit and laid out buttons, wonky seating and positioning, and dashes that intrude 3 feet into the passenger space are all symptoms of poor ergonomic design. In extreme cases, this can lead to injury in accidents.
American automotive manufacturers need to take a long, hard look at themselves. They need to take a closer look at Toyota and other successful import brands as well. Once Cadillac finally swallowed their pride and built the revised CTS, DTS, CTS-V and Escalade, they found success. But only by first throwing out their crusty 60's era books of design and half-assed styling.
I honestly believe that if US automakers follow Cadillac's formula they will find success. As many others have said, the quality gap between US vehicles and imports is narrowing. But the design is years behind. - Rioracer916, on 11/13/2008, -0/+2No no your all wrong! It's all the unions fault!!!
I mean the unions developed the Hummer in spite of trends that a vehicle that gets 5 miles to the gallon would be unaffordable at $2/gal+.
Let's be honest, management has been drunk at the wheel for years, and the labor unions are a lead weight around their necks.
Oops! They just hit a tree.
- vision777, on 11/12/2008, -0/+2It isn't the job of a union to decide what vehicles will be created that is the job of the design staff and management. You are probably right about the art students some of them are too concerned with looks and not the real reason people want cars.
- bigtoes, on 11/12/2008, -1/+5Not shocking at all . Toyota's are over priced .
- ncc74656m, on 11/12/2008, -0/+3Are overpriced now, not before. Now during the fiscal crisis, they are way too expensive.
- balthisar, on 11/12/2008, -2/+0Operating profit isn't the same as profit.
- faithforever, on 11/12/2008, -1/+8The problem isn't that the big 3 make "*****" cars. The problem is the perception that they make "*****" cars. And that's what Detroit failed to change. There are plenty of good cars coming out of Detroit with high safety ratings. Even fuel efficient cars. Overall, the quality has improved. The problem is, the majority of people don't know that.
The Big 3 have made more small fuel efficient cars, but they didn't sell because those who purchase those type of cars already are against US manufacturers. They wouldn't buy a Ford or Chevy to save their lives, and believe purchasing a more expensive Honda or Toyota is better because it will have higher resale value and less repair costs. So, Detroit goes back to building SUVs for the people who still buy their vehicles.
I'm not saying the Big Three have been perfect. The stigma that they make "*****" cars was caused by their stupidity of not fixing problems fast enough. For example, the 90s/early 2000s Jeep Cherokee had so many mechanical problems because it was built in 3 floor plant that hadn't changed since the 1940s. The plant was completely outdated and producing a flawed product. But did the plant close? No, the city of Toledo gave Jeep tax breaks to keep the plant running to avoid losing jobs and unions went crazy about moving the plant to Oklahoma. A new plant was built eventually, but all those folks that bought Jeeps that were lemons won't touch another Jeep. It's already tainted their perception that all American cars are garbage. (Geesh, why didn't anyone in Detroit see that coming???)
The UAW and Unions is also to blame for the collapse of Detroit. The contracts are extremely bloated and keeps the prices of the Big Three's cars incredibly high, and also keeps in business suppliers who constantly building parts that are inferior. The unions have kept the Big Three from changing. Alternative fuels and engines have been nixed by the Big Three if they couldn't be produced by existing suppliers.
But the biggest thing going against the Big Three is a general negativity from the public that their cars suck. And they all don't. People are shocked when I tell them that my old Ford Taurus had 300,000+ miles on it when I traded it in on a new Ford. The Big Three have failed to create any sort of effective marketing against that public perception.
Although, that points to another problem the Big Three have - Midwesterns who love the Big Three keep a car for 10 years. Honda, and Toyota have been very successful at getting consumers to lease cars and buy a new one every 2 years.
I really hope that there isn't a bail out so that the Big Three and the UAW make the changes they need. There are huge fundamental flaws.
But I would also like to ask everyone on here saying the Big Three make "*****" cars to please re-examine what they're saying. A friend of mine bought a Toyota Rav4 last year that was a piece of crap that Toyota had to buy back and refund his money. All manufacturers can make "*****" cars.- arkaycee, on 11/12/2008, -0/+3Great point @faithforever ... I mean it's just a gigantic, expensive version of "I once went into a {restaurantname} 10 years ago and the waitstaff were dicks, so I won't ever go there again." The "quality gap" exists, ON THE AVERAGE, between, say the Big Three and Toyota-Honda-etal. but a) it's narrowing, and b) there are certainly standouts on the first part and crap in the second part.
I'd have trouble buying anything with a Chrysler nameplate on it, and it was from one car purchased in 1986, from a dealer a few hundred miles away. The car had serious failings after 50K miles, and the dealer was so slimy it made other car dealers look good. They could turn it all around and make something incredible, and have a local dealer win awards for honesty, integrity, and competence, and I'd still be hard put to even bother test driving it.
- arkaycee, on 11/12/2008, -0/+3Great point @faithforever ... I mean it's just a gigantic, expensive version of "I once went into a {restaurantname} 10 years ago and the waitstaff were dicks, so I won't ever go there again." The "quality gap" exists, ON THE AVERAGE, between, say the Big Three and Toyota-Honda-etal. but a) it's narrowing, and b) there are certainly standouts on the first part and crap in the second part.
- kingmanic, on 11/12/2008, -0/+6Japan vs US leadership:
I think a big part of this is management style. Quality wise US cars have greatly closed the gap in regards to Japanese cars. While there is still an objective gap it's much smaller then it's perceived to be. But Japans management style is much different.
In this recession Japanese manufacturers will try as hard as they can to keep the staff they have while US management will slash jobs to appease short term stock holders.
A Japanese CEO/Exec makes a comparably lower salary then a US exec and feels this is better for the company.
It seems Japanese companies are less combative with it's work force. It's not US vs Them like the US. It's US as in the whole company and they try to foster this through more then speeches and empty corporate slogans. They legitimately want to keep their workforce and feel more loyalty to their own. This translate into more co-operative unions, better ability to spring back when the economy picks up and much less back biting between workers and executives.- chooter, on 11/12/2008, -1/+2good stuff.
- scamper22, on 11/12/2008, -2/+2let me summarize.
The Japanese make cars and sell them.
The Americans sell things which happen to be cars.
That's pretty much the difference. - vision777, on 11/12/2008, -0/+1American companies have the overall goal of maximizing profit for their stockholders. For most companies the single biggest expense is payroll therefore this leads to the problems you mentioned.
- scamper22, on 11/12/2008, -1/+3every company should have the goal of maximizing profit. That is not the issue.
Seems like Toyota is doing a pretty good job of maximizing profit. While the american company is tanking. Seems like Toyota is looking out for its shareholders better than the American company?
When you work in the corporate world, it will never cease to amaze you how bad business people are at maximizing profit. Part of the problem is they know nothing about the business itself. - Rioracer916, on 11/13/2008, -0/+4American companies have the overall goal of maximizing SHORT TERM profit for their stockholders at the risk of the long term future of the company and its employees..
Fixed.
American companies need to start looking at the big picture again. Toyota isn't on the cutting edge of fuel efficient hybrid vehicles by accident.
Toyota didn't accidentally generate a HUGE demand for the Prius. Any moron could have seen that since 2003 SUVs were on their way out due to the fear of increasing gas prices.
Let's not prop up companies that can't forecast and position themselves to be competitive.
Also my 2003 Ford Ranger is a POS and my mother almost cried when I said I was buying it (she was a Pinto owner). I refuse to by American again.
- scamper22, on 11/12/2008, -1/+3every company should have the goal of maximizing profit. That is not the issue.
- Treoinmypocket, on 11/12/2008, -6/+5The single largest problem the Big Three have - though not he only one - is the Unions.
The Japanese union is very different. It isn't an industry union it is a company union. Japanese unions also have management participation by design. Management has representation in the union and That means when the company is in trouble their isn't an adversarial and territorial reaction like at the Big Three.
The unions have been so busy protecting themselves they have made it extremely difficult for their employers to adapt. There is a huge investment in legacy equipment as well.
Is this all the union's fault? Not by a long stretch but, they are an impediment to solving the problem.
Now, enter the Democrats....they are supporting the existing model because unions vote Democrat, plain and simple. The right thing for the economy is to let the Big three go into bankruptcy, restructure, shed equipment, loans and people then emerge leaner.
The Democrats are literally ensuring that this won't happen by throwing OUR money at the problem. What will change? How will the Big Three improve?
They won't. Our money will be wasted, nothing will change, the Big Three will still have an impossible to support business model.
Tough choices aren't being made. They need to be.
FDRs response to what started in 1929 was to "protect people" and literally give them jobs. The result was an extended Depression (with unemployment jumping from 3% in 1929 to 25% and not coming back below 10% until 1941) instead of a short and painful one. It was only the War that ended the Depression.
Well here we are at another financial crisis and the Democrats are doing the same thing in modern form. Unless we shout them down and stop them we are headed for a much worse place then we need to be for a much longer time then we need to be.
Let these companies fail. Unemployment will go to 10% or so - it'll be hard - but what comes out of it will be a strong employment base that can grow more robustly than before - and it will happen much quicker than weakening the free market structure could ever do.- lillylibertine, on 11/12/2008, -0/+0Yup, Bernie Marcus said it a LOOONG time ago about car manufacturers and unions:
http://www.entertonement.com/clips/28681/Bernie-Ma ... - DukeRevo, on 11/12/2008, -0/+0In many ways I agree. Bailouts should only be implemented if there's hope for the company/industry to recover and come back strong, ideally paying back their loan as Chrysler did for their 1979 loan (paid back with interest ahead of schecule). Detroit has been hemorrhaging for decades. Union costs, executive overcompensation, lobbying, quality gap (or perception of such), and, until recently, being behind in technology all contributed. That, and the reliance on SUVs and big vehicles that pulled in a higher profit margin that small cars as the price of gas skyrocketed, all served to make the Big 3 completely uncompetitive, likely to the point of no return.
This is a good article that fleshes out what you've touched on here:
http://www.fool.com/investing/dividends-income/200 ...
One point of contention: when you have a union job making $95 per hour (accounting for wage, health care, pension, etc.), you are economically more likely to vote Republican. That was an interesting topic I researched in college. Unfortunately, I don't have the material on hand and my Google-fu is lacking. - vision777, on 11/12/2008, -0/+1The republicans started this whole bailout idea with their buddies in the financial industry. Now everyone has their hand out including the governor from California who I think is also a republican. The auto industry effects so many jobs in this country that if they fail this could be the downfall of our economy for over a decade.
- scamper22, on 11/12/2008, -0/+1Having read up on the history of unions, I am always at a bit of a loss at the lack of company unions in North America. Company unions were actually made illegal in the United States.
To me the company union is the right model to follow. Your interests are aligned with the company. Makes sense no? I mean, even in your dealings at work, most of your issues are with the company. Wouldn't it make sense to address safety and other issues to the company union?
Now of course mentality is everything. I imagine if we had company unions in the USA, it would very quickly get corrupted. - sleazycheese, on 11/13/2008, -0/+0I can't believe you got buried, presumably because you rightfully called out the Democrats' role in this. Why did nobody mention that it's Pelosi who's pushing this and Bush who's opposing this?
Ohh, watch me get dugg down.
I called out Bush when he did this for Wall Street, and I'll call out any politician or party that supports more of this nonsense. It'd be nice if more of you could do the same. Who knows, maybe our representatives will start listening to us instead of viewing us as useful idiots/partisan lapdogs.
- lillylibertine, on 11/12/2008, -0/+0Yup, Bernie Marcus said it a LOOONG time ago about car manufacturers and unions:
- diatonic1, on 11/12/2008, -1/+2Toyota isn't in trouble. They don't have the debt that the big 3 have... and they're not losing money like the big 3. A stock price drop does not put Toyota in trouble.
- vision777, on 11/12/2008, -0/+1Toyota can also sell cars in Japan but their economy is not as open as we have made ours so we have a tougher time selling them cars.
- TheMidnight, on 11/12/2008, -0/+1Haha there was a Mercedes ad on that page.
- lillylibertine, on 11/12/2008, -1/+1Bernie Marcus, I guess American unions weren't the problem after all:
http://www.entertonement.com/clips/28681/Bernie-Ma ... - samimnot, on 11/12/2008, -2/+4Toyota announced earlier this year that it would flip its new plant in Mississippi from building Highlander SUVs to Prius hybrids. And it's speeding up the roll out of new hybrids, with plans to launch four new models next year.
Detroit...are you listening?- Target91, on 11/13/2008, -0/+1Yes, Detroit is already in the process of doing that. Problem is that switching factories over (especially really old factories like Ford's Rogue Assembly, which also tends to explode.) takes a really long time and costs lots of money.
- vagarach, on 11/12/2008, -1/+4I don't know if there can be any hope for companies that make cars like the Sebring and Avenger. Car companies make cars, and they (the big 3) just can't seem to get normal sedans made properly.
Also: They need to STOP THE MULTIPLE BRANDS. Make Chryslers, and make GMs. That's it. Toyota has 3 brands, but they are all very distinct!
Oh and Ford should bring over all their european market cars.- darkciti2, on 11/12/2008, -0/+5I think you just hit the nail on the head with the European car market statement.
If Ford and GM brought some fresh / more efficient cars in to the US people would buy them.
Clear demand exists for efficient cars and they already have them. They just need to bring them to the US market.
- darkciti2, on 11/12/2008, -0/+5I think you just hit the nail on the head with the European car market statement.
- vision777, on 11/12/2008, -1/+7Without the unions the people working at these companies will only make 9-10 dollars an hour. How are you going to support a family for that amount of money. We need our citizens working and making a decent wage, there are not enough high tech jobs to support the entire country. Also not everyone is equipped to make it through college. The problem is we have outsourced many of our better paying jobs outside the country and now there are less people to buy the high ticket items. Also not as many people who can afford to buy houses hence our mortgage crisis.
If everyone wants zero say in how much companies pay you then I guess a union is not for you. In most cases though companies are going to pay you as little as possible. The people at the top tend to feel their job is worth many times more than the people at the bottom and unions allow people to organize so they can ban together and get treated fairly. Yes in some cases in the auto industry the unions may have gotten too much but I have seen in some cases they have been willing to take pay cuts and at the same time you see the executives still giving themselves raises.- Rioracer916, on 11/13/2008, -0/+3This is a generational mentality.
People who have never had to fight to makes sure that the 40+ hours a week they work is enough to pay rent every month, can't grasp why unions ever rose up in the first place.
Despite assassinations and all sorts of other horrible crimes committed by companies to keep workers from organizing.
Admittedly some unions have become very inflexible and detrimental. Until the labor relations dynamic changes in the US, they will be necessary.
You can't compare the US and Japan. There is a sense of mutual fiduciary duty (loyalty) between one's employer and one's employee that we DON'T have here. - Barackalypse, on 11/13/2008, -0/+1You're wrong, in Canada "Full-time union workers' average wage is $24.15. Full-time non-union workers average only $20.55." Where you randomly decided non-union people would get $10 an hour, I have no idea.
http://www.newswire.ca/en/releases/archive/Septemb ... - sleazycheese, on 11/13/2008, -0/+0I agree, a decent wage is great for employees. It just sucks for all the consumers that have to absorb that expense. The added expense means the companies aren't as competitive resulting in lower sales. Lower sales means the company has to lay people off. Of course, once that starts happening, former employees are no longer worried about how fair their hourly wage is, but whether they can find a wage at all. And, to add insult to injury, American taxpayers may be forced to bail out this failed business model (again) so that it can happen all over again.
You're heart's in the right place, though.
- Rioracer916, on 11/13/2008, -0/+3This is a generational mentality.
- Praelior, on 11/12/2008, -3/+6Ok guys, I'm sick of threads like this. In response to the 4 most repeated untrue comments on digg:
1. "American cars are garbage and are way behind the Japanese".
Wrong:
This is just the same rhetoric that gets repeated over and over and over again. Its NOT true. American cars are doing just as well as their foreign counterparts. All cars, German, Japanese, American are engineered very well using the same processes. Every adopted Toyota's methods long ago. Look at JD Powers rankings for 2008. Heres a snapshot:
http://www.autoblog.com/2008/06/04/j-dd-power-rele ...
Problems per 100 vehicles in first 90 days of ownership
Toyota: 104
Mercedes: 104
Honda: 110
Ford: 112
Chevy: 113
Hyundai: 114
Industry Average: 118
Volkswagon: 128
Chrysler: 142
Mitsubishi: 149
Aside form Chrysler (sorry), Ford and GM are up there with the rest of them. This isn't "WAY BEHIND IN QUALITY" like some people keep saying.
2. American Cars get bad mileage!
Wrong, Chevy's fleet average is better than Toyota's
http://www.automotivetraveler.com/index.php?option ...
3. American companies outsourced all the jobs. Its just as good to buy a Toyota
WRONG
http://www.cargroup.org/documents/FinalBreakfastBr ...
In 2006, the Big 3 employed 295,000 people in the US directly. International automakers employed 108,000, and this was with a market share of rougly 50% Big 3, 50% everyone else. When you factor in suppliers:
"For every job created by the internationals in the US, the Big 3 have shed 6.1 jobs in the US" (page 8)
4. Let them die!
http://www.cargroup.org/documents/FINALDetroitThre ...
With the Big 3 contracting 50%, the US would lose 2.5 million jobs, and cost the US $275 Billion
Now please, PLEASE, think before you post in the future. I think I will be reposting this whenever an Auto thread comes up, because of some people on digg who choose to make unfounded claims and continue to regurgitate the same old rhetoric. -
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