Does America Even Need Its Own Automakers?

lilengineerboy · February 2009

Excellent small cars can be built in America, if management chooses to do so.

Just not by the D3. As long as they carry $1500 to $3000 in legacy costs on each car they will not be able to build them with UAW labor. You cannot add $3000 to an Aveo and sell it. An Escalade maybe. Even a Silverado. Not a small car that will compete with Fit and Yaris.

Ford Fiesta

nippononly · February 2009

Ford Fiesta

Which won't be built in the U.S......

bpizzuti · February 2009

It's gonna be just as American as a lot of cars from "American" companies.

Only it sounds as if Ford may have another Honda/Toyota-killer on their hands.

Mr_Shiftright · February 2009

well that's where leadership and management comes in. The legacy costs are just part of the challenge of doing it.

Remember I said PROFITABLE small cars--I didn't say "cheap" small cars.

Look thee to the MINI.

gagrice · February 2009

The Ford Fiesta is built all over the World. Just not in the USA by UAW workers. It would not be profitable. Same with any other small vehicle inexpensive vehicle. The Mini is a wonderful small car. I wonder if it could be built in the USA at a profit?

Mr_Shiftright · February 2009

Given the prices they get for MINIs (have you seen the resale values?!!), I can't imagine that an American MINI (presuming it was just as good) couldn't make a profit.

Of course, this is just a niche vehicle---not enough volume to save their butts.

gagrice · February 2009

I don't think that the D3 have the foresight to build a Mini. Think PT Cruiser, SSR and HHR. If that is the best they can do for retro, they have not convinced me. It would be nice for one Domestic to survive. I voted for Ford and bought their stock. A bit like playing the lottery.

Mr_Shiftright · February 2009

I looked at the HHR before I bought my last new car. Test drove it. Not bad but it was no MINI you're right. Again....adequate but nothing special.

gagrice · February 2009

I got an HHR when I went to see my new grandson in Alaska. I was not impressed at all. Made lots of strange noises driving down the highway. Had difficulty on ice. Probably some kind of worthless traction control device. I like to control my own vehicle on Ice. I have spent as much time driving on ice in the last 40 years as dry pavement. ABS is horrible on ice. All doodads for non drivers.

boaz47 · March 2009

The UAW could build the Mini. Heck the Koreans could build it. It was rated less dependable than Chrysler and Subaru and just above chevy and Hummer in dependability by JD Powers last year. It seems as if BMW didn't put as much effort in it as they did the main brand.

But a niche vehicle doesn't have to sell well only sell what they made. Toyota's Scion wasn't very bullet proof for a Japanese car by coming in under Hummer in dependability. Something is happening to the companies we used to trust and they don't have the UAW to blame. Thank goodness VW, KIA and Suzuki are still on the bottom. I was beginning to worry they migh move up on the list after all these years. Do they have the UAW?

But I will agree the burden of the UAW is a hard one for the domestics to get by. Still if we assume we don't need the domestics anymore doesn't it follow we should get rid of anyone doing worse than they in dependability? :P

You know when it is all said and done it doesn't make a big difference one way or the other. Korea wouldn't let Kia die and all but forced Hyundai to buy them out. Something about not allowing a monopoly of only having one company in the country. Nissan should have folded but was saved by Renault. Subaru almost fell apart in the late 70s. Japan didn't need either of those companies. The key word was need. Hyundai isn't putting a full faith effort in improving Kia or Kia would be built as well as Hyundai. we simply have too many manufacturers in the world as it is and sooner or later, maybe quite a bit later there are only going to be five or six companies in the world. The US may or may not be part of that but that is just how things are. However I believe the new administration will come to the domestics aid and we all will be share holders in a government car company. Like it or not. :sick:

lilengineerboy · March 2009

I looked at the HHR before I bought my last new car. Test drove it. Not bad but it was no MINI you're right. Again....adequate but nothing special.

We got an HHR a couple of trips to CA ago. It took 2.5 people worth of cargo plus a dog in a crate. I got in the car in the middle of the night (we had the 9pm Spirit flight from DTW to LAX) and had no trouble figuring out where everything was, turned the key and made the 2hr drive up the coast.
I was surprised at the visibility, the windows seemed small but I felt like I could see very well, it might be a combination of the higher seating position and the huge mirrors. Oh, and it had a good turning circle (important when I got lost coming out of the BK driver through at 1 am). The biggest complaint I had about it was that it was filthy, and had it been daylight I never would've accepted a car that had that many stains inside.
I also didn't find it very sporty, but compared to a PT Cruiser it felt better constructed, it felt more responsive then a Vibe (especially the automatic), and the Focus wagon is gone.

gagrice · March 2009

GM Daewoo sell several cars here that are built in Korea. The Aveo, Wave & Saturn Sky. If GM, Ford and Chrysler are to be part of the World Automotive they will need to become US imports until the UAW dies of starvation or is shut down by the bankruptcy courts. On the slim chance the UAW membership decide that survival is more important than honor, they will shed the legacy costs, restrictive work rules and high wages. Throw out about 2100 pages of that 2200 page contract they use to keep the D3 from competing in the World automotive arena.

joem5 · March 2009

There are so many complaints on Edmunds about the quality of the MIni and all it's problems especially with its tranmissions,yet Edmunds sings it's praises and won't allow talk of a class action suit.BMW may own Mini,but the British build them. You ever own a MG. It took Mazda to get it right with the Miata,enough said.
The Ford Fiesta if it's the one that's being driven in Europe I'd have to see it in action in this country . I question any American cars realiability. I'm of the lost generation to Japanese cars.I donot blame the wokers on the line,but the white collar workers who only care about the bottom line and not the "build"
Most American cars are planned obsolesence compared to the Japanese.
Spyder keep up the good work.

dave8697 · March 2009

if the union accepted changes that made GM profitable in a healthy economy, is that enough?
For a significant number of people who feel betrayed by the D3 in some previous purchase, probably not.
They don't care but some of us feel betrayed by the massive reliance on imported products due to what it has partly contributed to the fall of America.
We all get to pick our poison by voting with our dollars to some degree. We also don't get to pick our poison because our gov't votes with some of our dollars for us, even if they have to print those dollars from paper. So do we turn against our gov'ts's attempt to retain D3 and offshoot employment and keep voting against our country with our dollars?
If my next new car is a GM, it will be my 7th new one.

Mr_Shiftright · March 2009

The MINI has been kicking butt in the market for 5-6 years now. The Big Three should be so lucky to build such an awful car as the MINI.

This reminds me of what Lincoln said about Grant when they complained that Grant was a drunk. He said something like "Send my other generals whatever he's drinking"

If a car has personality, good looks and is exciting to drive, it doesn't have to be the best car in the world. If that were necessary, Ferrari wouldn't have pre-sold every car it has made for the past 10 years or so.

MINI is really fun to drive, and it's built like a little bank vault. It's fast, cute and has an amazing resale value.

I'd buy one in a heartbeat if I had the extra cash.

Scion? The Big Three should be so lucky as to have built such an awful car as the Scion xB.

boaz47 · March 2009

I have to ask, is that the best selling, sub compact, retro niche car, made assembled by the brits and owned by the Germans market? Then you are right. But I wonder just how important fun to drive car is to the majority of the market? How does that square with the best selling Toyota or even Honda?

So you are saying it isn't quality? Then what matters? It shows BMW and Toyota "can" build quality but for some reason they decided to cut back on Scion? After all the survey was taken from Owners and simply put on paper. If we all agree the Hummer is a law quality vehicle then we have to conclude the same for any vehicle the owners rate as poorly shouldn't they?

So it all comes down to huffing and puffing. Some of us have a personal preference and will stand by it even if everyone else disagrees. There are those in these forums that swore the Subaru Baja was a good idea. They just knew the Echo would sell to the youth market. Didn't happen but they stuck with it till the very end.

Now we hear that people will not switch from Japanese cars because they were betrayed by the domestics? And out of the same side of their face they hope for the return of the French and the Italians? Huffing and Puffing IMO.

The question was do we need our own automakers? As a country we have to answer that question. gagrice has a valid point that could modify the question to do we need the costs of the UAW? But we need our own industries far more now than we need to support someone elses industries. As it was said during the election it is the economy. In this economy we may need to get rid of some of the costs of the UAW. But we need to support our economy far more than we should support Japan"s or Germany' s.

stever · March 2009

,yet Edmunds sings it's praises and won't allow talk of a class action suit

And yet you just did. If you are touting a law firm, then yeah, an ad post will get booted.

China has decided it doesn't need so many automakers. 10 major ones will do, instead of the current 14 major ones and 100+ minor ones.

China's Auto Bailout Takes a Different Route (Time)

Mr_Shiftright · March 2009

I never met one single person that was dissatisfied with their Scion, including me :P

But let's say for argument's sake that the Scion was no better than say...a Pontiac.

Yes, I would say quality is not in direct proportion to success, all by itself.

The Big Three need to do more than just build better cars...they need to build more *appealing" cars.

Say what you will about the Scion xB, people loved them then and love them now.

If somehow you could plot a graph on the relative relationship between people loving their cars and reliability, I don't think the relationship would be all that strong.

A car is, after all, not only transportation but a projection of dreams, desires, status, aspirations, aesthetics, etc.

In other words, the Big Three could top the charts in reliability and still fail....yes.

boaz47 · March 2009

A car is, after all, not only transportation but a projection of dreams, desires, status, aspirations, aesthetics, etc.

A car has no soul. It will run just as well or just as bad for someone that steals it as it did for the owner. It doesn't care how much you love it when it breaks down. It is a tool and nothing more. It will fail on you no matter how much you plead at the worst possible minute and so dependability has to count for more than something. As far as loving the xB people loved the Baja and they hardly even put them up for resale. Still a dead duck. If a car represented hopes and dreams to more than a hand full of people cars dealers would be hurting. As is demonstrated by the decline in car sales during this bad economy. If they had to be exciting then Camry and Accord Sedans wouldn't out sell coups. The Italians made some very sporty cars as did the French and they were driven from these shores.

I will conceed they can be attractive and even a work of art. The xB is not however.

Mr_Shiftright · March 2009

Yes but if you were right nobody would spend money on advertising to seduce us. They would just say. "Here's a picture of it. Buy it".

Can you even point to a modern automobile ad that does not portray a dream, aspiration or aura of status and/or personal identity?

People's idea of beauty covers a wide range. Ever been to a dog show? :P

lilengineerboy · March 2009

I never met one single person that was dissatisfied with their Scion, including me

Sure, once you modified it. :P My sister bought the Mazda3 of the Corolla because she said the Toyota felt "tippy." As a bonus (in addition to the sway bars), she got rear disc brakes and a decent tire. Sounds like about what you had to do to get your Scion to be "satisfactory."

lilengineerboy · March 2009

A car has no soul. It will run just as well or just as bad for someone that steals it as it did for the owner. It doesn't care how much you love it when it breaks down. It is a tool and nothing more. It will fail on you no matter how much you plead at the worst possible minute and so dependability has to count for more than something.

If people really felt that way, everything would come down to cost, and the '05 Taurus would still be the top selling car in the US.

lilengineerboy · March 2009

People's idea of beauty covers a wide range. Ever been to a dog show?

I was reminded of that every time I used to go to Scorekeepers in Ann Arbor. :P

Mr_Shiftright · March 2009

Yeah but it was still very reliable, and still is, with the new owner. 50,000 miles and zero problems, nada, zilch, not even a burned out light bulb.

Here's an ad for a 2006 Scion xA. The asking price is exactly what I paid new for it!

$13,100.

http://sfbay.craigslist.org/eby/ctd/1054819475.html

Here's a 2006 MINI (not an S)

Asking price is $19495. I priced out a 2006 MINI in 2006 for $20, 480 (I still have the print out, so that's how I know).

http://sfbay.craigslist.org/nby/ctd/1055023974.html

Pretty amazing, even if you cut 10% off these prices.

Think you're gonna get these prices for a 2006 PT Cruiser? Don't think so.

It's $8499, low miles from a dealer.

http://sfbay.craigslist.org/pen/ctd/1054724214.html

Mr_Shiftright · March 2009

That reminds me of something I read on a bathroom wall once---but no, we won't go there. :shades:

boaz47 · March 2009

But it is that way, everything else is Anthropomorphism. If it weren't why would the most popular cars move towards vanilla? Enthusiasts are a rare breed that has learned to love a machine. A train is a train, a buss is a buss, a Plane is a plane and ship is a ship but somehow a car is a living things. Can the be or should they be extension of who we are? Advertising tries to tell us one kind of TV will make us a better person yet none of us will buy one to show our hopes and dreams. Mechanics have had tool posters and calenders in their shops with pretty girls holding air wrenches but no one believes they will attract girls because they have a Snap-on wrench. I didn't say strap-on either.

I am not sure falling for advertising shows strength of character. But like I said, the most popular vehicles tend to be the one that have the least personality.

Mr_Shiftright · March 2009

Popular cars don't have to be boring. The Fiats and Golfs and Peugeots overseas are fun to drive.

srs_49 · March 2009

I owned a '73 Fiat. Yeah, it was kind of junky in the long run, but a lot of fun to drive, even with only a 1.2L engine. I still got 120,000+ miles out of it. Sorry Detroit, but I just could not see myself in a Pinto, Maverick, or a Vega.

lilengineerboy · March 2009

Yeah but it was still very reliable, and still is, with the new owner. 50,000 miles and zero problems, nada, zilch, not even a burned out light bulb.

I think that is par for the course now. My dad was amazed that for the first 3 years, his G35 required nothing beyond oil changes. That was it. The Subaru got new windshield wipers under warranty, that was it. I don't think that makes it exceptional I guess.

Japanese cars being the same price new or used (or cheaper new with the Obama tax credits) is a California thing. Its why my brother and sister had Escorts in high school and college and not Civics (both of which handled drivers from 16-22 without complaint).

dtownfb · March 2009

I'Ve been complaining about the Big 3 for years. Lack of innovation, reliance on pickups and SUV, too many models and brands, killing off Oldsmobile instead of Saturn, too many rebates and incentives, losing money, etc. Read my posts over the past 5-6 years.

News Flash! We are going to lose a bunch of suppliers no matter what happens to GM or Chrysler. There are too many cars being produced for the current market. Sales were artificially raised over the past 7-8 years due to the overuse of incentives/rebates and easy credit. Times have changed and the industry has to adjust. The government providing endless bridge loans is not going to help the industry but drag out the recession. GM could not make money when sales were at 17M 4 years ago. They can't make money now. If Cerberus does not want to invest their own money into Chrysler, why should we? Let's stop playing games and get down to business. Each company has had plenty of time to deal with this issue. GM knew back in 2005 things were coming unraveled. Daimler knew in 2006 which is why they unloaded Chrysler for a song.

We're going to be paying for this for a long, long time no matter what happens. The fact that the big banks don't have a good sense of what their losses are is inexcusable. Just heard on the radio tonight that AIG lost $60B the last quarter and needs another $30B. Unbelievable! All this fancy accounting is going to drag the country down more than anything in the auto industry. We can fix GM all we want. If no one can qualify to buy a car, it won't matter.

Mr_Shiftright · March 2009

The USA is still the largest manufacturer of goods in the world, by a long shot. We just need to make other things, is all.

fezo · March 2009

Thanks for the news flash. It's exactly right. No matter who is making motor vehicles in the USA by the end of 2009 suppliers will supply the parts for roughly 10 million vehicles. Whether those vehicles are GM, Ford, Chrysler, Toyota, Honda or whoever else you'd like to mention is to a large degree irrelevant. Those suppliers who are flexible enough to do a quick change from Chrysler to, say, Hyundai are going to be the ones who survive.

lilengineerboy · March 2009

killing off Oldsmobile instead of Saturn,

I always thought Oldsmobile just died off with the customers...unlike Saturn which got killed off by management. Hmm lets invest a whole lot of money and get people to like an American car...a moderately competitive import fighter...and then lets not update it for 10 years...that isn't "a different kind of car company," thats what Chrysler did with the Horizon.

fezo · March 2009

I always thought the mistake with Oldsmobile is they completely changed the direction of the make - trying to lure would be import buyers on essentially the appearance of the car (which, to be fair, produced some attractive cars - I think the last Oldsmobiles look good right now) while leaving nothing behind for the traditional Oldsmobile owners who had bout things like 98s and 88s. The import crowd never moved over and the the traditional Olds customers moved on to something else.

Saturn, of course, was a completely different kettle of fish. They didn't know what to do with an originally pretty decent start and let it die.

boaz47 · March 2009

The USA is still the largest manufacturer of goods in the world, by a long shot. We just need to make other things, is all.

I'm not sure that is true anymore. we have shipped a lot of our labor off shore.

Labor force - by occupation: US
farming, forestry, and fishing 0.6%, manufacturing, extraction, transportation, and crafts 22.6%, managerial, professional, and technical 35.5%, sales and office 24.8%, other services 16.5%
note: figures exclude the unemployed (2007)

Labor force - by occupation: China
agriculture: 43%
industry: 25%
services: 32% (2006 est.)

Labor force - by occupation: Japan
agriculture: 4.4%
industry: 27.9%
services: 66.4% (2005)

Labor force - by occupation: Germany
agriculture: 2.4%
industry: 29.7%
services: 67.8% (2005)

Mr_Shiftright · March 2009

It's definitely true in terms of VALUE of the goods produced...I should have been more clear about that.

bpizzuti · March 2009

The import crowd never moved over and the the traditional Olds customers moved on to something else.

Saturn, of course, was a completely different kettle of fish. They didn't know what to do with an originally pretty decent start and let it die.

It's not that...GM just has always been stretched too thin. They're just starting to realize it now (nearly 10 brands??) but they're still trying to avoid doing anything about it. Since none of them are truly unique it's harder to spin any of them back off to be independent companies, so now they're stuck in a hole of their own making. Toyota sells the same approximate number of models but with only 3 brands...that's a ton less overhead, and it also means fewer dealers cannibalizing each other for sales, lowering resale value.

GM dug their own hole, now they need to go bankrupt in it. Heck, Saab has already declared bankruptcy.

bpizzuti · March 2009

It may also be true with amount of goods...Boaz was only pointing out labor statistics. Fact is, America also has the most efficient workers in the world, which means it takes only X workers to make Y products. Whereas in China it probably takes X * 2 to make Y, hence a higher percentage of population employed in manufacturing.

kdhspyder · March 2009

We're going to be paying for this for a long, long time no matter what happens. The fact that the big banks don't have a good sense of what their losses are is inexcusable. Just heard on the radio tonight that AIG lost $60B the last quarter and needs another $30B. Unbelievable! All this fancy accounting is going to drag the country down more than anything in the auto industry. We can fix GM all we want. If no one can qualify to buy a car, it won't matter.

IMO it's all that fancy ( ficticious ) accounting that got us here in the first place. What's going on now is more basic accounting in doing the books they way that they should be done. It turns out the the Emperor wasn't wearing any clothes all this time and we just didn't see it.

lemko · March 2009

Funny, all these electronic nannies in today's cars. I managed to get by on snow and ice in a 1968 Buick Special Deluxe with nothing more high-tech than studded snow tires.

lemko · March 2009

Popular cars weren't boring at one time. The 1960s Chevrolet Impalas are an excellent example of a non-boring popular car. Heck, even a plain-jane Biscayne had interesting styling.

lemko · March 2009

Funny thing is, both the new style and old style Oldsmobiles appealed to me. I thought the Aurora and Intrigue were beautiful cars though a Ninety-Eight Regency was more my style.

fezo · March 2009

My goodness - I agree with three consecutive lemko posts!

I grew up in the hills in NW Jersey and learned to drive on old, traditional RWD American cars - like a 67 Pontiac Tempest and 66 Biscayne (both nice looking cars BTW). We lived on the middle part of an s curve heading downhill and I was fine. Never had a mishap. The only people who ever did have a problem on that hill were cases of opps rather than weather - like the mailman who forgot to set his brake and ended up with a Jeep in the woods.

I liked both the new and old Oldsmobiles as well. I still think if they'd given them a bit more time and kept at the concept they were developing teh new ones would have worked. Yes, GM has too many brands but sometimes I think they cut the wrong one there and aren't sure now which is why they are hedging their bets - on our nickle of course...

nippononly · March 2009

Didn't Buick make Oldsmobile 100% redundant at the time? I am sure they just flipped a coin and Oldsmobile called 'tails'. Would htey have been better off planning in the late 90s to kill off Buick and keep Olds? Buick sure isn't setting the world on fire, would Oldsmobile have done so?

fezo · March 2009

Yeah, it was probably a coin flip and they thought Buick could make a better go of it.

Heck, I would have thought that Buick had more staying power ti it than has actually been the case.

Mr_Shiftright · March 2009

I drove an MGA with snow tires in New York City for YEARS! Some good luck, some skill, some common sense---I got by just fine. (it was cold inside though).

xrunner2 · March 2009

Wasn't it a combo of bad quality from Olds, declining sales and a lack of investement by GM to have up-to-date Olds models? Another part of the problem was the name, Oldsmobile. In new-age 90's, 2000, that name was a loser. No potential for getting youth to buy an old man's car that even told you it was old - Olds.

Buick is somewhat beter in not sounding old fashioned, but still sounds strange when uttered, kind of like a burp.

Mr_Shiftright · March 2009

Of course these cars were named after their creators, before there was even the concept of "marketing". Car ads when Mr. Buick and Mr. Olds were in their prime were very straightforward. They said things like "It'll get you there" and "easy to drive, even for women"----things like that. We are talking WW I era.

Buick and Olds were created in a different world. It's amazing they lasted as long as they did. Some say "Benz" is the oldest survivor, but actually Mercedes-Benz only dates from 1927.

Contrary to Mr. Obama, America did not "invent" the car, but we certainly invented how to make a lot of them efficiently.

An art we have apparently lost

bpizzuti · March 2009

Contrary to Mr. Obama, America did not "invent" the car, but we certainly invented how to make a lot of them efficiently.

An art we have apparently lost

Oh, we can still make them more efficiently than anyone else. We just can't sell them at a profit. :shades:

nippononly · March 2009

We make them so efficiently now that there are millions of unsold ones sitting around all the time, that have to be rebated to the hilt or gifted to the rental fleets just so we don't burst at the seams!

Does America Even Need Its Own Automakers?

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