T Nation

What Is Going On With Auto Makers?

What is going on with the once strong American Auto Makers?

GM, Ford and now Chrysler are not only operating in the red; they are laying off thousands of employees. (~110,000 at last count).

To my “Nation” friends; what happened?

Poor product?

Too much overhead?

Retirement and Pension agreements that are impossible to keep?

Some combination?

Is there going to be a remedy to their problems?

I think that we all should be concerned…

Discuss?

Mufasa

I do not feel that this is true for all U.S. auto makers. Ford is makeing a strong turn around and Mopar is holding their own. GM is the one crashing fast. They won’t be on top after this year as Toyota takes over.
There are even rumors of Toyota buying out even more of GM. They already bought Subaru last year.

My guesses are why GM is crashing

  1. Import cars are better build quality…even koren made brands.
  2. The factory workers get paid way too freaking much.
  3. They lack in the marketing arena.
  4. Z06 and Silverado are not enough pull to hold a company above water.
  5. Don’t even get me started on the EV…

Those are some factors that I see.

I’m not claiming to know a lot about the car industry, so I’ll just give my opinion as a rather uninformed consumer.

Could it be the recent dependency on foreign cars? Years ago, they gained a reputation for having good gas mileage, then for being ULTRA reliable, and most recently for being able to squeeze the most out of 4 and 6 cylinder engines.

I don’t think gas mileage is really relevant today, BECAUSE they’re all within a few MPG of each other in comparable classes. Most people make the difference between 27 and 30 MPG out to be monstrously significant, and unless you’re racking up 50,000 miles/year, it’s really not.

I’m not sure about reliability either. Do foreign cars produced after, say, 1995, or even 2000, have a much longer life expectancy than their American competitors? Popular belief would indicate that they do, but I haven’t seen (or looked for) studies that show this.

Foreign cars usually do get quite a bit more HP out of a 4cyl or 6cyl than the American cars. However, when it comes to the V8, American-made still dominates.


Basically, I would say that foreign cars are becoming drastically more popular, for mostly pointless reasons.

[quote]Joebus wrote:
I do not feel that this is true for all U.S. auto makers. Ford is makeing a strong turn around and Mopar is holding their own. GM is the one crashing fast. They won’t be on top after this year as Toyota takes over.
There are even rumors of Toyota buying out even more of GM. They already bought Subaru last year.

My guesses are why GM is crashing

  1. Import cars are better build quality…even koren made brands.
  2. The factory workers get paid way too freaking much.
  3. They lack in the marketing arena.
  4. Z06 and Silverado are not enough pull to hold a company above water.
  5. Don’t even get me started on the EV…

Those are some factors that I see.[/quote]

Wow, not a GM fan eh? GM isn’t going ANYWHERE. Even when Toyota is number 1, GM will still be the largest US auto maker.

Unions. A relec of the past that should be illegal. Those guys will go on strike for a week just to get an extra 5 minute break. That’s why many American auto makers are relocating to the south (American South) because the unions do not exist here.

Second, lack of ingenuity. Everything looks the same now. YAWN. Boring cars. Even the Corvette is boring looking.

Expense (kind os goes back to unions). Try to buy a new car for under $20,000. That’s rediculous. $400 a month for a Ford econo-box.

[quote]Joebus wrote:
Ford is makeing a strong turn around [/quote]

Do you mean in the two weeks since reporting a $12 billion loss in 2006?

EV?

Mufasa

I’m a VERY proud Union Laborer and I love my job but my stomach turns whenever I think fo the UAW. It’s unions like them that give UNIONS in general a bad name.

As far as why US automakers aren’t succeeding, just take a look at their products. I LOVES me some Cadillacs, Oldsmobiles, and Mustangs, but you just don’t get the same value dollar for dollar when comparing “American” made vehicles and “foreighn” vehicles. The reliability, styling, performance, fit, and finish of most foreign entry/midlevel vehicles is/are FAR superior to the equivalent “American” product.

I’ve owned countless vehicles and currently own a Honda…because it was a good deal and I know it just won’t die, not to mention the low maintenance costs. BUT, my dream cars will always be American Made.

[quote]Mufasa wrote:
EV?

Mufasa[/quote]

The EV-1, I think.

Thanks, Ryk!

Great discussion, guys!

Mufasa

Discussions about the “UAW” seem to open some VERY bitter wounds…

Mufasa

[quote]TheSicilian wrote:
I’ve owned countless vehicles and currently own a Honda…because it was a good deal and I know it just won’t die, not to mention the low maintenance costs. BUT, my dream cars will always be American Made.[/quote]

This is what I’m talking about right here. Do you have any statistics that indicate foreign cars STILL outlive American, or are you going off the reputation these cars made decades ago?

Again, I’d like some maintenance statistics. Not just how often the cars break down, but how much each costs to repair.

Your dream cars WON’T always be American made…if more AMERICANS start/continue thinking like you and buy foreign.

Ford Mustang Concept: http://www.rsportscars.com/eng/cars/mustang_giugiaro.asp

[quote] I LOVES me some Cadillacs, Oldsmobiles, and Mustangs, but you just don’t get the same value dollar for dollar when comparing “American” made vehicles and “foreighn” vehicles. The reliability, styling, performance, fit, and finish of most foreign entry/midlevel vehicles is/are FAR superior to the equivalent “American” product.

I’ve owned countless vehicles and currently own a Honda…because it was a good deal and I know it just won’t die, not to mention the low maintenance costs. BUT, my dream cars will always be American Made.[/quote]

Very much agreed. have you ever noticed the size difference in service areas of foreign made cars to domestics. theyre half as big.

As for the corperations theyre under… domestics face all the difference between unions, pensions, and inflated production costs. labor costs domestically are pennies on the dollar to whats made in the US. its the same “cycle” that Boeing went through a few years ago. they were in the red, got bought out by a foreign company that virtually kicked the Union out at so far has been doing much better.
FYI… GM spent more money on Viagra under pensions last year than they spent to put windshield wiper blades on every one of their vehicles made.

You left out “greed at upper management” as one of the choices. They listen too much to the morons on Wall Street, who freak out any time the stock takes a dip, even if it means a greater return in the long run. The unions defintitely don’t help matters (and yes, I am union), but whenever the health of a company is in question, you have to look at the leadership.

I think the car magazines have a big part in it too. You see magazines like motor trend and popular mechanics constantly hyping the imports.

[quote]Brett T. wrote:
TheSicilian wrote:
I’ve owned countless vehicles and currently own a Honda…because it was a good deal and I know it just won’t die, not to mention the low maintenance costs. BUT, my dream cars will always be American Made.

This is what I’m talking about right here. Do you have any statistics that indicate foreign cars STILL outlive American, or are you going off the reputation these cars made decades ago?

Again, I’d like some maintenance statistics. Not just how often the cars break down, but how much each costs to repair.

Your dream cars WON’T always be American made…if more AMERICANS start/continue thinking like you and buy foreign.

Ford Mustang Concept: http://www.rsportscars.com/eng/cars/mustang_giugiaro.asp [/quote]

I’ve owned 7 cars in my lifetime, 2 Honda’s, 2 Oldsmobiles, 1 Cadillac, and a Mustang. I loved all of them for different reasons, but I’m not going to buy a car based on if it’s AMERICAN or not, I’m going to buy based on whether I LIKE it or not. ALL of my cars have been pretty good to me, especially considering how hard I am on them. In my experience it’s cost me LESS to maintain the Honda’s.

Basically, my stats come from my own experience and that of others I know. I LOVE cars in general, but the US automakers NEED to take a page from either what made them successful BEFORE now or from foreign automakers if they want to succeed.

In the late 80’s and early 90’s foreign auto makers were making very dependable cars, and at the same time, american car manufacturers were making very poor quality cars that were simply not dependable.

In 1987 my mother bought a brand new Monte Carlo, at the same time my friend bought a brand new Toyota truck. Within a year, the intake manifold cracked on the Monte Carlo, and had to be replaced. It was all down hill from there, and a fight with the dealer as to who would pay for the repairs until the short warranty was over. Here is a list of what I replaced on that dam Monte Carlo in the course of 10 years:

carburetor
intake manifold - 2 times
starter
distributor
radiator
transmission - 3 times
water pump
timing chain
plastic fitting on the intake manifold for the heater
alternator - two of these
catalytic converter - numerous times
cat back exhaust
shocks - all 4
air conditioning worked for a year or two - never worked again
blower motor
rotors - front ones
brakes every 6 months
wheel bearings - 2 times
regular tune up and oil changes

The monte Carlo lasted a little over 200,000 miles with all of this, and I am sure I am forgetting stuff. When it had 150,000 miles on it, I could no longer get it through emissions.

My friends toyota truck? Yea, lasted nearly 300,000 miles with only regular tune ups and oil changes. Sure he replaced stuff like the battery when needed, but i consider that regular maintenance. Never had any problems with the truck until at 300,000 miles the transmission went in it.

My mother bought another monte Carlo in 2002, and that car is having the same crap problems. The steering box has always leaked, and clanks when the wheel is turned. She has taken the car back for this 3 times, and still the leak remains. Recently a problem sprung up. Get this, put the car in revers and the horn beeps the entire time the car is in reverse. Yea, body control box went bad causing this. Yea, thats a $700.00 part. My 1998 Mitsubishi has less problems than my mother’s 2002 Monte Carlo with 1/2 the mileage of my car.

In around 1999, a preson renting a room from us bought a Ford Probe. Within the first month of owning the car, it broke down 3 times. He pulled up to the house once extremely angry. The car was barely running, and coolant was streaming out of it. This was a brand new car! He did not have it long, dont recall what became of that deal.

Being a mechanic it is obvious to me why foreign car sales are doing better. American manufacturers got too caught up in short term profits and allowed their product to weaken. Now they are like “oh shit,” and are working to create a more dependable vehicle, but the damage is done and they are still not up to par with the foreign vehicles of similar cost.

I love Ford, I hate GM, and I will probably buy a foreign car in the future because of price to what you get ratio. I would love a Mustang Cobra, but the price $$$$.

[quote]Doug Adams wrote:
You left out “greed at upper management” as one of the choices. They listen too much to the morons on Wall Street, who freak out any time the stock takes a dip, even if it means a greater return in the long run. The unions defintitely don’t help matters (and yes, I am union), but whenever the health of a company is in question, you have to look at the leadership.[/quote]

I agree with you, after looking at some of the compensation/severence/retirement packages some of these so called leaders receive, it makes me want to vomit.

What trade are you if I may ask???

Car mags do play a big part because they are the ones test driving everything out there. Yes imports do win most of the time. Open up the mag and you see more US automakers advertising. So you cannot put how they review on which company pays them. I am a chevy guy at heart that is why i get so pissed about GM screwing things up. Holden is the future of that company if they know what they are doing.

[quote]jarvmaster wrote:
I think the car magazines have a big part in it too. You see magazines like motor trend and popular mechanics constantly hyping the imports.[/quote]

I never thought of this, I wonder how much people value said magazines when purchasing an automobile??? Thanks for the food for thought.

I think another reason is the Fast and the Furious movies, didn’t see to many American vehicles in those now did we??? Except for the Lightning and the Mopar at the end, I don’t really recall any…Those movies were BULLSHIT anyway, at least if you have any knowledge about cars.