Should the American automakers...

[clocker]

Personally I think this starts with losing the management that made the bad product choices, replacing them with good management, then trimming downwards through the grades. The pain should be felt across the board and not just the workers.

Of even more importance than "losing the management that made the bad product choices" would be changing the type of management they employ.

For at least the past 30 years, Detroit has been run by accountants instead of "car/manufacturing" guys.
Engineers and manufacturing specialists have been at the mercy of beancounters who routinely overrode requests for improvements because they would impact the bottom line.

A good case in point would be the electrolytic application of rust protection to unibodies.
You've probably seen pictures of car bodies being dipped in tanks of sealant to completely coat the metal...this process was invented by Ford and yet Ford was the last major manufacturer to actually deploy the technology because it cost @$5 million dollars per plant to install.
The accountants figured it was cheaper to repair warranty claims than to prevent them from the get-go.

The primary focus of the US car makers was on producing a mediocre car and then making it even more cheaply over the course of it's product life.

This same mindset was also responsible for the industry claiming that any/all increases in safety/fuel economy would lead to their downfall...such technology would cost money and was therefore "impossible".
Naturally, they lobbied themselves a sweet exemption for "light trucks" which lead to the era of the SUV. Since SUVs were classified as light trucks, they were exempt from CAFE requirements and meant you could take a pickup truck chassis, throw some leather and a sound system at it and then market it to soccer moms as being "safer".
The real reasoning of course, was that they made a shit ton of money on each sale and it didn't count against their CAFE limit. The Big Three claim they were only building what their customer wanted which of course is total bullshit...they conditioned their market to accept what they wanted to sell, not the other way around.
Ironically, as the size of the average American family has been shrinking, Detroit has been pushing them to buy ever larger cars/SUVs. This trend has also been mirrored in the housing sector...smaller families, larger houses.

Meanwhile, development of actual cars that were more efficient and safer was completely sidetracked because why spend money you didn't have to?
The profit margin on a SUV was enormous and the margin on a small car- where you're competing against all those pesky foreign builders- was tiny.

So today we're being asked to bailout these same cynical accountants because they're indispensable to the health of our country.
Functionally, these guys are no different than their Wall Street brothers...cars were only an incidental byproduct of the quest to increase the productivity of the money held by the corporation. It could have been widgets or cat food, these guys knew nothing about and couldn't care less about the product (i,e., cars).

I think it would be much more productive- and far more interesting- to bypass these creatures of commerce and start talking to the engineers and designers- you know, the guys who actually get their hands on metal- and ask them how to move forward.
Hopefully there are still a few smart guys left in an industry which has prized financial acumen over technological innovation for the last three decades.
If not, then let's import some Japanese/Korean/Indian guys to show us how it's done.

[j2k4]

The point is it is a figure that is padded up as a propaganda tool instead of an accurate take home. We don't subtract non employer supplied health insurance or pension costs from hourly wage statements.

An odd view, considering how these figures impact the quality of the begging going on in D.C. just now.

The real figures are most likely much higher.

BTW-

Would you like to get into what the idiotic "job-bank" costs them?

Paying idled workers their full wages?

[devilsadvocate]

http://www.usnews.com/blogs/flowchar...-chrysler.html

6 Myths About GM, Ford, and Chrysler

November 20, 2008 12:42 PM ET | Rick Newman | Permanent Link | Print
Memo to CEOs: Ask for a bailout, and your company will be reduced to a caricature.
Recent congressional hearings on the plight of GM, Ford, and Chrysler have illuminated a few important issues—like how the Detroit executives travel when on business. Populist politicians and gotcha journalists delighted at the prospect of rich CEOs riding corporate jets to ask for taxpayer money. There was a little talk about jobs and cars and the foundering economy, too. But you might have missed that part, or gotten confused by a welter of misperceptions that emerged from the spectacle of supplicant CEOs trying last-ditch tactics to save their companies.
As the automakers careen toward bankruptcy, here are some of the myths complicating the debate over the future of the Detroit Three:
They don't build small cars. The Detroit Three build plenty of small cars—they're just not very good. In the U.S.News rankings of affordable small cars, for instance, seven out of 34 models are domestics. But the highest ranked—the Chevrolet Cobalt—lands at No. 20, while the top three are all Hondas. So, CEO Rick Wagoner is telling the truth when he says that in 2009 GM will offer 20 models (including a few mid-sized cars, a couple small sports cars, and a few others) that will get 30 mpg on the highway. The question is whether anybody will want to buy them—and if not, is it the government's job to subsidize uncompetitive products.
They don't build any desirable cars. A few recent Detroit models have been hits, like the Ford Fusion, Chevrolet Malibu, Cadillac CTS, and Saturn Outlook. And even Consumer Reports, which has mercilessly trashed Detroit's shoddier vehicles, recently issued a statement saying, "We've seen some progress among the domestic automakers lately, with improved reliability and performance in certain models."
The problem is that the domestics are strong in a few segments, while weak—or nonexistent—in many others. So when soaring gas prices and a stumbling economy torpedoed their flagship vehicles—trucks and SUVs—there wasn't much else to balance out the portfolio. Neither GM nor Ford offers a competitive minivan, for instance. Their small crossovers and SUVs haven't kept pace with the best offerings from Honda and Toyota. And a puny "B car" that's actually fun, like the Mini Cooper or Honda Fit? Does not compute. And it's pretty hard to survive as a global car company when you simply write off a big chunk of the market.
The same guys asking for handouts are the ones who caused the problems. Not really. Chrysler CEO Bob Nardelli and Ford CEO Alan Mulally are new arrivals recruited from outside the auto industry. Their boards offered them a lot of money because of their expertise fixing huge, messed-up organizations. Wagoner has been on the job longer, and he bears more responsibility for some of GM's problems. But he wasn't in charge in the 1980s and 1990s, when GM built sprawling factories that are approaching obsolescence, let quality slip, and short-shrifted cars in favor of SUVs. And since becoming CEO in 2000, Wagoner has overseen many improvements at GM, like an improved car lineup, more efficient factories, and success in China and other overseas markets. He may still get the boot, but he's probably done more to fix GM than the three or four CEOs who preceded him.
The CEOs should fly coach. At about the same time the Detroit 3 CEOs were boarding corporate jets to head to Washington for recent congressional hearings, Northwest Flight 234 (on-time percentage: 77 percent) was backing away from the gate at Detroit Metro, headed for Reagan National Airport, across the river from the Capitol building. Obviously, the CEOs should have been on that flight instead of a Gulfstream, relaxing with some free coffee and reading the morning paper before huddling with aides (please remain seated, with your seatbelts fastened) to discuss emergency measures like which division to sell off or which supplier to stop paying. They'd have to speak in whispers, since a couple dozen reporters looking for a scoop would no doubt be sitting in nearby rows—but at least that way nobody would disturb other passengers trying to catch a nap. And if there were any urgent calls from outposts in Shanghai or Dubai, United Arab Emirates, or São Paolo, Brazil, somebody back at HQ with a reliable phone connection could just handle it.
Sure, these are complex global companies with command decisions that need to be made every hour. But if the CEOs are going to ask for the people's money, they should take the people's transportation! Come to think of it, instead of flying, they should have pooled their money and chartered a bus for the trip to Washington.
It's all the unions' fault. Generous union protections clearly pumped up Detroit's costs in the past and added to bloat, but recent concessions have solved many of those problems. Many other factors now weigh more heavily on Detroit: Soaring healthcare costs, especially for retirees the automakers are still responsible for; poor strategic planning; and buyers who can't get loans. The biggest problem with the unions might be unrealistic expectations fostered by leaders like Ron Gettelfinger—because many of the job and wage protections of the past are no longer there.
They've done nothing to help themselves. All three Detroit automakers have slashed costs and closed factories over the past few years, in aggressive but methodical efforts to become profitable once again. If we still had the 2006 economy, they might make it by 2010 or 2012. But obviously we don't. What the Detroit Three haven't done is something dramatic that would send the silverware flying, like killing off overlapping divisions such as Mercury, Pontiac, and Saturn, closing redundant dealerships, or demanding universal healthcare to help manage soaring medical costs. If the government coughs up some "bridge" money to tide them over for a few months, there's no reason to think much would change. But if the automakers land in bankruptcy, plenty will change—and self-help will no longer be an option

[j2k4]

http://www.usnews.com/blogs/flowchar...-chrysler.html

6 Myths About GM, Ford, and Chrysler

November 20, 2008 12:42 PM ET | Rick Newman | Permanent Link | Print
Memo to CEOs: Ask for a bailout, and your company will be reduced to a caricature.
Recent congressional hearings on the plight of GM, Ford, and Chrysler have illuminated a few important issues—like how the Detroit executives travel when on business. Populist politicians and gotcha journalists delighted at the prospect of rich CEOs riding corporate jets to ask for taxpayer money. There was a little talk about jobs and cars and the foundering economy, too. But you might have missed that part, or gotten confused by a welter of misperceptions that emerged from the spectacle of supplicant CEOs trying last-ditch tactics to save their companies.
As the automakers careen toward bankruptcy, here are some of the myths complicating the debate over the future of the Detroit Three:
They don't build small cars. The Detroit Three build plenty of small cars—they're just not very good. In the U.S.News rankings of affordable small cars, for instance, seven out of 34 models are domestics. But the highest ranked—the Chevrolet Cobalt—lands at No. 20, while the top three are all Hondas. So, CEO Rick Wagoner is telling the truth when he says that in 2009 GM will offer 20 models (including a few mid-sized cars, a couple small sports cars, and a few others) that will get 30 mpg on the highway. The question is whether anybody will want to buy them—and if not, is it the government's job to subsidize uncompetitive products.
They don't build any desirable cars. A few recent Detroit models have been hits, like the Ford Fusion, Chevrolet Malibu, Cadillac CTS, and Saturn Outlook. And even Consumer Reports, which has mercilessly trashed Detroit's shoddier vehicles, recently issued a statement saying, "We've seen some progress among the domestic automakers lately, with improved reliability and performance in certain models."
The problem is that the domestics are strong in a few segments, while weak—or nonexistent—in many others. So when soaring gas prices and a stumbling economy torpedoed their flagship vehicles—trucks and SUVs—there wasn't much else to balance out the portfolio. Neither GM nor Ford offers a competitive minivan, for instance. Their small crossovers and SUVs haven't kept pace with the best offerings from Honda and Toyota. And a puny "B car" that's actually fun, like the Mini Cooper or Honda Fit? Does not compute. And it's pretty hard to survive as a global car company when you simply write off a big chunk of the market.


The same guys asking for handouts are the ones who caused the problems. Not really. Chrysler CEO Bob Nardelli and Ford CEO Alan Mulally are new arrivals recruited from outside the auto industry. Their boards offered them a lot of money because of their expertise fixing huge, messed-up organizations. Wagoner has been on the job longer, and he bears more responsibility for some of GM's problems. But he wasn't in charge in the 1980s and 1990s, when GM built sprawling factories that are approaching obsolescence, let quality slip, and short-shrifted cars in favor of SUVs. And since becoming CEO in 2000, Wagoner has overseen many improvements at GM, like an improved car lineup, more efficient factories, and success in China and other overseas markets. He may still get the boot, but he's probably done more to fix GM than the three or four CEOs who preceded him.
The CEOs should fly coach. At about the same time the Detroit 3 CEOs were boarding corporate jets to head to Washington for recent congressional hearings, Northwest Flight 234 (on-time percentage: 77 percent) was backing away from the gate at Detroit Metro, headed for Reagan National Airport, across the river from the Capitol building. Obviously, the CEOs should have been on that flight instead of a Gulfstream, relaxing with some free coffee and reading the morning paper before huddling with aides (please remain seated, with your seatbelts fastened) to discuss emergency measures like which division to sell off or which supplier to stop paying. They'd have to speak in whispers, since a couple dozen reporters looking for a scoop would no doubt be sitting in nearby rows—but at least that way nobody would disturb other passengers trying to catch a nap. And if there were any urgent calls from outposts in Shanghai or Dubai, United Arab Emirates, or São Paolo, Brazil, somebody back at HQ with a reliable phone connection could just handle it.
Sure, these are complex global companies with command decisions that need to be made every hour. But if the CEOs are going to ask for the people's money, they should take the people's transportation! Come to think of it, instead of flying, they should have pooled their money and chartered a bus for the trip to Washington.
It's all the unions' fault. Generous union protections clearly pumped up Detroit's costs in the past and added to bloat, but recent concessions have solved many of those problems. Many other factors now weigh more heavily on Detroit: Soaring healthcare costs, especially for retirees the automakers are still responsible for; poor strategic planning; and buyers who can't get loans. The biggest problem with the unions might be unrealistic expectations fostered by leaders like Ron Gettelfinger—because many of the job and wage protections of the past are no longer there.
They've done nothing to help themselves. All three Detroit automakers have slashed costs and closed factories over the past few years, in aggressive but methodical efforts to become profitable once again. If we still had the 2006 economy, they might make it by 2010 or 2012. But obviously we don't. What the Detroit Three haven't done is something dramatic that would send the silverware flying, like killing off overlapping divisions such as Mercury, Pontiac, and Saturn, closing redundant dealerships, or demanding universal healthcare to help manage soaring medical costs. If the government coughs up some "bridge" money to tide them over for a few months, there's no reason to think much would change. But if the automakers land in bankruptcy, plenty will change—and self-help will no longer be an option

Oh.

Then perhaps your facility with Google will reveal precisely what-the-fuck their problem actually is.

Say what you like about the economy, now, then, Clinton, Bush, whatever, the health of the auto industry idea-wise and/or economically, has been in the dumper for decades.

Forget for a moment your impulse to oppose me, and actually look at the situation, ffs.

[devilsadvocate]

Oh.

Then perhaps your facility with Google will reveal precisely what-the-fuck their problem actually is.
It had nothing to do with google, it was a newsite and it points out many problems
Say what you like about the economy, now, then, Clinton, Bush, whatever, the health of the auto industry idea-wise and/or economically, has been in the dumper for decades.
Can't say I disagree

Forget for a moment your impulse to oppose me, and actually look at the situation, ffs.

I am looking at the situation and I'm doing it without prejudice instead of talking points, misrepresentations and favorite ideological punching bags.

[j2k4]

Oh.

Then perhaps your facility with Google will reveal precisely what-the-fuck their problem actually is.
It had nothing to do with google, it was a newsite and it points out many problems
Say what you like about the economy, now, then, Clinton, Bush, whatever, the health of the auto industry idea-wise and/or economically, has been in the dumper for decades.
Can't say I disagree

Forget for a moment your impulse to oppose me, and actually look at the situation, ffs.

I am looking at the situation and I'm doing it without prejudice instead of talking points, misrepresentations and favorite ideological punching bags.

As to your first, I disagree.

As to your second, perhaps the ideological punching bags should change their stripes, then.

[j2k4]

A related item...

http://www.youtube.com/watch?v=ufexZ...ef=patrick.net

[thewizeard]

...receive a government (read taxpayer-funded) bailout.

Only if they are developing water powered cars or working in a similar way to conserve our enviroment.

[j2k4]

...receive a government (read taxpayer-funded) bailout.

Only if they are developing water powered cars or working in a similar way to conserve our enviroment.

None of that is being contemplated, I promise you.

[clocker]

I've been reading quite a bit of "push-back" on car sites regarding Washington's insistence that the Big Three come back with more detailed plans before given access to the trough.

The two main points seems to be-
-It should be obvious by now what they plan on doing, labor contracts have been being renegotiated for the last three years and they've shown the models they're working on (see: Chevy Volt).

-Exposing their detailed plans to the world will give their competitors an unfair advantage.

I think both arguments are bullshit.
Any supplicant to a bank looking for a loan is required to be clinically detailed about their business model/plan- they can't just say it's obvious that they are worthy and "Trust me". Furthermore, after the initial bailout of the banks/insurance industry, Congress is not willing to withstand the PR nightmare associated with handing money over to executives with such a longstanding history of entitlement...the "burn me once, shame on you, burn me twice, shame on me" truism made real.

The only way Nissan or Honda might benefit from a look at GM's future plans would be as a roadmap to What Not To Do. The idea that the Big Three have anything that Japan or Korea would find useful is ludicrous- akin to the class dunce claiming that the smart guys are cribbing from him.

An interesting sidenote occurred at the LA Car Show this week...the Volkswagon Jetta TDI was named the "Green Car of the Year". Without using any exotic technology, the Jetta is 50 state legal and gets 41mpg (highway).
One of my brothers just bought one and says it's a blast to drive.
Without prior notice, he says you'd never know it was a diesel...it's quiet, fast and handles great in the snow. He has been averaging close to 40mpg in combined city/highway driving so far.
Both Ford and GM make diesels in Europe but haven't brought any to the States. GM is considering doing it sometime in 2010 but only in V-8 form for trucks.
This shows more starkly than anything why the BIG Three deserve the big nut-kicking they are currently getting.
Volksawagon can't keep the TDI in stock and GM is considering bringing the same same technology to our market...in two years and in truck form.
Now, tell me again why these dunces deserve a bailout?