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200 Comments
- AmyVernon, on 11/19/2008, -1/+45I'd say 1&4 were the biggest issues. Make crappy cars, people don't buy. Even if they get better, it takes a long time for people to accept that quality's improved. And when you put all your eggs in one basket (trucks/SUVs), you make yourself vulnerable to shifting markets. Toyota and Honda got their real foothold in the American market back during the '70s gas crisis. Did the American car companies not think that would ever happen again?
- Trekhawk, on 11/19/2008, -11/+44The article alluded to, but didn't explicitly state the number 1 reason: UAW.
- SilverBlade2k, on 11/20/2008, -3/+301) Greedy unions
2) ***** products that spend more time being looked at by mechanics then on the road..
3) Relying on gas guzzlers instead of researching into fuel efficient technologies until it is too late.
4) Poor Management and business decisions (Like..oh..favoring their Hummer line and trashing the old EV-1)
5) Greedy Unions. - inactive, on 11/19/2008, -5/+31How about they stop making ***** cars like the PT cruiser
- Trekhawk, on 11/19/2008, -0/+22Tell that to Toyota, maker of the:
-Sequoia
-Land Cruiser
-Forerunner
-Highlander
-Rav4 and
-2 fuel-efficient cars (Corolla, Prius) - Dinsdale77, on 11/19/2008, -9/+30Unions
- billwild, on 11/20/2008, -1/+19They award 20 million dollar bonuses to execs when the company loses billions --this was as recent as last year . They use their weight to change the the laws in favor of their gas guzzling cars and against environmental stewardship. They recall and destroy a fleet of EV1s . They hire talking heads to spout lies and use fear mongering tactics to try and get the public to support a bail out.
I have no sympathy.
Dont let the door hit ya.... - BESTenemy, on 11/20/2008, -0/+16 Because of HELOC - Home Equity Lines Of Credit that were allowing people to buy cars they could not afford by tapping into the inflated values of their properties.
On top of that organizations such as GMAC - General Motors Acceptance Corporation, a flavor of which exists for every brand of car and truck, allowed unqualified borrowers to get approved credit, cooking the books much like Freddie and Fannie did with mortgages.
People were living in houses they could not afford, taking out cash to spend on new Hummers and BMW's instead of driving used Ford's and Honda's.
What the car manufacturers don't get is that the potential buyer that had been incorporated into their business models never existed in first place. People were not rich enough to drive their cars. As a result, they're not only going to see lost like this one, but also new parkades full of barely-driven repossessed vehicles that will take them years to sell.
Frugality is the new reality. - nimbletimble, on 11/19/2008, -6/+22Here's what me and my friends drive:
Audi, VW, Merc, Range Rover. American cars just don't appeal in Europe for starters.
Before you dig me down, my mum drives a Ford so it's happy days after all.... - Hetman, on 11/19/2008, -3/+19They offer a product that no one wants, and if someone wants it they cannot afford them. It is that simple. Bailing them out is not going to do anything except delay the inevetable. Unfortunatly sometimes companies have to fail.
- inactive, on 11/20/2008, -2/+16Dear Auto Companies,
MOST people want 3 things in a new car.
1) Good price $15K or less
2) Good MPG 35+
3) Good reliability. There are over 100 years in auto engineering, figure it out.
I don't give a ***** about stupid "innovative" features. I like to be able to go from point A to point B without paying a lot for repairs and gasoline. - BeShirtHappy, on 11/19/2008, -2/+15Things will turn around sooner or later... will it be too late for GM and other car companies? One of the biggest waste of money though is on a new vehicle - better to buy a used car.
- Grok22, on 11/20/2008, -1/+14Once the unions run the company into the ground iI'm sure the workers will be better off.
FTA:
"GM's per-hour labor rate for car assembly is about $75 per hour, compared to $40 to $45 for other car companies."
- While it may not be ideal to work for the other companies, at least they will have a job when
GM fails. - jgopp, on 11/20/2008, -1/+14Yeah, it's been said many times, once the trust is broken by a company it takes years and years before they will even reconsider, if ever. My experience is that people who bought big three cars in the 70s-80s-90s feel betrayed and switched to other brands. And now that GM makes quality cars like the Malibu and the CTS (cars of the year), those buyers are still unwilling to look because of the problems from the past. I've said it once and I'll say it again, it is worth looking at the new CTS, Malibu, Ford Fusion, Mecury Mariner hybrid, because they are all great cars the big three has turned the corner on quality (minus Chrysler) but unfortunately some people never will be able to trust them again.
- inactive, on 11/20/2008, -3/+16Any company that put the Pontiac Aztec on the market deserves to fail.
- GoneGreen, on 11/20/2008, -4/+17GM had the EV1 then replaced it with the HUMMER. You don't have to be a mastermind to see where they went wrong there.
- paulvq, on 11/20/2008, -0/+12No, I will not digg your unrelated article.
- MikeMitchell, on 11/20/2008, -4/+16GM got greedy, made too many SUVs, trucks and cars that aren't sustainable, and idiots bought them.
They deserve to go under, and the people who want nothing less then a raised Suburban to drive around in by themselves deserve a Smart car. - allaboutdatiki, on 11/19/2008, -0/+12Make that three fuel-efficient cars ... don't forget the mighty little Yaris.
- headlessclown, on 11/20/2008, -2/+13when a company spends over $17 million a year on viagra as benefits for its former employees (the largest purchaser of viagra), they've obviously got some management issues.
- roxgod666, on 11/19/2008, -0/+11Does this mean no more Hummers?
- GammaStream, on 11/19/2008, -4/+15It's pretty obvious; American cars just aren't very good. Jeremy Clarkson on Pontiacs:
http://uk.youtube.com/watch?v=Aj6Rp6p_DYU - pinchduck, on 11/20/2008, -0/+10I wonder if the bonehead who made the decision to drop quality production techniques in the 70's is now wondering why his pension and health care are in danger. Yeah, buddy, you saved $70 per car in 1973. How much has it cost you since? We're still tallying that bill.
- d0nkeym0nkey, on 11/19/2008, -9/+19I don't mean to be a troll, but American cars just plain suck. Old technologically outdated oil suckers and i don't mean just the SUVs. No wonder Toyota overtook GM in sales in the US.
- inactive, on 11/19/2008, -2/+12It is true the quality has improved, but what about the styling? US automakers, especially GM designs have been so disappointing! Now that they are turning things around with design and smaller vehicles, even if they get the loans, is it to late? Lets hope for the US economy these automakers survive.
- dsmx, on 11/20/2008, -0/+9Ford also used to own aston martin but chose to sell them, which seems a bit odd as it was the only part of fords business that was making money.
- Jenovaside, on 11/19/2008, -3/+121-5 "legacy costs" that's really the core issue. Anyone who says otherwise does not know what they are talking about.
- inactive, on 11/19/2008, -2/+10American manufacturers don't expect their brands to be popular in Europe, so that's not part of the problem at all. They bought European brands for that purpose... i.e. GM owns Opel, Saab, and Vauxhall. Ford owns Volvo.
- tawnos, on 11/19/2008, -4/+12Now is not the time to be selling SUVs.
- mogebier, on 11/20/2008, -2/+10On the news today they said that GM's cost per-hour per worker on the line is $71 when you factor in everything (Healthcare, pensions, retirement etc etc)
Toyota is only $40.
So the average GM car has to e priced $2000 more than a comparable Toyota.
The Unions are killing the car industry. - Grok22, on 11/20/2008, -0/+8@Antilleis
FTA: " GM's per-hour labor rate for car assembly is about $75 per hour, compared to $40 to $45 for other car companies."
while the guy making the car may not be getting $75 an hour, counting dependents and insurance it costs GM $75/hour to have than man work while it is only costing the other companies $40/hour. - cubicledrone, on 11/19/2008, -4/+111. Management
2. Management
3. Powerpoint
4. Meetings
5. Management
That about cover it? - budgetguitar, on 11/20/2008, -3/+10dinsdale77 is right.
Labor unions are sucking the life out of the American auto industry. They demand more than the industry can yield. Add legacy expenses like pensions and guaranteed retirement benefits and it's no wonder all their money is going to former executives and $80 and hour assembly line workers. Add to that the fact that a majority of people don't see American cars as a high quality machine anymore and this is what you get.
Out with the old and in with the new... - wrenchone, on 11/20/2008, -3/+10You seem to have left Unions off that list.
- duewydo, on 11/19/2008, -4/+11They forgot to mention the real big reasons. Such as lack of true innovation, keeping up with the times, styling, quality and lastly their stupid legacy obligations with pensions. What they mentioned was the straw the broke the camel’s back.
- NotYourProdigy, on 11/20/2008, -0/+7@mm911
Its not a problem when American companies don't expect their cars to sell anywhere other than the U.S.? That's one of the main problems in our largest companies. There is money to be had across this whole planet. - ajb2015, on 11/20/2008, -0/+7why is he being dugg down, the pt cruiser is made by chrysler
- berational, on 11/20/2008, -1/+8uhh. I work 50-60 hours weeks. :)
UAW can do good for the workers, but when they turn into a parisite and kill the host they have gone too far. If the UAW was working in the intrest of the workers it would be working with the automakers to provide some additional consessions right now, but they are being obtuse. When GM goes bust all those contracts and pensions are worthless. - breakaway, on 11/20/2008, -1/+7One thing I don't understand is how exactly this happened. Didn't these companies make many billions of dollars every year? And now they are 'out of money'?
Is the concept of putting money away for a rainy day unknown to these people? - leif77, on 11/20/2008, -4/+10your friends have money... nice...
- billbugger, on 11/20/2008, -1/+7The also own Lexus.
- mythicflux, on 11/20/2008, -0/+6Thank you. As the article points out US automakers are stuck paying huge amounts of money for things that have nothing to do with producing and selling cars. And these costs are being passed on to consumers. I remember reading a couple of years back about GM (or Ford) shutting down a factory to cut costs. Of course my definition of shutting down doesn't match theirs. The facility was left intact, employees still showed up for 8 hours a day and still had full pay and benefits. The factory simply didn't do anything. All of these people were able to sit around and do jack simply because some union contract had tied the companies hands.
So of course instead of spending that $2000 dollars per car on research and development, automakers are stuck with a huge competitive disadvantage forcing them to cut corners and produce less innovative products. - inactive, on 11/20/2008, -0/+6Uh, I'd say it's a terrible time to be looking at those cars because the resale value will be about the same as a hot turd once they file for bankruptcy. Once the manufacturers are gone so are the parts and soon the mechanics. It will be a cascade if they file.
There's very little public support for bailing out these failed companies. - Trekhawk, on 11/19/2008, -1/+7Correct. Valid point.
- inactive, on 11/20/2008, -0/+6Or they live in Europe where they make European cars.
- inactive, on 11/20/2008, -0/+6Hopefully. And if we're real lucky the egos of the pricks that drive them will become extinct as well.
- asgardshill, on 11/20/2008, -0/+6Roger Smith should have taken Michael Moore up on his offer and not kept ducking him. The old fart might have had some sense talked into him.
(I wonder how Frankenmeuth and the "Pets Or Meat" lady are doing these days?) - NotYourProdigy, on 11/20/2008, -1/+6heres what I say: You want $25 Billion of ours? Not one penny should be spent on a combustion engine anything. Try something else.
- inactive, on 11/20/2008, -0/+5ooohh so close......you got the first two "theirs" right.
- BESTenemy, on 11/20/2008, -1/+6 One reason GM and Ford need bankruptcy in order to survive is because it will allow them to get out of long term contracts with United Autoworkers Union. It'll take care of legacy costs by offloading retirement obligations onto the government (not saying that the government can actually handle 750 000 additional obligations).
The union prevents close integration of supplier production lines and it keeps wages from falling during deflation. Combined, those things inflate the cost of every car produced by almost $5000 according to current estimates. -
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