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Originally Posted by Fraxum
We can disagree. Sure sell the trucks. Even though the automotive world has known for at least 10 years they are dead ducks. There is only so much oil n the ground. But why weren't those GM executive geniuses investing the profits they were raking in on the super-gulp sized trucks making better cars? Those big trucks were very profitable. Instead they wasted the chance and left the biggest automotive company in the world with their pants down. Only sad Chrysler is worse off. And there are plenty of GM execs with golden parachutes who walked away from this mess tapping their heels before and after the financial crisis. It is the worker level men and women who get royally screwed who are now on food stamps.
GM upper management has ravaged what was the number one auto manufacturer in the world and has helped turn the US midwest into a wasteland.
All that being said I like the 2010 Camaro. There is some hope for the "new" GM. I just wish the roof was 2 inches higher and it was 2 hundred pounds lighter.  But GM will never again be what it was. |
Dead ducks? The Ford F150 is selling like hot cakes, and even though GM has had to close plants, the Full Size Pickup remains GMs number one seller.
I appreciate your opinion, Fraxum, I read it and hear it all the time. But it is basically 20/20 hindsight to say what they should have done.
If you were in business (maybe you are) would you have the ability to stop your most profitable product to go build cars fewer people want to buy and you make almost no money? This isn't Europe with $8 gas that allows all the companies to sell $30,000 Cobalts and Focusesss (Focii?).
So as you want to blame GM execs. Oh wait did you hear the one about all the execs that had been retired for years and had the pensions basically taken away? Oh no you didn't because you wouldn't have made your statements
Here is what happened. You may not want to hear the truth because it goes against blaming people.
GM once had over 400,000 employees in this country alone. GM was so big that in the late 50's the U.S. Government tried to break them up. GM ruled the automotive landscape.
Now comes the 70s and there are more and more and more foreign manufacturers wanting a piece of that pie. And Americans, loving free choice bought in. Market share started to tumble. Now you can fantasize about how great those cars were, but 1970s Toyotas and Honda weren't great cars. I won't argue better or worse, but they sure weren't great. Especially in the Mid West were they rusted to the ground.
Now this pressure, primarily came from Japan. Here are two main advantages that they had.
First, they did not have to pay health care to their employees or to their retirees. This amounted to about a $1,500 advantage for every car all things being equal. And the Japanese government, as they do today and China now emulates, controls the value of the Yen to favor their exports. This is arguably another $1,000 to $1,500 advantage per car. Now they don't have to do anything different, just sell an equal car and make pure profit of $2,500 to $3,000 per car. So with that extra money they can use their own (look up kieretsu) suppliers to keep even more profit in Japan.
All the while, GM is losing a little bit of market share every year. They have every year but 2 that I've worked here. And every one of those 400,000 employees is still getting Health Care and Pension benefits. To put that in perspective I think GM now has about 60,000 hourly and 20,000 salary employees. So the burden is basically a game to get that balanced. GM was paying for 3 retirees for every worker. Imagine you business case if you simply owned a lawn mowing company and had 3 workers sitting at home collecting pay and benefits for every guy working. So how do you keep that enterprise going? You have to keep selling your most expensive vehicles. You need cash flow. And that came from trucks.
So as an American, you whine about the downfall of the big 3 and blame managment all you want. This story has so many parts and you could probably teach many classes on business, sociology, government on it.
Now you could go back and say look at Ford. Well back in the late 70s and early 80s, Ford was laying off workers right and left. GM wasn't, they tried to ride it out. Probably not a good move in hind sight because thay gave Ford and advantage of their retiree to worker ration that was much better than GMs by the late 90s early 2000s. Their legacy costs and debt were far lower. Not because they were better or smarter, but because they laid people off years ago rather than hanging on.
So was GM stupid for always believing they could get back to ridiculous levels of market share? Maybe.
Look this is a tragic story for GM workers and families and for our country. But to blame "fat cat executives" as the only reason isn't getting at the whole story.
Why do you think we no longer have a textile industry in this country? Why do you think Big Steel lead the auto industry in this same downsizing? Why do we not have an electronics industry here? Heck we invented nearly every major electronic convenience, but for some reason we don't build any of them.
Again, I appreciate your thoughts on this topic. I know where it comes from. But the story is just wayyyyyyy bigger than what you want it to be.