Why do you think the U.S. auto industry is falling apart?

In My Humble Opinion
1

I don’t want a debate; I seek your perceptions.

From my perception, it is definitely a combination of factors:

  1. I percieve their products as junk. Reading reviews reinforces this notion. I would NEVER buy a small American car. I do own a Dodge Dakota Quad Cab, but regret that I didn’t buy a Toyota Tundra.

  2. When I look at a company like Toyota, I think quality/longevity…and a distinct product line - well thought out.

  3. When I look at foreign brands like Honda, Toyota, Nissan, it is very clear what their product line-up is.

Take Toyota:

Scion = entry level/sport/tuner…
Toyota= midddle America…Corolla up to Avalon, something for everyone
Lexus = Premium Brand

Take GM:

Chevy = entry level??? Not really… Corvette (which I think should be it’s own brand)
Buick = Cataract glasses on driver and Kleenex box on back window ledge???
Pontiac = sport???
GMC= trucks…but the same as the other divisions?
Cadillac= premium, but seem like premium Buicks, not Lexus killers.

Don’t even get me started on Ford…Lincoln…Mercury, whatever.

Worse yet, young people don’t want U.S. cars. And from the looks of it, U.S. mfgrs don’t want the young people. The ‘tuner’ crowd is cutting their teeth on Japanese cars…movies are made about Japanese cars.

GM and Ford can’t even enhance their brand image by rolling out an honest to goodness attempt to produce a NASCAR inspired model that is actually worth anything!

And then, there are the high costs of the Unions…

2

American Graffiti
Corvette Summer
Smokey And The Bandit

:wink:

3

Showing your age… :wink:

4

Songs too…:

  • little red corvette
  • hot rod lincoln
  • mustang sally
  • little 409

(Probably more I can’t think of right now…)

It’s cyclical this entire auto industry thing. Cars fall in and out of favour depending on market trends and advertising campaigns.

Who would have thought, for example, that SUVs would make such an impact.

5

IMHO, there are a couple of reasons for the decline of the US auto industry:

-High cost of unions, as you mentioned, who also counts the extraordinary liabilities the automakers carry in pensions and health care for retired workers
-Lack of any attention on the small car market. I agree with you that US automakers don’t seem to care at all about these buyers, which ties into
-Over-reliance on trucks and SUvs, which have a very high profit margin. But, you can’t base an entire company around them. You need to base your company on small and mid-sized sedans.
-Squandered public goodwill. By this I mean that US automakers made crappy cars for so long, and ignored the demands of consumers that even now when they are making significantly better cars, everyone still thinks that Japanese automakers are better quality. It will take a long time to change this perception.
-Poor “soft” details. While mechanically able, today’s Big Three cars STILL suffer from underwhelming interior and exterior aesthetics.
-More emphasis on “flavor-of-the-month” than boring longevity. Unfortunately, most people who buy cars are not people who are interested in cars. Search this forum, and the words you will find most about people looking for a car are “good gas mileage” and “reliable”. That is all people care about. Unfortunately, the Big Three have not focused on these attributes very much. Instead, they’ve gone for “sporty” or “most cargo capacity” or whatever. These are important, but they are not why people buy normal cars.

I could go on and on, but I think these are some main issues.

6

Cars I’ve owned:

1966 MGB
1966 MGB (currently in restoration)
1977 MGB
1977 MGB
1977½ Porsche 924
1979 Porsche 911SC
1948 Willys CJ2A
1946 Willys CJ2A
1984 Chevrolet (Suzuki) Sprint
1988 Chevrolet (Suzuki) Sprint Metro
1963 Triumph Herald
1999 Jeep Cherokee (my first new car)

As you can see, most of the cars I’ve owned (even the Chevys) are foreign. I was a teenager in the mid-'70s and early-'80s. My first car was a hand-me-down '66 MGB. My parents got Toyotas in 1972. So I grew up with foreign cars. In 1973 we had the Oil Embargo. At the time U.S. auto makers were making land-yachts, and they continued making them even after the second embargo in 1979. Though the MGs had ‘British problems’, they were tight little cars. My best fiend had a 1972 Buick Skylark that was a POS.

From my perspective American cars were too big, didn’t handle well, didn’t look good, and burned too much gas. When U.S. automakers tried to compete with the Japanese it seemed to me to be a slap-dash job. I remember hearing about the poor build quality, and fuel efficiency seemed to lag behind the imports. In the 1980s it was more of the same.

Then in the mid-1980s a friend’s father got a new Ford Thinderbird. Its styling was fresh for the time. Then there was the Ford Taurus. That was a sharp-looking car in its day too, as was the new Pontiac Firebird/Trans Am/Chevy Camero. My impression at the time was that U.S. automakers were finally catching up to the Japanese. But my tastes still ran toward smaller, more efficient cars.

At the time Japanese cars seemed to become more ‘tinny’, probably as a weight-saving measure. American cars seemed to be just as cheaply made. And there were a lot of new American cars around. They seemed to deteriorate as quickly as the low-end Japanese models. Then came the SUVs…

I was driving a 911 in the mid-to-late-'90s. Very solid car, and fast!. SUVs were just too big. But eventually I found that the 911 was too small for my needs at the time. I was going to get a Honda Civic, which was small, efficient, and could carry more gear than the Porsche; but I got the Cherokee (the smallest ‘real’ SUV) instead. It’s been great. But it still suffers from relatively poor mileage. Gas was relatively cheap, and everybody was driving SUVs. I still longed for a small, efficient car, but I liked being able to haul stuff and people in the Jeep.

Anyway, it’s been obvious for a few years now that cars are too big. Even when the economy took a nosedive and gas prices rose sharply, Detroit was pumping out monster-sized vehicles. It looked to me like a repeat of the mid-1970s: The Japanese were improving their small cars, and Detroit was (and is) burying it’s head in the sand. ‘Americans want big, powerful cars!’ That’s what they said in the '70s, and they paid a price.

So IMO the U.S. auto industry is falling apart because they do not recognise trends. At least, they do not recognise trends that point to small cars. They’re all about offering more power and bigger cars. They met the SUV fad with gusto. But while the Japanese looked at hybrids, they made only half-hearted steps and kept making behemoths. Quality has improved over the past 20 years, but there are still a lot of people who remember the Bad Old Days. Costs rise as unions demand more. But I think the big reason the industry is falling apart is that they are always a step behind what the public wants.

7

Heh. Just heard on CNN that Ford will now ‘listen to the customers instead of just filling factories’. U.S. carmakers should have been listening to customers all along.

8

True, but the American customers have been saying “Bigger and faster, gasoline be damned!” It’s a wink-wink game between the manufacturers and the buying public. The manufacturers say “You need this car, you want it,” and the public responds “Yes! yes we do,” without thinking about the practicality or cost of operating a 10-15 mpg vehicle. The $3+/gallon gas price in the CONUS was a shocking wake-up, but we’ve since forgotten about it as prices slipped below $2.50/ gallon in most places.
No one wants to take the lead and start weaning us off of cheap gas and start marketing less oil-dependant vehicles as the standard, rather than as an exception or a niche product.

Vlad/Igor

9

The Japanese do. :wink:

10

Unions and tax rates that favor foreign countries. There’s a reason it’s Daimler-Chrysler and not Chyrsler-Daimler.

11

Sorry, that last post was sort of a mid-stream response. Let me backfill:

In addition to the unions, less-than-exciting offerings from the US auto manufacturers and their lingering reputation from the 70s and 80s, they also made oversized and under-efficient trucks and SUVs a significant contributer to their profits. As long as people didn’t care about the operating costs of trucks and SUVs, there was no incentive to explore other classes of vehicles or oil-sparing technologies.

Now that we’ve had a look at how easily fuel costs can rise to significantly impact our income, we’re starting to have second thoughts about buying trucks or SUVs (I hope, anyway, but I’m not optimistic about that). Last summer’s gas price spike isn’t an anomaly; we’re still in the high part of the Atlantic Ocean cycle that has produced the large number of hurricanes in 2004 and 2005, and 2006 may well not be much different. All it takes is one strong storm in the Gulf and we could easily see $3+/gallon gas prices again.

So, without a wide variety of products, the auto manufacturers are losing money as people start to switch to smaller, more efficient vehicles, and the manufacturers haven’t got much to offer except more, more, more of the same. There have been token attempts at producing alternative vehicles, but none of the manufacturers are willing to carry them long enough as part of their normal stock to get the public used to the technology. And unfortunately, the buying public isn’t going to willingly consider alternative technologies until they start having to think twice about taking that last-minute week-end trip, or turn down the thermostat again to avoid another $600 heating bill for December.

Vlad/Igor

12

A case in point: the EV-1. I saw several when I lived in SoCal. Then they were gone. It turns out that they could only be leased, and GM cancelled the leases. I heard (i.e., hearsay) that there were people who liked the cars so much they tried to hide them rather than give them up. If people are willing to go to such means to keep a vehicle, then it sounds as if it would be a strong message to the manufacturer.

I have yet to see a Smart in the U.S., except when a couple were on display at a mall in Orange a few years ago.

13

I think there’s a lot of unfair bagging on domestic auto makers going on. Some of that is historical, due to previous bad cars and long memories. Some of it is pure snobbery from the ‘fast and furious’ crowd.

If you look at current vehicles, the domestics actually have good reliability ratings. The newest generation of cars (C6 Vette, Ford Fusion, Chrysler 300, etc) are extremely well built, get good has mileage, and match the imports for fit and finish.

The good news for domestic auto manufacturers is that pretty much everyone agrees that the playing field is now pretty level in terms of quality, and therefore design is going to be increasingly important in differentiating cars. And the U.S. manufacturers are as good as anyone at design. The Fusion beats the hell out of those egg-shaped bland boxes like the Altima and the Camry. The 300 is very unique. And the new generation of cars coming down the pike should be really interesting.

There’s still the problem of the high cost of all the health care liability and higher workforce costs in the unionized factories. Every GM car carries about $1500 in health care costs - that’s $1500 that other manufacturers can put into better interiors, better engines, more features, or lower prices.

14

I think that the fact that GM et al are based in Detroit is a problem. Folks in the mid-west just think differently from folks on the coasts. It’s just not practical to drive a big junker in CA; gas is too expensive and parking is tough. The mid-west has a lot fewer imports; the designers and engineers are stuck in a time warp since all they ever see are American cars. When I talk to my brother in-law who works at GM, he’s concerned with things like unibody vs ladderframe chassis. I just want a car that’s small on the outside, has a large trunk, and is reasonably attractive (no faux wood trim, chrome, ugly Fischer radios, etc.)

The fact that the US auto industry is shrinking means you don’t have enough new blood to shake things up. I’d like to see design centers in LA and/or SF. Sick Frog Design on them.

15

I think it is the entrenchment of the auto industry. After the backlash against imports, I think a lot of people bought American cars simply because they weren’t foreign, not creating a lot of pressure to make them that good. If you ask people why they buy American cars, a lot of them will say that it is because they are American. Note, that Ford, for example has been making lots of nice cars in Europe for the past 5 years or so. Unfortunately we can’t get them in the US. Take a look at these at ford.co.uk Most of them are small, and the fit and finish is great. I’ve driven one of these before. Almost on par with German cars of the early nineties. The American line is finally starting to catch up with things like the Ford 500 and the Fusion, but there are still a lot of problems. I remember one model of the Ford F150. The stereo was terrible with all of these bubbles everywhere. That’s one reason why German cars are always kind of timeless. They are conservative, but modern and almost always pleasing. Cars aren’t like the latest passing trend. You want something that isn’t too crazy. Also note that they also offer fuel-saving diesel engines.

16

What? I’m not down on the Fusion or anything, because I’ve heard good thing about it, but you can’t seriously think that the Fusion looks much different than an Altima or something. It looks like an oversized Civic with a slightly more stylish front end.

17

Are Smarts even street-legal in the U.S.? I see them on the roads quite often in Canada.

18

I love my Chevy, my husband loves his Chevy, and we plan to get another one next year.

My perception of the American auto industry is that they blew it in the 80s and for whatever reason, no one will every forgive them for it.

19

Detroit is still living in the days when they were the only major players in the the US, as well as in most parts of the world. Whatever they built, we would buy. Simple as that. Detroit had us in their grubby palms, and consumers were left with a choice between a few models and a few colors.

This daddy complex/arrogance led them to believe they could do no wrong. It took Ralph Nader and hundreds of thousands of his followers before they would even think of doing anything regarding safety in cars. They fought tooth and nail against every safety feature on cars…against any anti-pollution standards…against anything remotely environmentally sound or consumer safe.

Then they found the SUV goldmine and if the oil prices hadn’t stalled that huge money-maker, it was only a matter of time until there would have been an SUV large enough to park a Hummer in the glove compartment.

In the meantime, other countries looked towards overcrowded roads and cities and smog and price and came up with some pretty amazing automobiles that cost less, look better, run on less gas and last longer…all things that Detroit considered financial folly.

So - after decades of greed and indifference to the realities of the world, excuse me if I don’t shed any tears on the results of their mis-management.

20

I don’t think there’s a real quality difference between domestic and foreign cars at this point in time, actually. I work for a company that makes petroleum additives (engine oil, transmission fluids, gas additives), so we work pretty closely with the major automakers, and what we see of their engines, at least, are all pretty comparable at equivalent price-points.

Right now, I think the US automakers are suffering for their short-sighted decision to place all their eggs in the SUV/minivan market. This was a market doomed to collapse from what the automakers well knew of oil and gas trends. However, the still opted for the quick buck, and so I’m less than sympathetic to how they’re suffering from this now.

In the long term, the cost structure of the US automakers is simply wretched. Not only costs of union labor and healthcare, but in nearly every other fascet of their business. They’re used to spending, not to controlling costs. And the union laborers are used to salaries that are far out of line with jobs of equivalent training and education in any other industry (or country).

I personally don’t believe that GM would be financially viable if they hadn’t had their GM Financing profits. If they can’t make money at their own business, I’m not sure they should be in that business. Of course, I hope they do continue, because the loss of Ford, for example, would have a major impact on my own job.