Posted on 11/27/2005 10:50:14 PM PST by truth_seeker
....General Motors announced last week that it was shuttering a dozen North American manufacturing, assembly and stamping plants and eliminating about 30,000 jobs.
"But analysts immediately questioned whether the plan was enough, saying it lacked the speed and breadth that had helped rivals make comebacks," reported a front-page New York Times article, which later raised the specter of bankruptcy for what is still the world's largest car company.
Although not for long. Toyota, newspapers report, is poised to take that honor early next year.
GM, which in the 1960s made more than one of every two cars sold in the United States, now has market share of only one in four....
(Excerpt) Read more at ocregister.com ...
When times were good GM aceeded to every union demand for more pension and health benefits. Now the company faces over a billion dollars for outstanding health benefits alone. What isn't realized is that the workers for auto manufacturers headquartered in Japan have all their healthcare benefits provided by the government. Aside from some marketing errors made by GM this represents a huge liability for U.S. domestic manufacturers.
Retirement age needs to be increased...back then people died soon after retirement, not anymore where they rake in also empty health care. This is not how it were computed.
Incorrect. The American workers for Asian manufacturers have their healthcosts paid by their employer, not by their employer's government.
"Aside from some marketing errors made by GM this represents a huge liability for U.S. domestic manufacturers."
I'm one observer that believes "some marketing errors" is the true crux of the matter.
GM's falling market share is not tied to retirees' benefit costs; it is caused by consumers rejecting the products.
They have fared well with their "light truck" line; pickups and suvs.
They have:
--Continued with outdated pushrod motors, some decades old.
--Stopped their Camaro/Firebird line with NO replacements. (Meanwhile Ford's completely new Mustang sells very well, proving there IS a market; another market GM walked away from)
--Continued the Aztec, long after it was an industry laughing stock.
--Named a new Buick "Lucerne" instead of Roadmaster, or an other American car name.
--Continued a belief that by "badging" they fool buyers into thinking they make a wide selection of vehicles.
--Failed to have a real hybrid.
--Failed to introduce new rear wheel drive sedans.
--Failed to build old fashioned station wagons; which will increase in sales, due to downsizing from suvs.
--Backed away from ties to Subaru, an excellent company.
--Wasted billions with Fiat, a crappy company.
--Tried to foist an import from Australia as a GTO.
--Failed to introduce "youthful" vehicles, as can be seen by Toyota, Honda, VW, Subaru, Mitsubishi, Ford, etc.*
* Just as they failed to compete for the higher priced BMW-MB-Audi-Lexus-Infinity market, they now fail to compete with the youngest buyers.
These young buyers go for the makers' mentioned, such as Scion, Honda, VW, Suraru, etc. Small functional "different" styles, and high performance small cars.
In fairness, their all new Cadillac line include good cars. Mainly designed in Europe.
I contend that GM's Detroit design/engineering has otherwise died on the vine.
I think they should fire all top management, and a majority of the board of directors. They have been so afraid of risks, that they remained flatfooted, way too much, way too long.
I like my present GM car: A Swedish designed and built Saab, a company bought by GM which I fear they are in the process of misusing, before they screw it up.
If your SAAB is of recent vintage, it's actually a German design, not Swedish.
Most of the platforms that Cadillac is using are European. The STS and CTS are on an Opel platform, the SRX is on another Opel platform, the XLR is a Corvette, and the DTS (lumbering FWD barge with diminishing sales) is on a domestic FWD chassis, and it *shows*.
Some corrections, or comments, too -
1. That "import" GTO is probably the best Pontiac *ever*. GM needs to fire their Pontiac, Chevrolet, and Buick designers and put the Aussie designers of the GTO/Holden Monaro in charge. Best interior ever put in a US-market GM, best handling in a non-Vette/non-Caddy (have to allow for the STS/CTS) US-market GM.
2. It's not their "badging" that's necessarily a problem, it's their horrible platform engineering that is. Their idea of platform engineering for US platforms is to make one chassis that's generally acceptable in terms of sizing specs, and then slap slightly different versions of sheetmetal on the outside to make the different models. Meanwhile, Nissan made one bad-@$$ platform, the FM, for the Nissan 350Z, and then made a BUNCH of different, excellent cars off that platform, some that handle and ride better than their BMW competitors! And it's almost impossible to tell that they're all the same chassis! (For the record, in the US the cars on that FM platform are the 350Z, the Infiniti FX35, FX45, G35, G35 Coupe, M35, and M45. Overseas, the Nissan Skyline V35 is also on the FM chassis.)
3. The failure to introduce new quality non-Cadillac RWD sedans is a complete mystery, especially since (if they wanted to) they could have some kick-@$$ rear wheel drive cars here in a year, courtesy of their Australian and European divisions.
4. Those "Youthful" Toyotas, aka Scions, as it turns out, are not being bought by the youth. They're being bought by soccer moms and the over-40 set.
Have you considered the possibility that the GM design/engineering work has already been outsourced to India? A fair bit of Ford's design/engineering staff has already been moved there. I've worked on projects tied to engineering organizations at both companies. Some of the offices don't exist anymore.
"If your SAAB is of recent vintage, it's actually a German design, not Swedish."
Mine is a 2000 9-5, which I think was Swedish.
The newer 9-3s I believe share a chassis with Opel, and is probably what you are thinking.
This chassis is used for the Chevy Malibu Maxx (funny looking wagon-like rear end). Probably a fairly good car.
But for the US they keep using outdated motors. Meanwhile Saabs have excellent turbos.
An interesting new car is the 9-3 Sport Combi; small station wagon with two high performance engines--gobs of low rpm turbo power.
Why can't they simply build these motors for the US vehicles? They now own 100% of Saab.
Thanks for the details.
I agree that the GTO is an excellent vehicle. It is lamentable GM couldn't equal it at home. It is just doesn't have stand-out good looks (which I know is subjective).
After spending the bucks to engineer the excellent rear wheel drive Cadillac chassis, why not use them for selected other vehicles? An Pontiac, etc.
Mercedes' previous "E series" is the basis for Chrysler-Dodge cars; Chrysler 300 and Dodge Magnum. Slap American style sheetmetal on a first rate chassis, and give it real power.
GM simply stands almost dead in their tracks, while the competition builds and SELLS Chrysler 300s and Ford Mustangs.
I agree with your comments on Nissan.
In my area, the kids get Honda Civic 2 door coupes, Subaru WRI/STX, etc. and hot-rod with them.
If I had a contribution, it would be a mid-sized Chevy Nomad wagon built on a Cadillac chassis. Two and four door versions, V6 and V8 power, and AWD option. Sunroof, leather, Nav, Satellite, touch-shift A/T.
If it had retro-classic styling, it would sell big, the world-over.
I have heard several comments about RWD - why is it so much better than FWD?
I don't know much about the two.
A well run company will do what is obviously correct.
A great example of this committee stuff is General Motors. I am sure you have seen the Aztec vehicle. When it came out it was the most ugly vehicle I had ever seen. The problem is NOT the Aztec, but the fact the product actually GOT TO MARKET!!! Anyone with a brain could see instant failure. I certainly did! Thankfully, the market also agrees with me, even if people don’t!!!
Of course the market studies right now show that the Aztec has the highest customer satisfaction of any GM vehicle sold. I would think it has to have the highest customer satisfaction if you did actually get a customer to buy one! It would really have to be blind love!
Of course now the problem is not that the vehicle is so ugly, but the fact that they only sold 10,000 units. GM is now desperately trying to figure out what to do with this flop.
GM workers in Canada also have government health care, so why did GM shut down that plant? It is also one of the 2 most modern GM plants in North America as well. If health benifits were a big factor to GM, it doesn't make sense that that plant closes, plus labor costs are a bit cheaper too, as well as steel. I think politics plays a big role, not just health benifits. How many off shore plants has GM closed?
Japanese auto companies are subsidized by their home countries. Japan has block access to their markets for years.
I had the exact same reaction to the Aztec - couldn't believe such an ugly car made it to market.
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