GM Govt. Bailout?

[Thirty-Nine]

I have nothing against American cars by any means. I KNOW America can build a decent car, but I think old-school thinking and poor management are contributing factors as to the poor choices that the Big Three have made as far as car production goes.

As far as bail out, I'm afraid that not bailing them out will be worse than bailing them out. I lost my job last week, and I was in the auto industry (I worked for a supplier of Ford among other aftermarket parts). If it's bad now, a collapse of the Big Three would (could) be catastrophic.

[GeneW]

Originally Posted by Thirty-Nine

I have nothing against American cars by any means. I KNOW America can build a decent car, but I think old-school thinking and poor management are contributing factors as to the poor choices that the Big Three have made as far as car production goes.

We always were a bit childish in America. Too trusting, too naive and too self absorbed. Guys like Henry Ford made a mint off of us. So did William Crapo Durant, the founder of GM. Ford once sent agents to go to junk yards and discover parts that were "too good". When he found out that Kingpins (a predecessor of the ball joint) on Ford cars were not wearing out he had them "cheapened up".

In my opinion Detroit started to accelerate down the bad path after the Tax Reform Act of 1986. The interest income deduction for car loans was repealed. For some it now made more seen to lease a car than to buy one.

Management, being opportunistic, decided to re-frame an Automobile from being a physical good to being a service. This encouraged more people to lease rather than purchase. Images of the Lease "experience" was what got advertised rather than this expensive, durable and concrete thing known as an automobile. Blonde girls with big boobs instead of technology and resale value, excitement instead of thrift and you can get a better one tomorrow.

Detroit engineered cars to be tougher for the average Mechanic to work on so that the Dealers would get the Lion's share of service. They first wanted them to be easier to make but they also made them so that mechanics would need special tools to do the work economically. They put easily worn out and broken shit in bizarre places.

Lesees would take the Company's car to the garage for its mandatory service, pay for the car by the mile, and once the term was up they'd lease another newer car. The Company took care of you, for a hefty fee.

If the car was a piece of crap you'd lease a newer one. If it was really bad the Dealer would replace it, sorta.

There was also this idiotic thing called "Planned Obsolescence". The Product was built to slowly disintegrate so that you'd HAVE to buy a new one. This concept is so against the idea of the Customer being in the driver's seat that it's not funny. Ford and his kingpins became the whole damn thing nickel and dimeing you at 200,000 miles so you had to buy another car - or if you leased you never saw this horror show.

The Japanese and Koreans kept to the old model. A car was an expensive purchase. You bought and kept it. So it had to be of good quality and the better the quality the more customer satisfaction that came from it. Japan was selling to the world and most of the world is too poor to buy cheap goods. Japanese were very poor after the war ended and understood how hard it was to earn enough to buy a car. So did the Koreans. When Japanese got rich they remembered the climb up and how it felt to buy good products that honored their hard work.

American manufacturers were selling to Americans, who were wealthy and did not have to be shrewd and careful with their money. We haven't seen hard times since the Great Depression and haven't had a war here since 1865. We've had it very easy and the world is an easy place.

There was no tomorrow, only today and it's all new and shiny.

Tomorrow finally came.

I know that there are other causes and reasons but these are what come to me right now.

Originally Posted by Thirty-Nine

As far as bail out, I'm afraid that not bailing them out will be worse than bailing them out. I lost my job last week, and I was in the auto industry (I worked for a supplier of Ford among other aftermarket parts). If it's bad now, a collapse of the Big Three would (could) be catastrophic.

Sorry to hear that you were laid off. Keep busy and don't treat this as a vacation. I did back in the early 1990s and regret doing so to this day.

I was laid off in 2006. I had a new job two months later. I don't live in a wealthy part of the US, I'm over forty and I have a pretty diverse job history. So this was pretty damn quick. Motivation and a desire not to repeat the mistakes of the past where what drove me.

Good luck to you.

Gene