TrainTrac
Well-Known Member
This first OpEd is from the USA Today editorial board:
And now for the "Jane, you ignorant slut" counterpoint:
Our view on domestic automakers: Big Three’s woes extend beyond high labor costs
Chrysler deal reveals extent of distress, need to innovate.
The sale of an iconic brand such as Chrysler is an attention-grabbing event, especially when its
German parent in effect paid $650 million to unload it after paying $36 billion to buy it nine years earlier.
This less-than-zero valuation illustrates the deep trouble Chrysler is in as the result of high labor costs and mounting liabilities, particularly to cover rising health care costs. For Chrysler's new owners, the private equity firm Cerberus Capital Management, negotiating those costs down inevitably is job one.
But another recent headline underscores what might be jobs two and three — innovation and investment — not just for Chrysler but also for General Motors and Ford.
The news was that Honda plans to market, in 2008, the first hydrogen fuel-cell car. Honda's announcement is particularly telling because history is repeating itself. Japanese companies were first to market gas-electric hybrids, and Toyota has become the world leader in this growing field. This happened despite two U.S. taxpayer-funded research programs, the Partnership for a New Generation of Vehicles, in the 1990s, and President Bush's Hydrogen Fuel Initiative, each of which pumped more than $1 billion into research.
This didn't happen because Detroit's labor costs are high. It happened because the Japanese carmakers take a long-view approach and are willing to nurture cutting-edge products.
Of the Big Three, many analysts view GM as the closest competitor to the foreign transplants, both in current products and what it is planning. But GM, Ford and Chrysler will never truly catch up until they invest as much in research and development as their rivals, learn how to anticipate consumer demand, and nimbly execute a long-term plan. Among their problems:
*Mileage myopia. In an era of $3-a-gallon gasoline, the Big Three are stuck with too many gas guzzlers. Even after two years of price swings, they have not moved aggressively to make fuel economy a winning issue, as they did with air bags a generation ago. A version of the Ford Escape is the only American hybrid with any significant market share.
*Stop-and-go planning. Detroit churns through models while the Japanese companies keep improving old names such as the Camry and Accord. The Ford Taurus could be the ultimate example. Once the best-selling car in America, Ford starved it of resources and then pulled the plug. Now its new CEO has dusted off the old name and slapped it on the struggling Ford 500.
Too many models, too little identity. Detroit's brands stand for a dizzying array of products, from compact cars to massive SUVs of varying quality and appeal, some targeted heavily toward the rental market. Then they wonder why they can't establish brand loyalty for either makes or models.
Detroit has, to be sure, made impressive strides in closing the quality gap with foreign companies. And given recent statements by the UAW at all three companies, it is clear that both management and labor realize the seriousness of their situation.
But that's not enough. The Big Three need more cars that excite people. And they need to be viewed as equal or better in quality. That, not just cutting labor costs, will ensure their survival.
Source: http://blogs.usatoday.com/oped/2007/05/big_threes_woes.html
And now for the "Jane, you ignorant slut" counterpoint:
Opposing view: Detroit performs admirably
Big Three build excellent vehicles, but labor costs drag them down.
By David Cole and Sean McAlinden
Many believe that the traditional automotive Big Three simply
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