According to
this article, Toyota is poised to become the number one auto maker in the world, surpassing that old dinosaur General Motors. I think the reasons for this are many:
- American auto makers have been strapped with unreasonable labor unions who demand high wages and even more insane benefit packages for their employees. The cost of these wages and benefits often out weigh the actual value of the work these people do. In the end, this bloats costs, which moves money out of investment for future growth.
- American auto makers are also strapped with insane pension payouts to former workers. This has the same crippling effect as the bloated wages and benefits.
- American auto makers are completely unresponsive (at best) to changing trends. Just look at the Honda and Toyota responding to the market with their hybrid cars. Where is GM and Ford? They have a few offerings, but are certainly not in the forefront on this innovation. They would rather just keep building trucks and SUVs.
- American auto makers have no sense of style, taste, or quality. They used to, but they have since lost it. Today, American cars tend to be ugly, inside and out, and often lack any sort of ergonomic design.
- Supply chain issues, see comments. Richman brings up a good point about the supply chains. It is probably not as bad of an issue as the unions that are strangling all industries, but it is still an important issue, so I add it here.
If American auto makers want to stay competitive, it seems that they need to do a few basic things:
- Reduce labor costs, including wages, benefits, and pension payouts.
- Invest in new technologies so they are leading development instead of following.
- actually pay attention to the market.
- Stop designing ugly, cookie cutter cars that completely lack class and personality.
- Focus on quality.
If they do all of that, then they might regain the number one spot. Otherwise, welcome Toyota to number 1, and it will only be a matter of time before GM loses the number 2 spot...
6 comments:
Your overemphasis on unions as the cause has caused you to miss an equally important cause of their market dominance. That is that their supply chain is far leaner, and far tighter than the supply chains used by GM and the other U.S. automakers. Commonality of parts means spending much less on design and manufacture as well. Additionally, their approach to their suppliers is far more cooperative than the dictitorial relationships that automakers like GM have. The result of that practice is much longer term relationships within their supply chain. And say what you will about the unions, but it takes two parties to make a contract. The automakers have no one else to blame than themselves. What the unions do need to do is to look at what roles they will play in the future of the industry in this country and adapt accordingly.
Your comments on design and ergonomics fall far short. I don't find Toyota's vehicles to be any more aesthetically pleasing than any other make. And to say they are cookie cutter in approach is to ignore the complete redesigns undertaken by Chevrolet and Cadillac in their lines over the last 10 years, just to name two.
Richman
The unions are strangling many industries with their rediculous demands, plain and simple. The auto industry is just one of the more obvious industries where this is occuring, but you could also point to the airline industry and a whole host of other industries where the workers generally are over paid and have insane pension plans.
As for the ergonomics and design, the last time I went car shopping (a couple of years ago), the quality of design both inside and outside was night and day different between the Ford / GM cars and the Toyotas and Hondas. Far better interior layouts in the Japanese cars. Even in the GM lines (Pontiac), there was a marked difference in the plain GM crap and the one cars (the Vibe) that Pontiac teamed up with Toyota on. The Vibe was far better quality, more comfortabble, and had a far better design than the other Pontiac junk (even if you went to a more expensive Pontiac).
I'll give you that Cadillac are not cookie cutter (Chevy pretty much are though). However, the Cadillac redisigns have all be in the wrong direction, away from somewhat classy looking cars to stuff that is just plain butt ugly.
About the only American car company with any class and style to their cars is Lincoln. Chrysler has some to, at least in their higher end models.
Eddie - glad to hear you had a nice lunch. My wife and I went to a Wave game at the Cell and had lunch at Turner Hall. It was a fun game and a great lunch.
Now that their designs are just as plain and vanilla as the Jap automakers
Actually, I would argue that they have gotten worse. What few American cars have a distinctive look anymore have a distinctively ugly look, while many of the Toyota and Honda cars have gained a classier look over the years (granted, they started out butt-ugly, so could only go up).
You are spot on with the quality issue. If all else were equal (which it is not, but if it were...), the Japanese auto makers would still have a huge advantage on that alone.
The only reason why people even continued to buy GM's and Ford's was because their designs "looked" better.
That, and never discount the idiots who just "buy American" because they are sucked in by stupid, meaningless slogans... :)
Don't get me wrong on unions, they outlived their usefulness many years ago. But I reiterate, it took a business decision to give them what they received.
And all this talk about American v. Japanese design is all moot. Everybody knows European auto design beats them all.
Everybody knows European auto design beats them all
I'll agree with that! At least with the aesthetic design of the cars. BMW seems to have taken a wrong turn (with the notable exception of the MINI), but most of the rest are still producing wonderful looking cars.
Now if they could just get the quality up to match that of the Asian cars.
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