Maybe lousy columns are the reason for the WaPo's troubles
The sage Richard Cohen:
Cohen should just tweet. 140 characters is about the limit of his attention span ("what's a credit-default swap, anyway?"), his arguments, and his readers' patience. After a lot of populist blatherings about torchlight parades and pitch reserved for AIG and GM, he writes that the American car companies build lousy cars.
Which they did. Some time ago. Not long after they'd built some pretty bitchin' ones, but the Reagan years were tough on a lot of things.
My point is, it isn't lousy cars that brought them to this pass. It was big ones. Specifically SUVs and trucks. Which they sold one hell of a lot of just a few years ago, at very handsome profits. But first oil prices went through the roof last summer and then the economy fell through the floor last fall while credit for their finance companies (where the real profits can be found) froze. So they stopped selling the SUVs and the trucks that were subsidizing the fuel efficient vehicles that are way smaller in margin as well as size.
Truth is, bad management decisions such as deciding to go all in on trucks and SUVs, destroying longterm sustainability for the quick rush of big profits ultimately did them in. CAFE "standards" that abetted their dependence on luxury land liners fueled (no pun...) their greed. A dealer system propped up by state governments forces them to keep in place a pre-Internet sales model and an overcapacity of dealerships. And yes, a reputation for building cars that weren't Toyotas or Hondas that they could never overcome, no matter how many JD Powers statues.
Whether GM or Chrysler deserves more government funding is debatable (and you might say that the conditions cited in the previous paragraph indicate that the problem is practically hopeless). But let's at least be honest about what the real reasons are for Detroit's problems these days. It ain't because they're put together by a shitty workforce, as the column implies.
Oh, and by the way, that paragon of automotive quality, Toyota, isn't selling many cars these days either. Because, you may have noticed, Dick, people aren't buying cars right now. The Japanese car companies just happened to be better managed, have fewer legacy costs (retirees, U.S. dealerships, brands), and far better at "rainy day" saving then Detroit, in large part because they don't have to fund health care for their workers. And that -- health care -- may be the biggest problem of all; one being conveniently ignored by pretty much all of the critics of the car makers and the UAW such as Cohen and this lying dweeb.
I need a cigarette.
The auto industry is not only late to the table, it comes with a bad rep. We may not understand what AIG did -- what's a credit-default swap, anyway? -- but we sure as hell know what GM did: It made a lot of lousy cars. So did Ford and Chrysler. They made cars with utter contempt for the customer. The industry at one time even opposed seat belts and air bags, and it designed cars that were not safe. I know things have changed, but I remember. I remember.
Cohen should just tweet. 140 characters is about the limit of his attention span ("what's a credit-default swap, anyway?"), his arguments, and his readers' patience. After a lot of populist blatherings about torchlight parades and pitch reserved for AIG and GM, he writes that the American car companies build lousy cars.
Which they did. Some time ago. Not long after they'd built some pretty bitchin' ones, but the Reagan years were tough on a lot of things.
My point is, it isn't lousy cars that brought them to this pass. It was big ones. Specifically SUVs and trucks. Which they sold one hell of a lot of just a few years ago, at very handsome profits. But first oil prices went through the roof last summer and then the economy fell through the floor last fall while credit for their finance companies (where the real profits can be found) froze. So they stopped selling the SUVs and the trucks that were subsidizing the fuel efficient vehicles that are way smaller in margin as well as size.
Truth is, bad management decisions such as deciding to go all in on trucks and SUVs, destroying longterm sustainability for the quick rush of big profits ultimately did them in. CAFE "standards" that abetted their dependence on luxury land liners fueled (no pun...) their greed. A dealer system propped up by state governments forces them to keep in place a pre-Internet sales model and an overcapacity of dealerships. And yes, a reputation for building cars that weren't Toyotas or Hondas that they could never overcome, no matter how many JD Powers statues.
Whether GM or Chrysler deserves more government funding is debatable (and you might say that the conditions cited in the previous paragraph indicate that the problem is practically hopeless). But let's at least be honest about what the real reasons are for Detroit's problems these days. It ain't because they're put together by a shitty workforce, as the column implies.
Oh, and by the way, that paragon of automotive quality, Toyota, isn't selling many cars these days either. Because, you may have noticed, Dick, people aren't buying cars right now. The Japanese car companies just happened to be better managed, have fewer legacy costs (retirees, U.S. dealerships, brands), and far better at "rainy day" saving then Detroit, in large part because they don't have to fund health care for their workers. And that -- health care -- may be the biggest problem of all; one being conveniently ignored by pretty much all of the critics of the car makers and the UAW such as Cohen and this lying dweeb.
I need a cigarette.
Labels: auto industry follies
posted by John at 4:44 PM
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