Ford Loses # 2 U.S. Automaker Slot

I say, let them go into bankruptcy, reorganize. Bankruptcy would also let them renegotiate their Union Contracts.

Too bad the top 3 horse and Buggy makers were allowed to fail. I mean; think of all those who lost their jobs and you know the buggy whip makers had to lay off some workers.... And the horse post makers lost their shirts....
If only we used tax money to keep them employed.... We may be looking at buying a family stagecoach rather than a family SUV.

I have all kinds of cars and SUV's over the years, but im most impressed with my current SUV. a nissan xterra, this truck is a beast i feel like i could drive through a lake and come out dry,its practical ,good on gas , at least for me and it is very spacious inside.thats my opinion.

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I enjoyed reading this thread along with the spot-on replies. I know all of you will find this difficult to believe, but some people call me long winded. Sometimes I am, but sometimes it's necessary.
So, you've been warned... this is a tad long.
Some of the biggest managerial bunglers in the history of this nation have lead the American Auto Industry and they're still doing it.

The problems the industry faces has nothing to do with dealership management, their employees, assembly plant managers, or the assembly line workers.

Local dealerships are small business owners who work hard and survive on small margins. The margins keep getting thinner, too.

Most employees are hard working people who simply want to do the job they were hired to do. They follow orders to the best of their abilities.

There is blame for the problems the auto industry faces today, the cause was placed at the root several decades ago by policy mangers--the folks in the executive suite and boardrooms.

There are two basic marketing approaches to production of goods and services that must compete under elastic demand conditions: the customer approach and the product approach.

The latter dictates that management produce a product and sell it--sort of like "if we build it, they will come." The former seeks to test consumer preferences and provide what they demand.

The American Auto executives have always produced according to the product approach. It worked in the beginning decades but it stopped almost three and half decades ago.

It came close to bankrupting Chrysler until Lee Iaccoca turned things around. But, after he left and the company became fat and happy again, they went back to the old way.

These policy managers still do not get it.

In the business world, there is a principle called the Time Span of Discretion. It defines the period between a management decision and the point at which people begin to see the effects of that decision. The lower the management level, the shorter that period.

Assembly line supervisors make decisions that affect the flow and continuity of the line’s final output. Plant management will see the effects of those decisions—good or bad—almost immediately.

The plant manager may make decisions involving methodology for quality inspection and quality control. Management at the divisional or regional level, however, may not see the effects of those decisions for several months, or even a year or so.

On the other hand, policy managers (senior executive council or board of directors) may make decisions the effects of which the stockholders may not see for five, ten, or even fifteen-years.

The shorter the time span of discretion, the easier it is to modify decisions to gain the desired results. In long-term policy decisions, however, the time spans are too long.

By the time people realize the effects—especially the negative ones—it may be too late.

A prime example today is our automobile industry—or the “big three” as we’ve come to call them. Policy decisions they made as far back as a couple of decades have finally shown their effects.

And, they’re not at all positive. All three of them are now begging for a piece of the bailout pie; they want $50-billion to help them through this incredibly difficult period of financial disaster.

They claim they’re going to use it to finance innovation. This is amazing in that policy managers are supposed to be pursuing innovative ways to remain profitable… at all times. The fact is that they have not done so.

Instead, they’ve spent billions over decades on lobbying efforts to protect the status-quo: producing gas-guzzlers, caving to every union demand made, and perks galore for executives.

They’ve steadfastly adhered to the minimum in environmental concerns, leaving their salvation from regulatory mandates to well paid lobbyists. There has been virtually no attempt to adapt to changing environmental, legal, or social conditions.

They made some of these policy decisions going back 40-50 years ago. There has been no forward vision other than fighting regulation through lobbyists.

It’s a classic example of the “time span of discretion” in action. Now they want us to bail them out—no questions asked or qualifying terms set.

We must do something; I’ll concede. I don’t have the full answer. But, common sense tells me it’s going to be painful. However, I do know that giving this kind of dysfunctional policy management billions of dollars to perpetuate the same mistakes is beyond stupid.

Automotive is not the only culprit subject to such ineptness. Bankers are just as bad, only a lot slicker and generous with the K Street lobbyists.


Regards,

Joe Walther

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Joe Walther
http://thetruefacts.blogharbor.com

As I said in my short comment, Unions are killing this industry, as well as CAFE standards (environmentalists are a big part of our problems in this country IMO) and frankly If I was paying these lobbyists I think we would have to re-negotiate our contract. That being said before I would give them money they would have to change some of their business practices.

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The truth will set you free, but first it will piss you off.

The main problem, as I see it, is that the auto industry is slow to change. They are still selling cars the same way they did for years and no one is happy with the process of buying a car. I remember when Saturn first came on the scene and promised that if 10 people came into any dealership and bought the same car, they would all pay the same price and they benefited from that sales strategy but they changed.

Then came the internet and for a while you could buy a car from the maker for 1000's less than you could from a dealer, but the dealers killed it.

If they want to stay in business, and they want our tax money than they need to stop the blame and make changes. Management, union employees, and dealers need to make changes.

If my employer was going under and they asked me to bite the bullet to stay afloat, I would bite the bullet and remain employed.

You are exactly right Max
The unions have been sucking the life out of the big 3 , guess I can't call them that anymore.
If the higher ups at all three companies would trim some of their own salary's and they should have done it years ago when all this started.

My future is looking grim

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Na... you do know that the "higher ups" you are talking about are not union... The "salaried" people are not union people.... they're what we call "white shirts"



Unions gave us the weekends off, and when the weekend was worked, you were paid for that work in OVERTIME, unions gave us the 8 hour workday which works out to be a 40 hour work week, retirement at 30 years, workers compensation, OSHA and lets not forget collective bargaining... Unions also gave the chance for people to actually receive a decent paycheck, and live like you should live.....

people forget and take for granted all the rights the unions bargained for.....

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i totally agree zip, there is a place in the US for unions. I have never been a union worker, but my dad was, and at my old job all our fitters where union (who is worked with daily) and i never thought negatively of unions.

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Philly Sports

well said Scrappy
back in the day there was a need for unions, but not for the past 30 years. Why do you think Toyota could build a better car for less money since the 70's. They never were involved with the unions.

The white shirts are a totally different thing. And I believe before the Government helps out they should have to take a pay cut or they will not get the money. Does the CEO of GM really need 20 mil salary a year?

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