The Quagmire Ahead (GM)

New York Times ^ | June 1, 2009 | David Brooks

[reaganaut1]

...

G.M.’s core problem is its corporate and workplace culture — the unquantifiable but essential attitudes, mind-sets and relationship patterns that are passed down, year after year.

Over the last five decades, this company has progressively lost touch with car buyers, especially the educated car buyers who flock to European and Japanese brands. Over five decades, this company has tolerated labor practices that seem insane to outsiders. Over these decades, it has tolerated bureaucratic structures that repel top talent. [...]

As a result, G.M. has steadily lost U.S. market share, from 54 to 19 percent. Consumer Reports now recommends 70 percent of Ford’s vehicles, but only 19 percent of G.M.’s.

[...]

The Obama plan won’t revolutionize G.M.’s corporate culture. It could make things worse.

First, the Obama plan will reduce the influence of commercial outsiders. [...]

Second, the Obama plan entrenches the ancien régime. The old C.E.O. is gone, but he’s been replaced by a veteran insider and similar executive coterie. Meanwhile, the U.A.W. has been given a bigger leadership role. This is the union that fought for job banks, where employees get paid for doing nothing. This is the organization that championed retirement with full benefits at around age 50. [...]

Third, the Obama approach reduces the fear that impels change. The U.S. government will own most of G.M. It would be politically suicidal for the Democrats, or whoever is in power, to pull the plug on the company — now or ever. [...]

Fourth, the Obama plan dilutes the company’s focus. Instead of thinking obsessively about profitability and quality, G.M. will also have to meet the administration’s environmental goals. There is no evidence G.M. is good at building the sort of small cars the administration demands. [...]

[reaganaut1]

Sometimes David Brooks writes a good column. I disagree that it would be "politically suicidal" for the Republicans to allow a real GM bankruptcy if they ever return to power. A recent Rasmussen poll found Just 21% Favor GM Bailout Plan, 67% Oppose .

[wastoute]

I love the phrases that are being used in all this. Last night I heard a TV journalist ask for an "exit strategy" and others are saying Zero is entering a "quagmire". LOL. It must really sting to be rebuked with this kind of irony.

Μολὼν λάβε

[GQuagmire]

Heh,heh..........quagmire

[SatinDoll]

I like automobiles, especially sport cars. Was very excited at the prospect of the Camaro coming back on the market, but then the specs came out - NO leather seats! - and really sucky colors.

You can’t give me a Corvette - don’t like them at all. Muscle cars from the 1960s I like and once had a ‘70 Mustang Grande that was super until my sister rolled it.

Speaking of Mustangs, well I used to have a 1966 Mustang but it is really lousy on snow and ice, whereas my Datsun 240Z (1972) was a real cat with claws on snow and ice.

Will probably settle for the BMW roadster in the next year and a Cadillac Escalade this fall.

[freekitty]

I imagine there are a number of reasons GM lost its footing. Mainly crooked bosses and crooked politicians. Instead of building cars people want; they pretended to concentrate on safety which is anything but true and more environmentally functioning cars. Example going from V8 to V6 to even V4. Everyone knows V8 is the best engine out of the 3. Btw, the first time I got into a V6 which I still don't own, I almost got killed trying to get on the freeway. It should be interesting to watch Government Motors shoot dead the car industry with its no style surely tin can real death traps they now plan to build.

[lynn4303]

I have a couple of questions that I have not seen answers for yet:
1) With the UAW being stakeholders in GM, and GM being propped up with tax dollars, with more sure to come, are they going to be allowed to donate millions, as in the past, to the democrat coffers? Would not they be using our tax dollars to make donations to certain political interests? Is this all possibly just a tax dollar money laundering scheme that can go on forever?

2) With the UAW owning GM, but representing autoworkers for Ford and Chrysler, would it not be in their best interest to not bargain in good faith with Ford and Chrysler. They should have no interest in reaching any labor agreement unless it does major harm to Ford and Chrysler (the competition. With this arrangement can they truly represent the best interest of union workers for Ford and Chrysler? Situation: Ford has tremendous success and is stealing market from GM. Wouldn't the UAW have interest in stopping that due to their financial interest in GM?

I really am looking for clarification as I see no way for this arrangement to be fair or to work.

[wny]

Then there's the quality thing. My wife and I have owned a:

Chevy Chevette (purchased new)

Chevy Nova

Chevy Malibu

Olds Cutlass Supreme (purchased new)

Buick Regal (purchased from relative who bought it new)

Mercury Sable (purchased from relative who bought it new)

Mercury Sable wagon

Saturn SL2 (purchased new)

None of these got anywhere near 100,000 miles without requiring expensive non-routine repairs and/or being in the shop repeatedly for some recurring problem.

I bought a Toyota Corolla wagon with 30,000 miles on it. I put 110,000 more on it. It never required anything but routine maintenance.

Three years ago this month I bought a 2006 Toyota Camry with 14,000 miles on it. I'm pushing 95,000 miles now. It's needed nothing but tires, windshield wipers, a tail-light bulb, gas and oil.

I've bought my last American car.

[saganite]

I bought a ‘66 Mustang 2 years ago and keep it in the garage until the weather is nice. No snow or ice, ever. I love getting under the hood and turning a wrench without wondering if I’m wrecking the electronics or the computer.

[SkyPilot]

Boycott Government Motors.

Anyone who buys their garbage deserves all the misery they will suffer.

Their trade-ins are going to fetch a few cents on the dollar of blue book value - and good luck with warranty items. Oh, and parts will be enormously expensive.

But hey - you are helping to fund the health care and pension of some union slob.

[LZ_Bayonet]

"2) With the UAW owning GM, but representing autoworkers for Ford and Chrysler, would it not be in their best interest to not bargain in good faith with Ford and Chrysler. They should have no interest in reaching any labor agreement unless it does major harm to Ford and Chrysler (the competition. With this arrangement can they truly represent the best interest of union workers for Ford and Chrysler? Situation: Ford has tremendous success and is stealing market from GM. Wouldn't the UAW have interest in stopping that due to their financial interest in GM?"

Excellent question!! I have not heard this one asked by any media.

[Fred911]

F the UAW

[seatrout]

—Everyone knows V8 is the best engine out of the 3. —

The 3.8L V6 wasn’t a bad engine (though old fashioned), but back in the 90s some engineering genius (GM designers share some blame along with managment and union goons) put PLASTIC intake manifolds on them. Sure enough, these all melted sooner or later, causing big problems when coolant mixed with oil and/or fuel. As for 4 cylinders; GM historically has never built a really good 4 cyl. engine. Toyota and Honda, on the other hand, have been building great 4 cylinders for years.

[IamConservative]

Looking back, you have to wonder why anyone in their right mind (GM Management) would agree to contract terms like the job banks and lifetime healthcare. GM is/was the second largest health insurance provider in the country. Very strange business for someone that makes cars to be in.

I’ve driven GM all my life. I’ve now got Toyota cars and will give Ford an opportunity at my business when I need to replace my pickup. Hopefully, when that time comes, Ford will have a 1/2 ton offering with a diesel engine.

[ninonitti]

Maybe they could make vehices for the Post Office....and accept payment in Forever Stamps

[Paladin2]

"Maybe they could make vehices for the Post Office"

GM have been building the chassis for postal vehicles for decades using S10 parts.

[Hardastarboard]

Mercury Sable (purchased from relative who bought it new)

Mercury Sable wagon

I spotted two of your problems right there. The Sable was an expensive Taurus, which, while it was a good design, had tremendous quality issues. I owned a couple (never again). All the rest of Ford's line up (at least currently) consists of very well made, reliable cars (not technology leaders, but reliable).

I have long contended that after the debacle of the 70's that all the American auto makers participated in, Ford finally got it right, with everything EXCEPT their best selling car. The Taurus was the rotten apple in the barrel that spoiled it for all the others. If it hadn't been for the quality problems the Taurus had, Ford would have a great reputation for quality. They did it to themselves, with that one lousy car.

[Paladin2]

[Paladin2]

http://en.wikipedia.org/wiki/Grumman_LLV

[RoadTest]

“Hopefully, when that time comes, Ford will have a 1/2 ton offering with a diesel engine.”

Why?

[freekitty]

I will concede points to you since you seem to know about car engines; but I will stick with the V8. :)