Detroit has run out of road. The car's future lies in Europe (Hurl-o-matic)

The London Guardian ^ | December 7, 2008 | Will Hutton

[RoadTest]

“The car’s future lies in Europe (Hurl-o-matic)”

In Europe recently, we choked on diesel exhaust outdoors and cigarette smoke indoors. They seem to be candidates for lung disease over there.

European cars are small, that’s all. So are some of their city streets.

[kempo]

I can live just fine on $70 a barrel.

[truthguy]

My worry is the GM management’s willpower — Ford’s management has demonstrated that they want to change and turn-around their company. however, I haven’t seen such commitment from GM’s management

What would it take for you to see the commitment you refer to? If GM spending billions on the Volt and the other extended electric hybrids isn't commitment, what would be? Yes we all know about the UAW problem and that is the PROBLEM. If not for UAW, the auto companies would be in at least decent shape. How is Ford managing the UAW problem better than GM? How have they demonstrated they want change more than GM? I really don't understand.

[truthguy]

Detroit has resisted every regulatory measure aimed at making more energy-efficient cars for decades, but it was particularly successful during the Bush administration. It avoided introducing the fuel-efficient cars the big three manufacture in more tightly regulated Europe, opting for high-margin gas guzzlers for the US domestic market. Now it is paying a fearful price he's right on that count

No he isn't right. You need to learn about the way CAFE operates. CAFE is an acronym for Corporate Average Fuel Economy. This means each corporation must meet the requirement across the board will ALL the Vehicles. The key words are average and corporate. Now a company like Honda which makes only small cars or mostly small cars can easily meet the CAFE standards. But the US car companies sell more large cars, trucks, and SUV's. Why? Because they can actually make a profit on these vehicles. It's nearly impossible to make a profit on a small car in the US given the cost structure the US manufacturers have to work with. When you compare apples to apples, the US manufacturers do just as well on fuel economy as the imports. The US manufacturers resisted the CAFE and wanted a different formula to go by. It's not as simple as what this author has made it out to be.

[Cronos]

Thanks — I guess that’s what affect teh big German autowerks too.

[Cronos]

Not with regards to the UAW problem — I’m talking about the choice of cars, the range, narrowign the number of brands etc. — I see Ford doing more on that as well as on improving it’s profitability and efficiency as a company. I’ve also been returning to Ford cars (including the Ka) and they are goooood. GM, on the other hand — all I see them doing is keep makign the same silly mistakes over and over again

[Cronos]

Mind if I ask you what car you drive? Or, perhaps, you are like some good folks I know who commute on most days by motorbike/small car / bicycle and, during winter by their truck —> a sensible use of resources and one which, when we drill ANWAR, will ensure gas for Americans for generations. Good on you, citizen.

[truthguy]

Chevy Malibu- MT car of the year
Cadillac CTS
Corvette
Buick Enclave
Can Ford match this?

[Cronos]

Perhaps not — you’re right. how about improving their profitability — Ford was showing significant gains until this downturn while GM was and is basically doing the same mistake over and over again

[kempo]

Harley Davidson Electraglide.

[gogeo]

He’s got an agenda. Like many with an agenda, his beliefs shape his facts, rather than the other way around.

[gogeo]

The only solution I can see is for companies that are forced to ask the government for assistance, to be required to take a percentage (TBD) hit across the board for all employees...

Alan Mulally was asked during the hearings if he would agree that all executive employees should take an across-the-board cut in pay. He replied that they needed to be able to hire the best employees, and they cost more.

The problem isn't white collar pay...pay there is based upon the market. No, there's too much "magic" thinking.

The Feds think they can get the auto industry the EU has, without $6/gal gasoline; management has believed for many years that they were entitled to market share; and the unions have pi$$ed in the well for the last 50 years, and are now complaining the coffee tastes funny.

You can't employ unskilled labor at a cost of $72/hr, when your competitors are at ~$43/hr. You can't buy out unneeded employees at $135K each when cash is short; and you cannot run the business when the national contract is thicker than the phone book.

It's not surprising the auto companies are having financial difficulties; it's amazing they've made it this long.

It appears that Management at Ford and GM have seen the light. Chrysler, who knows?

Listening to Gettlefinger during last week's hearings, it's apparent he doesn't get it; listening to congresscritters, it's apparent they don't, either.

[Cronos]

ah, a fellow biker — there IS no better way to travel :)

[NJJ]

I worked there from 1954 through 1963. Those were the good old days. I wish I could have listened to more of the hearings. News clips don't tell enough. I agree these are tough times and there are no easy answers.

I talk to retired friends in Detroit and they all feel they have been making good progress in retooling a new product line to meet energy demands. The collapse of the credit market is what has brought them to this brink.

The irony is that Congress and it's lack of oversight is what made the economy unstable and $4/gallon gas (in a recession) is what tipped it over. Now Obama is backing off on offshore drilling and Congress wants to manage the auto industry! Good luck - we all need it.

[gogeo]

They’re caught in the wake of the perfect storm.