Posted on 11/15/2008 11:48:41 AM PST by NewJerseyJoe
Given the abysmal performance by Detroit's Big Three, it would be better to send each employee a check than to waste it on a bailout, says David Yermack
Before Michael Moore became famous for documentaries like "Fahrenheit 9/11" and "Sicko," his first big success came in 1989 with "Roger and Me." In that film, Mr. Moore followed General Motors chairman and chief executive Roger Smith with a camera crew, asking him why the company was closing plants and producing low-quality vehicles. Mr. Smith looked flustered and inartfully avoided Mr. Moore's camera crew while it lingered outside his country club or GM's executive offices.
"Roger and Me" was entertaining, but it missed the real story about Roger Smith, who turned out to be a forward-thinking genius. Mr. Smith made big investments in information technology and satellite communications, acquiring Electronic Data Systems in 1984 for $2.5 billion and Hughes Aircraft in 1985 for $5.2 billion. Mr. Smith's successors divested those businesses at huge profits -- EDS was taken public in 1996 for more than $27 billion, and Hughes, renamed DirecTV, went public in 2003 for more than $23 billion. (The man who sold EDS to Roger Smith at a bargain price was H. Ross Perot, who then convinced many people that the experience qualified him to be president.)
Mr. Smith understood all too well that GM shouldn't continue investing in its failing automobile business. That was 25 years ago.
(Excerpt) Read more at online.wsj.com ...
Nice rant, but I will never again buy a UAW product.
That Union's management itself seems to recognize that there is no future in actually producing anything by union members.
They have spent a lot of time and likely a lot of Union dues money recruiting Craps dealers in Connecticut.
Crap cars and Craps dealers. That is the new UAW!
Yet the msrp is still 3k more than a Honda accord for base models..... Even if there was any logic to that I’d still have major problems with spending that much money on something which could be totally outmoded three years down the road at this point.
I am hardly the only one who thinks this way, truthguy. People have been saying this for years. Was just chatting with a good friend who again reminded me that they have not bought an American-made car in over 25 years. I know many people like this. Most of the people I know who talk this way are liberal Democrats too. The only way “change” in all this is going to happen is if we stop buying Big Three.
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Your post mentions an awful lot of things that “we” need to do, but no indication of how “we” are going to get those things to happen.
U.S.News & World Report
10 Cars That Sank Detroit
Friday November 14, 5:34 pm ET
By Rick Newman
The global financial crisis is suffocating the Detroit automakers, but the problems at General Motors, Ford, and Chrysler have been festering for years—even when the mighty “Big Three” were earning billions. Aging factories, inflexible unions, arrogant executives and shoddy quality have all damaged Detroit. Now, with panicky consumers fleeing showrooms, catastrophe looms: Without a dubious federal bailout, all three automakers face the prospect of bankruptcy.
There will be plenty of business-school case studies analyzing all the automakers’ wrong turns. But, as they say in the industry, it all comes down to product. So here are 10 cars that help explain the demise of Detroit:
Excerpt: Go to the link below for the story:
http://biz.yahoo.com/usnews/081114/14_10_cars_that_sank_detroit.html?.&.pf=insurance
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