Sunday, April 17, 2005

Automotive Apocalypse: the coming crisis

Automotive Apocalypse: the coming crisis
by Devilstower
Sat Apr 16th, 2005 at 07:30:34 PDT
Your Next Car Will Be Chinese. More than that, it'll likely be electric. Okay, maybe not your next car, but we're right on the brink of another major shift in the auto industry. The change is going to come fast. And it's going to hurt.

For forty years, we've watched the slow decline of the American motor vehicle industry. At the start of that period, the Big Three (General Motors, Ford, and Chrysler) held more than 90% of the American market and accounted for major sales in most markets around the world.

That was then. The Big Three (one of which is now more than half foreign owned) account for a slim majority of auto sales. General Motors has seen it's share of the market fall from 65% to 25%. Until recently, that decline has been gradual, but now it's accelerating. The American automobile industry isn't just continuing to shrink, it's on the brink of total collapse, and it threatens to bring the economy, and the nation down with it.

MSNBC puts it in the most emphatic terms possible: GM and Ford are National Security Risks

Why has is the auto industry doing so badly? They'd like to point at the workers. Give GM's Bob Lutz or Ford's Bill Ford a chance, and they'll bemoan the high wages given to American auto workers and the restrictions given by the unions. But that's not the problem.

Management will blame this on intractable labor costs. While labor costs are definitely a problem, it's time to consider a larger problem: intractable bonehead management.
Remember what we've been told about Japanese management style? They seek consensus. They favor conformity over innovation. Japan may be good at mass-production, but they don't really innovate. Well, pardon my French, but Bull and Shit.

The same Japanese managements that are derided for their conformity and slow decision-making are eating Detroit's breakfast, lunch and dinner. That's a management problem.
Ford and GM are consistently designing their vehicles for a market that's five years or ten years in the past, and pointedly refusing to look at what's ahead....