GO
Loading...

What will it take to fix the Big Three U.S. automakers?

Paul Sims adds fluids to a 2008 Ford Escape at the Ford Kansas City Assembly plant, Friday, Jan. 26, 2007, in Claycomo, Mo. (AP Photo/Charlie Riedel)
Charlie Riedel
Paul Sims adds fluids to a 2008 Ford Escape at the Ford Kansas City Assembly plant, Friday, Jan. 26, 2007, in Claycomo, Mo. (AP Photo/Charlie Riedel)

"They are still making the same old vehicles - they may look different, but they are not as reliable as the imports. A complete makeover is impossible, but it better come sooner than later." -- Don B., New Mexico

"The Big Threecannot be fixed mainly because of their legacy labor cost structure and perhaps their aging factory infrastructure. Grab one of your nearby B-school grads and ask them if the our car industry is going down the same path as our steel industry. I'll bet it is real analogous. Toyota is going to grab their last bastion of defense, the pickup truck. I wouldn't touch a US auto stock with a 10 foot robot." -- Bill K., Oklahoma

"First and foremost, STOP making gas guzzling Monsters. GM, put the Chevy VOLT into production immediately, millions will be sold. Ford and Chrysler, work on hybrids in all classes, shut some plants and get lean and mean. Where is Iaccoa when you need him? We can do this, one of the greatest things about America is that we can shift gears on a dime. Lets get moving!" -- Steve N. Florida

"Leadership - leadership with courage to increase the speed of change - abandon systems that don’t work – create innovative relationships with suppliers." -- Marty A.

"Well, first of all they have to start making quality vehicles that can run several hundred thousand reliable miles without constantly being in the shop or getting recalled. The Japanese and the Germans are building reliable, quality cars for less that last longer and are better fuel efficient. If I can get a warranty on a vehicle for 7 years/70,000 miles as opposed to one with 3 years/36,000 miles, I will take the former over the latter. BMW's and Toyota's are maintenance free and in BMW's case they even pay for the maintenance. The same cannot be said of Ford or GM. U.S. carmakers have also got to get their costs down and build some vehicles that Americans really want other than Mustangs and Corvettes. The end of cheap oil is here and the designers and engineers in the U.S. are still living in the past. Good luck!" -- Kyle P.

"In my own opinion, they need to start making quality cars that run as well last as long as the foreign automakers." -- Matt K., Illinois

"Stop putting the emphasis on the gas hogs that they are producing and come up with solutions for the consumer." -- Bill J., South Dakota

"They are going to have to pull their heads out of the sand and look to the future instead of their past glories. Building bigger pick up trucks is exactly the backward thinking that has gotten them in the position they are in now. Pay attention to what people are asking for: cleaner running, more fuel efficient vehicles with way higher mileage per gallon, not polluting gas guzzlers that cost a fortune to fill. They have the same attitude of the past captain of his high school football team who doesn't realize he is pudgy, middle aged and has bad knees. Time to pay attention to the changed conditions of now and stopping pretending it is still then." -- Mary S., New York City

"A very dangerous and unpopular act like going open shop (non-union)." -- Irene H., New Jersey

"The problem with the Big Three is that ever since the gas crisis of the 70's their cars have lost quality, reliability, and originality. Just look at the value of an orignal domestic car made before then, now try and convince me that an all-original 2002 Ford Taurus will sell for a huge sum of money 20 or 30 years from now. The Big Three need to stop following Japanese and European automakers and try to regain their self-confidence or they will never stop playing catch-up." -- Mario B., Florida

More Comments

American cars are like red delicious apples; they don't have the crispness of Fuji. American cars are like buffalos on the prarie, vulnerable to predators and defenseless to foreigners. It's surprising they aren't extinct. People buy a variety of styles, not just tanks and bugs. The Big Three need to stop imitating each other and design more for the consumer, not for their own profitability... design for comfort, economy, breakdownless, freedom from maintenence and malfunction, convenience, ease, quietness, durability, safety, ergonomics." -- Michael H., California

"The Big 3 need to reduce their obligations to retirees and benefits to union members. Ideally they would decertify and in this process they would also need to look at thinning out management. The Ford contract which allows union members to sit for 3 years with 90% of their pay and retain benefits is incredibly stupid and should be dissolved immediately. The automakers say 'buy from us ... save our companies' - they have brought this on themselves. I have been intimately involved in a GM Powertrain snafu and have seen the millions of dollars this company wastes and in the process they put another company into bankruptcy. Maybe they should look at the Japanese model and out Japanese the Japanese. Another thought that occurred to me is that maybe the USA should commit to a high speed rapid transit rail system, people still fly in Europe and base the manufacturing out of Detroit." -- Eric T.

"It seems like every time some news agency floats their opinion poll out on the fate of the Big Three it creates a flood of future Lee Iaccos's and Henry Ford with new ideas. I respect each and everyone of them but come on, its the same spin every time. The only clear solution is that you have to break or negotiate the current u.a.w. labor agreement. Management and labor suffer from the old adage is 'Don't cut off your nose in spite of your face.' If labor doesn't budge and management doesn't move, well, it's over. Private equity is knocking on the door steps of Detroit and if labor does not realize its coming, well they better get ready. Believe me, management and its white collar work force currently working for the Big Three and the other tier 1 related companies are feeling the pinch. So wake up, or you will be long be gone. I'm not a union buster or management guinea pig, I'm a stock holder of all the current Big Three. As said before, not too long ago in the mid 80's the Big Three products used to keep up of our Japanese counter parts awake most of the night. They used to fear our products. Most Americans will buy our products, but first and foremost, manufactures have to design and service their products they make whether its made overseas or not. If you put your company label on it, let that alone mean something and truly all of our consumers will be back purchasing our vehicles and products. WAKE UP America, BECAUSE OUR COMPETITORS ARE HERE AND THE REST OF THE WORLD IS KNOCKING ON OUR DOORS. DON'T GIVE UP, DON'T EVER GIVE UP." -- Steven H., New Jersey

"It’s actually quite simple. All they need to do is learn to make a quality automobile for a fair price. The Japanese, the Europeans and, increasingly, the Koreans have all figured it out. Why can’t the US automakers? A few weeks ago I listened to a conference call given by Rick Wagoner. In it he laid out all of the plans in place for restructuring GM. Not once in this very long diatribe did he address the perceived lack of quality in GM products. This was very disappointing. I like a lot of Americans feel that most of the products offered by both Ford and GM are a piece of junk. I travel a lot in my business and therefore have the opportunity to drive several makes of rental cars. There’s not one that I have driven in the past 5-6 years that would lead me to a Big 3 showroom. The exception to this are light trucks and SUV’s. I just wish the Big 3 would put as much quality emphasis on their passenger cars as they do light trucks and SUV’s. Until they do they will continue to lose market share to, mainly, the Japanese. Also, fair warning, the Chinese are coming!" --Bob B.

"Real estate is location, location, location; automobiles are styling, styling, styling. Not since the 1930's and the designs of E.L. Cord and Edsel Ford/Bob Gregorie has Detroit shown any design ability. Ever since this classic era, they have been lost in the design wilderness, producing flashy, look-at-me designs that appeal only to the teenage mindset. A return to elegant, form-follows-function design would produce an instant 20% gain in the domestics market share, but it will not happen in 'maverick' Detroit." -- William P., California

"The problem is the Legacy cost that they have committed themselves to. Short of bankruptcy declarations and repudiation of these obligations, I do not see a bright outlook for the companies. The bad part is that if they default on these obligations then the Federal Government picks up the tab through the Pension Guarantee Fund." -- Bruce R.

"Reliability. I have owned vehicles made by each of the Big Three, but the last three vehicles I have purchased have been Toyota or Honda. I will not go back to unreliable vehicles with poor quality. -- Loretta S., Indiana

More Comments

"I see three areas where serious attention must be paid before the Big Three can awake from this nightmare: the use of labor, the application of technology and the pursuit of alliances. Indeed, the Big Three needs to reduce labor costs per unit produced. But it is unrealistic to expect actual rates of pay and benefits to be trimmed sufficiently to get that in line. An example of what works may be found in the Chevrolet Equinox/ Pontiac Torrent. Engines made in China are installed in those vehicles (the same ones that go into Chinese Buicks) along with other assemblies that are designed and built by others. This effectively contains the labor content apportioned to indigenous operations. Reducing the number of workers is a whole lot easier than reducing the cost per employee. Secondly, Americans still want to own SUVs but are balking at the cost of fuel. Advances in energy efficiency should be dedicated to such high-margin products before they are applied to smaller cars. The Chevrolet Volt concept whetted our appetite for a fuel efficient vehicle but the needed battery technology may be years off. And, it's not entirely clear that we're ready to get into cars again. The same technological concept found in Volt could be implemented today if a larger vehicle were used, coupled with heavier but currently produced Nickel Metal Hydride (NiMH) batteries. Moving an 18 mpg vehicle to 27 mpg has a whole lot more appeal (and saves a lot more money) than taking a 40 to 60, especially when the bigger one generates a lot more margin and is more highly desired by consumers. Finally, alliances are a major key to long-term survival. GM appears to be effectively using an alliance with their own Opel brand to make Saturn a real player. Its Daewoo operations can develop and manufacture small cars more efficiently than anyone else. And the NUMMI partnership with Toyota in California has been going strong for over twenty years. Chrysler may be onto something with its Chevy deal; a good start. All this leaves Ford, an impressive international player to be sure, but sorely lacking in a lower cost partner and provider of technology. Their licensing of Toyota's hybrid system is a good first step. Much more will be needed if they are to be a relevant consideration in the next decade. -- Jeff S., NY

"The Big Three will have to, first and foremost, reduce their hourly labor costs by 30% to get them in line with Toyota and Honda. They'll have to build quality vehicles that people want and they have to do something to lower their legacy cost. In short, only drastic concessions by the unions or bankruptcy will solve the mess they're in, anything less will only prolong the problems. They may also have to consider scaling back operations to their strengths instead of trying to produce vehicles for any and every situation. Ford can concentrate on trucks, the Mustang and a few other lines that sell well instead of making cars they practically have to give away just to keep antiquated assembly lines operating. The world has evolved a lot in the past 50 years, the unions and auto industry, however, are still stuck in the pre global marketplace era of times gone by." -- Ray M., Florida

"In a word, it will take actual product innovation. The Big Three need to spend less time posing with their hats in hand for White House photo ops and spend more time actually designing and building cars and trucks that the American consumer will want to buy in sufficient quantities for these firms to make a profit. Enough with the terrific concept cars that everyone lines up to see at auto shows, but will never be able to buy. The Big Three have to have the guts to bring innovative new technologies and designs to market far faster than the old standard, vague promises of maybe in 10 or 12 years that the presidents of these firms often give out as answers. Their competition in Europe and Asia are doing a far better job of meeting customer demand today. If the management of the Big Three don't wake up, they may not be around in 10 or 12 years." -- Paul, New Jersey

"Have each person that has a part in making the auto sign their name on the warranty. Stand behind their work." -- Angela B., California

"The Big Three US automakers need to to do two things: build vehicles that people really want, and vastly improve the quality of their products. The US automakers have been in 'restructuring' for 30+ years now. This occurs every time they lose a lot of market share to foreign manufactures. The quality is still below the foreign brands despite what some biased surveys report. And, the US automakers need to stop following fads. They did this with Minivans, then SUVs, then excessively with large trucks, and they got burned every time they do this. Now, they are into the ethanol/flex fuel fad and hybrid-hype. Ethanol has only 66% of the power of gasoline, and gets 1/3 LESS MPG than gasoline. A vehicle that gets 18 MPG will only get 12-13 MPG on E85. Not a viable solution. Hybrids and fuel cell vehicles have a lot of inherent drawbacks, from complexity, to loss of passenger/trunk space, to vastly higher manufacturing costs that will NEVER be cheaper than gasoline-only/diesel-only vehicles due to all of the additional parts needed on top of a typical engine. The US automakers need to focus on bringing their diesel models they already have in Europe over here to the US, and use US made Bio-Diesel (which doesn't have the ethanol drawbacks). No modification needed to run Bio-Diesel, and no special infrastructure to dispense it to customers. US automakers need to offer quality and safe, normal sized cars with high performance diesels." -- Jeff S., Washington

"I believe the US automakers should completely outsource their back-end operations including development and manufacturing (e.g. to Japan). US automakers should only own the front-end (design studio, marketing and the channel). Their core focus should be to recreate the product differentiation that existed in their 50s and 60s product line. They can hire me to help them in this strategy to regain back their leadership & profitability." -- Siamak S., California

"I have owned two GM vehicles that, although pristinely maintained, catastrophically failed with less than 90K miles on either. The Big Three not only need to cut costs almost immediately, they also need to engineer and build vehicles like Honda and Toyota that reliably last 200K or 300K. When was the last time you saw a GM, Ford, or Chrysler product with the original drive train that made it to 200K? There's been a lot of excellent marketing coming out of Detroit in the last 20 years but not much excellent engineering." -- Dan H., Tennessee