It’s been said that walking on quicksand with helium balloons will keep you from going under. Now that The Blue Oval has finally realized that the sands have shifted beneath its feet, there are plenty of people selling the automaker balloons. The United Auto Workers (UAW) has publicly pledged to help Billy’s Ford’s boys “any way they can.” Michigan Governor Jennifer Granholm has proclaimed her willingness to sacrifice voters’ taxes to keep the Wolverine State’s assembly lines rolling. At the same time, Ford is contemplating radical solutions: cutting dealers, selling assets, forming alliances. Is Ford finding buoyancy or grasping at straws?
The UAW’s Koala Brothers’ announcement (“We’re here to help!”) stems from a general acknowledgement that Ford’s Way Forward has lost traction– if indeed it ever had any. At the same time, the union’s faux altruism seeks to overturn the common perception that “if you’re not part of the problem, you’re not part of the UAW.” To that end, Ford Division UAW Vice President Bob King recently signaled that Ford’s talk of inter-company alliances and another round of worker buyouts would “not be out of the question” provided they ensure “mutual survival.”
Of course, King’s statement reveals the obvious (if overlooked) fact that the UAW would have to approve any hook-up between Ford and another automaker. Which they would– provided Ford’s new partner agrees to maintain current salaries, pensions, working practices and benefits. (File that one under “Not Very Likely.”) As for the UAW’s willingness to accept further blue collar buyouts, the UAW’s members have a history of “helping” Ford by taking money for not working. Perhaps Mr. King would like to extend his assistance to closing Ford’s infamous, expensive and still not fully disclosed “jobs bank.”
In short, don’t look for the UAW to make any bold moves (a.k.a. “historic givebacks”) beyond pocketing Mr. Ford’s cash to leave the building. Why would they? Ford’s buyout offers only extend to high-seniority workers. Workers without a parachute won't entertain “short term” cuts to their compensation knowing that a new four-year contract with The Big Two Point Five is under negotiation for fall ’07.
Michigan Governor Jennifer Granholm’s relief plan is also a lot less than it seems– but in a nice way. Gov. Granholm and Michigan Economic Development Corporation (MEDC) President and CEO James Epolito want to save 56k Ford jobs (their estimate) by granting FoMoCo $151m worth of tax credits. Ford’s part of the bargain: invest a billion dollars in its Michigan facilities over the next 20 years. A billion bucks shared amongst nine major facilities is a laughably small amount. Unless Ford’s pulls the plug, the company will invest that much money in its Michigan plants as a normal part of doing business. When that inconvenient truth emerged, Granholm’s plan submerged, taking a lot of good will towards Ford with it.
And then there’s the real deal: Ford’s plan to trim its 4300 member dealer network. According to press reports, metropolitan dealers in 18 urban areas will close or merge with successful locales to streamline sales, increase margins and free-up overhead. This is a much needed, long overdue move; Detroit is home to 31 Ford peddlers and 14 Lincoln floggers. But the maneuver’s mechanics are murky. Ford spinmeister Jim Cain claimed "It's totally voluntary… We'll handle this in private and in a very collaborative way." Voluntary? Private? Collaborative? That sounds an awful lot like "cha-ching" to me.
Just like Ford’s plan to slice 30k jobs and close 14 plants, the dealer downsizing program will not be cheap. But hey, you gotta spend money to save money. As Ford has already dropped $10b on Jaguar, many have come to believe that selling the British brand will be Ford’s next great leap forward. Despite last week’s frantic comments by Ford CEO Mark Fields– “We will sell the furniture if it helps fund new products”– Ford’s not going to not let the Cat out of the PAG. As revealed on a recent TTAC podcast, Ford’s brand management has rendered Jaguar virtually worthless. They’d have to give it away. So Ford’s decided to [re]reposition Jaguar as a “niche” luxury brand, to give Jaguar buyers more of what they love: Ford Five Hundred switchgear.
Seriously, there is no newfound cash flow at FoMoCo, nor is there likely to be any in the near future. If things get bad, Ford will sell Volvo and team-up with anyone with deep enough pockets to bail it out. But we’re not there… yet.
President Kennedy once said “The great enemy of the truth is very often not the lie–deliberate, contrived, and dishonest— but the myth– persistent, persuasive, and realistic”. The myth is that Ford is a can-do company can turn itself by sheer force of will. The truth is that Ford is at least three years too late and a few billion dollars short, wearing a union-made straight jacket, slowly sinking into bankruptcy.
Ouch!
Sometimes the truth really “schmartz” doesn’t it?
Ford is just doing what seems to be working for GM. Expect Chrysler next.
It’s totally voluntary…we’ll handle this in private and in a very collaborative way.
The domestic dealer business is looking worse and worse, but I am guessing this means that there will be ca$h incentives to merge/get out.
Anyone here work for a Ford dealership?
Yeah,
Ford is prime merger material. It still has strength in its trucks and SUVs and though that’s a strength that isn’t very useful right now, it’s a strength that Nissan, Honda, Mitsubishi, and Hyundai need in the long term.
Am I saying that their will be an alliance or merger with Ford in the near future with a Japanese or Korean car-making specialist? Yes I am. And I’m not even going to make a “Bold Moves” remark here.
Not to nitpick, but $151 doesn’t seem like a lot of money. Billy Ford could probably do better to stand at the end of an off-ramp with a sign that says
Need Help Will Manufacture Okay Cars God Bless
If that doesn’t bring in the bucks, nothing will.
Maybe Ford can come up with a viral marketing campaign to replace the acronym my family, for one, uses, namely Fix Or Repair Daily.
Why is everyone so compelled to try to be witty? I keep hearing Stewey from Family Guy in my head.
You ougt to see someone about that.
http://www.ilovewavs.com/Effects/Music/RimShot.wav
Without a large number of dealers, where will the vast production of SUV’s go to sit and be sold away at a discount?
It’s like anything else in business or government. If you are too big it’s too hard to make decisions and everything is slow. If you are too small you don’t have the capital to get the job done right (unless you are in the supercar business). Both GM and Ford need Chap. 11, they need to kill the union contracts and get rid of half their dealers and staff. They need to become lean and focused.
Design will bring in the sales and reliability/quality will retain them.
The more you know the worse it gets. On top of all this – what ever happened to the Visteon fiasco. Not a single buyer for these operations has been named yet – though “Several buyers are showing interest.” Like the Chinese. Who else would take on the UAW voluntarily. Every Western supplier knows they will totally bent over once the sale is complete. Ford is going to be paying full wages to continue to make headlights, IPs, fascias, gas tanks, etc for many years to come.
Regardless of how much cash they carry on the books they are definitely hurting in the cash flow area. They refuse to spend money on ANYTHING (except really bad acquisitions.) How old are those stamping dies that hammer out Ranger bodies every day? (16 years for those not counting.) Econoline? Ditto. Taurus doors? 11 years.
Putting the safey face on in TV commercials, yet making side impact airbags optional. Don’t they know they’ll get torn up for this every time. Warranty extension. Where’s the money coming from for that? Their quality hasn’t stepped up entirely to the plate. Probably not even close (bribing Powerstroke diesel owners with $2,500 to buy yet another piece of junk. Who puts their hand on the hot stove twice?)
It goes on and on and on. My opinion – they give all their money to Ron Stinkyfinger and the UAW because they don’t have the balls to do anything else. Thats’ their culture.
Both companies have far too much liquid capitol, they can’t file chapter 11 even if they wanted too. And even if they could it’s still a hundred times cheaper just to buy off the union workers so they will “break all ties”.
BTW… Mercury is 2nd overall in the 06′ JDP vehicle dependibility study just under Lexus. You know… just want to throw that out there.
When honda’s Marysville Ohio plant opened in the 70’s and after many tries rejected (that is the employees did) the UAW the winner of the game was decided, but we still had to play out all of the periods. Why would any foreign mfg. want to buy an old ford plant with the UAW as a non declinable option? You go down South (read non union red neck territory) you get the state to give you land, improvements, even job training money and you build new (your not going to pay real estate taxes anyway for many years). What fool ie. mercedes, nissan, honda, toyota, bmw, hundai, wouldn’t do the independent thing with all of these perks? Honda gave them the blue print (although Ohio is in the north) the others just ran with the ball. So the new players (ie foreign mfg.) all have the newest plants, least taxes, flexible work rules, etc. I am not here to pronounce which is fair, just to state the law of uninteded consequences. Back in the 70’s Ford, GM & Chrysler dared the foreigners to come over and build here on a level playing field. Be careful what you wish for, their here the field is still not level for the old big three; and why would they the new comers want to hook up with the sins of the past? They don’t and won’t. Ford & Gm must go it alone and I don’t think anything short of trashing the contracts and legacy costs will even begin to make them even.
After what Ford did to Jaguar with the S-Type and the OMFG X-Type, they deserve to go directly to bankruptcy.
Jon.
Mercury consists of:
Sable (no longer sold): Low Tech ancient platform means plenty of time to get the bugs worked out. Atlanta/Chicago built those for a LOOONG time.
Grand Marquis: Ditto
Monterrey: Ditto
Mariner (If included in the data): A good vehicle but really a Mazda.
Milan: Ditto
The worst Ford ever for Things Gone Wrong was the Mercury Capri imported from Australia. And a death trap to boot. The best ever was the Festiva built by Kia. I know – it was a long time ago.
They just don’t really ever do anything new/original. Can you imagine if Ford embraced quantum leaps in technology like the Japanese and Germans do? Mercedes can barely manage the complex electronics. How many Ford’s have variable valve timing, for instance.
Oh yeah – Found on Road Dead, F@&*er Only Runs Downhill, Fix Or Repair Daily, F&$#ed On Race Day, F&^%ed Over Rebuilt Dodge……
Mariner is a FORD Escape
Milan/Fusion is on the Mazda 6 platform (Built in Flat Rock MI)
Capri, Festiva good? What? LOL!
Even my primitive mustang has variable valve timing genius… how about you do some homework…
Slow down and read. Mariner/Escape are derived from the Mazda 626 platform, and are built in Kansas City.
Milan/Fusion/Zephyr are derived from the Mazda 6 platform and are built in Hermosillo, Mexico.
I never mentioned subjectivity (good or bad.) I was referring to TGW – real numbers. Capri was the worst, the Festiva was the best. No doubt the Festiva’s incredible simplicity contributed to that.
Finally, I didn’t say that no Fords had VVT. I was asking how many (percentage.) Honda is 100% for example.
At the end of the day Ford is still beyond hopelessly pathetic.
Slow down and read. Mariner/Escape are derived from the Mazda 626 platform
No, they are derived from the Ford Contour/Mondeo just like the Jag X-type.
As per my memory (and Wikipedia), they are built on a platform derived from the prior-gen Mazda 626. The left hand drive versions are built in Kansas, and the right hand drive (Tribute & Escape) in Japan at a Mazda plant.
The Flat Rock, MI builds the Mazda6 and Ford Mustang.
Numbers don’t lie Sid, sorry.
http://www.jdpower.com/corporate/news/releases/charts/2006133a.gif
Merc 2nd
The beloved Mazda is 21st
Yep, Mazda is sure boosting Mercury in this department.
So let me hear it Sid… Tell me it’s all a conspiracy and pack of lies. Or perhaps the data is skewed one way because of some reason you can randomly make up. What is it going to be this time? What scientific study did you conduct or is it just going to be your opinion?
And don’t forget my favorite acronym, f#%king owner’s real dumb. There’s my 2 cents for the day.
You make a good point but please don’t be too ignorant, specifically about JD Power rankings. First, these rankings are based on customer surveys which are not guaranteed to be scientifically accurate. Second, JD Power just changed their ranking system this year, causing some brands to shift around. If their system is such great argument ammo, then how do you explain the changes? Did JD Power just this year manage to get their rankings to perfectly reflect the truth about cars, but every year before that was total crap? I don’t know which of their systems is better, but I know they can’t both be right.
What else can you use really? I drove an old insert car make here once and it was crappy so all cars made by that company must be a POS forever? Over 45,000 owners where surveyed in 2006 that owned 2003 vehicles. This is what they said. If the info is skewed than it will be skewed for every make … I’m not sure how you can point out one brand and say they are different because insert opinionated argument here .
It must be a conspiracy.
What JD Power surveys tell you about the vehicles is accurate from the owners perspective. What they don’t say is that the age of the owner base has a great effect on the scores. This is why Mercury and Buick score high….old people are less critical. This explains why a Mercury GM out scores a Ford CV but they are the same car but the customer is older.
Ha-ha! I have worked as a tech at a Honda, Saturn and a Cadillac dealership. One thing is constant… old people bitch… a lot. They have nothing else to do. They can go to the dealer at a moments notice at any time and get free coffee if they are retired, can you say that? The younger ones will deal with it more because they have stuff to do!
I would half accept the argument that old people drive there cars less and maybe the cars just do not have enough miles on them to break.
This explains why a Mercury GM out scores a Ford CV but they are the same car but the customer is older.
You could make the same case for Lexus/Toyota.
But yeah, Ford has the Mustang and everyone knows they are a POS! LOL
Mercury #2 in the JD Power survey?
EVERY vehicle they sell is badge-engineered from Ford, many built in the same plants by the same people. Why is Ford 12th and Mercury 2nd? Moreover, why do Mercury owners report 1.51 problems per vehicle whereas Ford owners report 2.21 on what are essentially identical vehicles?
Aside from the fact JD Power surveys are notoriously un-scientific and inconsistent (despite their 06 makeover), quality isn’t the **only** thing that makes people buy cars. Plenty of VW-philes are willing to put up with issues to get a car they perceive to be better – and that’s just an example. Even if Mercury was #1 in JD Power, it woudln’t change the fact that their cars are poor re-badgings of Fords perceived (for the most part) as mediocre to begin with. Even the Milan is uglier than the Fusion.
Hmm. It has been posited here at TTAC that Ford could drop Mercury as a brand and nobody would notice.
But that JD Power ranking discrepancy makes one wonder if that is indeed true. Perhaps there is some brand equity in the Mercury name? Maybe they should keep Mercury and drop Ford! Then yippee, they are #2 in quality, nipping at the heels of Lexus…
I have to say that it’s ABSOLUTELY the older demographic of the Mercury buyer that contributes to the higher JD Power ranking.
Case in point;
An elder uncle of mine who drives a Mercury Grand Marquis with a fake convertible top, RAVES about this car ALL THE TIME! This despite several serious mechanical issues (transmission, exaust system fell off, etc.) that he’s had within 50,000 miles of ownership. It’s his way of “putting us foreign and small car drivers in our place”.
My biggest complaint with Ford and extended to GM and Dodge is that these companies don’t seem to love building automotive products. There is no vision to say we need a X-sized product…let’s build what’s needed and make it the best one.
Instead, from a consumer perspective, I get to choose from a tepid design that may be built well-enough but lacks enthusiasm and is cost-cut to use the lowest priced supplier parts as possible.
Warped rotors, unmatching plastics, NVH issues — these are things I expect from a start-up company with little experience building cars, not from a 100+ year old company that can hire the best engineers and workers on the market.
I’ve never understood why so many unreliable cars have taken top spots in JD Power’s surveys. It’s been like this for years. Consumer Reports and carssurvey.org shows something quite stark in contrast. CR shows Cadillac being among this worst.
Maybe it’s because CR does not accept advertisements and doesn’t allow other companies to use their name? One thing that JD Power is dead on is the last place showing of European and Korean cars.
As much as we all (myself included) praise the potential of Ford imports, one should never forget the great “Merkur Scorpio.”
That point aside, my personal experience with US Fords is great, as is my father’s, my sister’s, and my brother’s. true, they are rarely the most fun vehicles to drive, but they get you around reliably, they are comfortable, mostly easy to maintain yourself, and in my experience they go many hundreds of thousand of miles.
I won’t defend the boring, uninspired, and low-risk designs, but I don’t need the flash either.
I could go through the list of vehicles Ford sells of which there was no Mercury in 2003, but a list of what was similar would be shorter:
Grand Marquis – Ford Crown Vic About 43% of Mercury sales
Sable – Taurus About 30% of Mercury sales
Mountaineer – Explorer
Everything else that Ford sold was not sold by Mercury, and Ford basically quit selling a civilian Crown Vic by 2003 (go to a dealer to buy one – they will lie to you and tell you it is not available so they can try to push you into a POS Five Hundred)
Grand Marquis kicks ass – I’ve owned two, and my current 2002 with 54,000 miles has not been to the dealer for other than fluid changes. Old people buy them because they are smart, and by that age they don’t care about trying to impress someone.
I’ve owned “performance” cars in the past – I finally decided to buy something comfortable and durable, and let the posers worry about their image.
You sound like my uncle without stuff falling out of your car.
Funny how you call the 500 a POS. It looks as though it was MADE for all the Grand Marquis afficionados.
Once you drive the new Mustang – as I have, both a coupe and a convertible – you get a feeling that Ford can indeed make it. What they need to do is forget SUVs; wean their buyers away from such machines. And forget the ones that won’t leave them behind.
The best thing that can happen to Ford, or GM, is for gas and diesel to keep going up. Ford just keeps flogging Explorers, Expeditions, F-150s, etc. and it is sad. Everyday, I hear one Ford dealer or another touting, “We have trucks galore!” No one can really afford that crap. And no one, save for farmers and contractors, needs them.
Build cars, good cars if not great, and the future is yours, Ford.
Terry is right, for Ford, it’s all about cars! In that sense I think they are better positionned than GM, except when it comes to sub-compacts, where they have nothing and nothing in the pipeline.
Problem is those truck plants, addicts (to the profits) and mentality (it’s safer!) isn’t going to disapear overnight, unfortunately.
It would be very unlikely that Ford (or GM) will merge with any foreign brands. This is because of the precedence that the UAW has established with merged foreign transplants in America. (Mercedes merges with Chrysler and now the Mercedes transplants in America are UAW facilities.) The fact is that any foreign outfit with deep pockets (Toyota, BMW, Honda, Nissan-Renault, Hundai) considers the UAW to be the kiss of death, and they would not do anything to jeopardize their non-UAW status of their current and future transplants in America. If Mercedes knew what the UAW had coming to them would they have merged with Chrysler? Probably not.
Watch out! It’s a giant JD Powers survey conspiracy! Quick, put on your aluminum foil hats before its too late!
Merc’s are built like Fords like Lexus are built like Toyota’s.
Five Hundred is the antithesis of the Panther – a rebadged Volvo platform that has a funny transmission, an overworked engine, is wrong wheel drive, and is designed with planned obsolescense in mind. It is at best a half-assed attempt, and I do think they think all Panther buyers will switch.
Panther was designed back when Ford had the talent in-house, and pride in the cars they put their name on – before CAD was able to perfect the “6 years and dead” mindset to automobiles. It isn’t fancy, but there is a reason the platform is still around after 28 model years.
Another example of how the new Ford Motor Company is completely clueless about what their customers like.
This morning the other shoe at ford dropped. Apparently in addition to the 14 plants and 30,000 jobs to be lost in the future, ford will cut 188,000 vehicles from their production from now until the end of the year. This company is in a free fall, and if it has to pay penalties to suppliers for parts ordered and a union for labor not needed, it’s not going to be pretty. There total production for 06 from 05 will be 9% down. Will ford be half it’s present size when all of the smoke clears? Can you stop downsizing wants it’s begun? Will they make any money selling the trashed brands of jaguar and land rover? Is their 20 million+ in cash reserves going to last? If I could answer any or all of these questions with any accuracy, I could have my own paid website where analysts would worship at my altar of information. (But, I can’t)
Yeah, complain about the surplus of unsold vehicles and bloated operating costs and then proclaim Ford is doomed because they are cutting production all in the same breath.
What would be interesting to know is: How much money does Ford spend each day; and how much money does Ford make each day?
gearhead455,
I think you’re missing the bigger picture. Ford (and, even more so GM) must maintain a certain volume of merch in order to even pretend to fund the gold-plated pension and health care bene packages that they are stuck with. Unless/until they declare bankruptcy. (Neither is even close to funding either one of those plans, but that’s a whole different topic…)
The reason the surplus vehicles are bad is pretty straightforward – they ain’t sellin’.
The reason cutting production is bad is because it then requires an even higher profit per vehicle to generate the amount of money required for obligations that Ford is stuck with.
This generates a whole new level of bean-counter-cost-cutting. Said bean counting has led Ford to the trough-of-crap it now finds itself drowning in.
They can’t move (most) of the product they make now without huge incents.
Huge incents lose money. Since Ford’s legacy charges are never going to go down (again, w/o bankruptcy) the trick is rolling some new reallyprofitable vehicle lines before the money runs out.
Ford is in financially far better shape than GM. Mathematically speaking, Ford does have a slightly better than a snowball’s chance in Hell of survival.
Sadly, looking at what’s actually happening on the ground – Ford’s only hope is GM flames out spectacularly and they get some free market share.
gbh, You have said it. You can’t drop 28% of the vehicle that makes the money for the company and say it’s for the greater good. Ford is in no condition with product or profit margins to pick up the slack of suv’s and pickups with cars. In ten short (or long to some) years ford has managed to in no special order:
1. First pay to much then Trash jaguar and land rover
2. trash lincoln
3. trash sable and taurus (the no#1 selling car then)
4. lose the lead in mid size (explorer) suv’s
5. trash the thunderbird
6. allow the full sized fords and mercury to atrophy
7. Buy a chain of garages and repair business in Europe all sold for a loss.
8. sell Hertz a money maker
9. put all of the chips on the venerable F150 (now 28% down in sales)
10 Increase badge engineering to an even higher and worse degree ie. the lincoln zephyr, a mazda in saturday night clothing.
http://money.iwon.com/ht/nw/bus/20060823/hl_bus-l23294128.html?PG=home&SEC=news
“One investment banker who follows the automotive sector closely said recently that a Renault/Nissan link with Ford would be simpler and more effective than one with GM because there would be less overlap of brands.”
You don’t need to be a rocket scientist (or I-banker)to see this.
gbh: I have a gut feeling that what we are seeing these past few months FORD’s products are flaming out and GM is essentially gaining market share from them.
I’d wager that Ford a) sells a brand (Jaguar, Land Rover, or something else), b) axes a brand or two (Mercury, or Ford cars), c) or forms an alliance/merger with Nissan, Honda, Mitsubishi, or Hyundai or d) all of the above.
Any or all of the above are more likely than GM seeking bankruptcy or a merger in the near future.
Re: axeing Mercury…
I used to think that was a no-brainer, but maybe there’s some equity there?
An option that may be as good as cutting Mercury would be just to stop selling Ford labelled cars. Ford could focus on SUVs, trucks, x-overs, Mustang and maybe one token sedan….
Did you see where Ford is offering their own 0% for deadbeats now and unlike GM they are letting people know that even if you suck you can still drive a Ford
stanshih, I just picked it up the big difference this timeis the sub-prime scores they will accept and it goes for 72 months. How worthless is your new iron if it has to go out the back door this way? In the old business school parlance this is kicking the can down the road. It shows a total collapse of ford’s retail sales in all of their products. The beauty of used car sales was that some people can’t and should not buy new cars. They will never be able to keep up with them or even insure them. For ford to come to this means they have accepted that the stuff cannot be sold for anything close to even dealers cost in the quantity they have on hand. But they will pay later when these cars come back as wrecks and they have no other assets to sieze to be made whole. You are actually premeditating the foreclosure by putting this expensive iron in people’s hands who can’t make the payments. The no interest is more than negated by the high purchase price and low down payment or inexpensive trade this type of buyer has. He is now paying for his car as much as his housing. Ford, this is not the american dream, and you will join the real estate bubble as people can’t arfford to re-finance their low interest adjustable loans.
The J.D. Powers survery is based on owner opinions but I want something based on actual repair statistics.
The way I see it is different brands, different vehicle prices appeal to different demographics and those different demographics have different expectations, and often take care of their cars differently.
I don’t fit the typical consumer demographics very well and my cars always preform (last) better than the average example. I take care of my cars way better than the just get in and turn the key crowd.
While the JD Powers survey are great if you are a Lexus, if you are a number of other brands, you could be getting an unfair rap.
Buicks – great ratings but consider who buys them (retired crew). What do they do with them? Travel, run back and forth to the store or church. No stress for the car. No racing. No hauling.
VW – Driven hard because “they are German”. Riiight. VWs break too. I see two types of VW drivers – the hard driving street racers and the type that just turns the key and goes. When it breaks off to the shop it goes. Hopefully the shop has fair prices, honest mechanics. If the driver knows nothing about cars they have to rely on the honesty of the mechanic. Every little thing that goes wrong – be it a fuse or a belt requires a trip to the mechanic. Maybe there is another demographic that deals with these little things themselves. Would that group reply that their car was more reliable than the 24 yr old VW driver that totally relys on the mechanic to replace even light bulbs? I think so.
I think the JD Powers surveys tell you as much about the owners as the cars they drive. Find an expensive car with a low rating and open a specialty shop to service those cars. You’ll get car ignorant owners (people who are smart but know nothing about cars) and cars which MAY or MAY NOT break often to repair. Maybe the car breaks becuase it has low quality parts or designs. Maybe it breaks because the owners don’t know how to drive a car so it lasts!!!
I own 3 VWs. Excellent cars, excellent prices if you know where to look for parts, and reliable well beyond 200K miles. I’m a big bearded burly guy with wife and two kids and I drive a ’97 VW Cabrio. And like it… No, not a Miata threat but it will carry the family and I can go to the hardware store to retrieve 100% of the project materials I need using our utility trailer. It will tow as much as our CR-V.
Hondas – Ours (5 of them) have been A+. Our current CR-V has been flawless for 130K miles. Maintenance only. Tow with it, dirt roads, snow, mud, towed a Dodge Spirit 40 miles with it (not recommended – plenty of power, not enough brakes).
Cheap cars – plenty of cheap people driving cheap cars. Cheap people cheap out on repairs and use cheap parts. Lots of coat hanger and duct tape repairs in this crowd. Of course their cars die young. Why is it that cheap car people seem to also batter their cars to death? I feel certain that I could get 200K out of a cheap Kia car if I bought it new.
The car companies have a tough field to play. To win the quality wars they have to beat the public’s perception that the imports are better. Tough battle. I don’t think they can do it. I hope they can and I hope it wrecks whatever corporate culture they have that holds them back. Oh and the unions too.
They used to try to win the “big SUV” battle. And for a while they did win.When I was a kid in the 80’s they were trying to sell us big cars back then too. And their compacts were a joke. A Celica or VW GTI or Accord vs a Fairmont or Citation (we got ALOT of good service from one though) or a K-car. Not even a battle. Imports won on MPG, handling, “content”, style, etc. They were at the head of the pack on looks too. Show a kid an iPod and a Walkman cassette player. Both make equally good music. Which one will they take? Even if the iPod is a larger financial risk, it is just cool-er, it does more things, and a great style. The Walkman does it’s thing well too but it is out of date. Out of date is okay with if there is a financial advantage. I’d buy a brand new 1985 VW GTI if I could but the price better be the same 1985 price plus inflation. I’m not going to pay premium prices for old designs. (In a way whoever bought my ’97 cabrio new did pay a premium price for the old design. This car is not that different mechanically from my 1984 Rabbit convertible! ). I guess another difference is that the import manufacturers seem to refine, refine, refine a design. The domestics give something all new, cancel the old model and the new model is no better than the old model but they’ll tell us it is.
Now we are back with the same battlelines. Big, thirsty domestics vs the trendy imports. As soon as incomes catch up with the price of gas Americans will buy big again and the domestics will make a comeback b/c Americans seem to think big is better – when they can afford it. Suddenly the small car crowd has been be noticed again (now) and are welcoming the newcomers to the small car party. And then the price of gas will fall (relative price of gas vs income) and slowly the small car crowd will quietly and slowly thin again. It’s a cycle. Look at the decades of cars since the depression. Happens about every 10 yrs. Prob each time fuel goes up, the domestics lose more and more market share as public perception “remembers” that Detroit is stupid, and new oil fortunes are made in the time between rising oil prices and the time when “most” Americans are shopping for frugal gas sipper cars.
The imports build clever compacts with good style by default. They add larger vehicles when the market supports them. They build these smaller cars and sell them worldwide.
The domestics by default build large vehicles that only sell in North America (and a few other markets where gas is “cheap”) and only the price of gas forces them to give attention to the smaller vehicles. Their fortunes lie in the price of gas. Cheap gas = profit for Detroit. I think b/c they don’t build smaller vehicles all the time and b/c they build different cars for different markets worldwide, their designs are not as trendy, not as clever, not as good as the imports b/c they don’t have their heart in it. They can do it in Europe though. Saab and Volvo and Jaguar, etc are nice if you can afford them. If you want something under $20K then you get cars that just compete well with the imports. GM COULD do better if they would bring us the Opel lineup WITHOUT alterations… Sorry for all the CAPS but GM brings us their Opels and screws them up in the process – witness the Catera and the LeMans. Go look at the Opel website. Some nice cars, and some nice plain/basic city cars. Wish they would apply no-haggle pricing to all their models, just leave the Opels named Opel (kill the Saturn brand), and roll all of their brands into GM and sell them at GM dealers. I see the coming of CarMax style “all-brand” dealers someday.
Back to my rant: Also b/c the big vehicles offer more profit, the domestics try to motivate us into the larger vehicles with plain, miserable compacts. Maybe that is a result of trying to build a compact that is as cheap as possible since there is so little profit in them and b/c they have to rely on incentives and fleet sales to move them.
All the discussion of conspiracy, poor management, union antics, styling, and percieved quality all work against the domestics and are OFTEN but not always excuses for former domestics customers to justify their decision to go with an import. Later they will use a “need” for towing capacity, hauling capacity, off-road ability, passenger capacity to justify a larger vehicle once fuel prices come down relative to their income. We all know that most of these vehicles seldom haul 7 passengers, tow boats week in and week out, and will hardly ever see slippery or muddy road conditions. Some will of course, not many though. It is not a dislike for large vehicles or a true admiration of smaller cars that these “turn-coats” have, but rather a dislike for the higher fuel prices that cramps their spending power. They aren’t going to let fuel prices change their lifestyle. Europeans I knew (lived in Italy for 3 yrs, Navy) had a much more frugal lifestyle to offset the cost of transportation (taxes, vehicle prices, fuel prices, taxes, taxes, taxes – did I mention taxes? Universal health care = taxes!). There middle class had a good life but not the big houses, mutliple cars, boats, motorcycles, etc like folks around here do. However most had no mortgage, nice clothes, nice homes, nice cars, travelled more than us, vacationed more than us. They didn’t consume as much STUFF as we do.
The domestics ceeded the compacts market to the imports while they built the “real” cars and trucks. Now the imports are building ever larger vehicles that compete directly with the domestics last hot market. Once the imports win that market the domestics will be dead. They will come back but hopefully a much smaller and leaner corporate culture that builds cars we want. I work for a company which gets much of it’s bread and butter from the auto manufacturers and their suppliers. I recently read that the experts are predicting 50-65% fewer parts suppliers after GM and Ford and DCX stabilizes. That’s going to hurt our company to I feel certain. Maybe when GM and Ford makes their “comeback” they will build more SSR and GT-40 STYLE vehicles – something interesting that doesn’t cost a small fortune (i.e. a Civic or an Accord). They spent so much money on “halo” cars and luxury brands only to shelve the designs. How about a T-bird at Miata prices? How about a SSR at Colorado prices? Might not have all the high end materials and the high end performance but leave that to the aftermarket. It shouldn’t have to be a Corvette or a GT-40 to be interesting…
Look at the GM of America lineup. How many brands? How many models within those brands? How many rebadged varients on those models? Then looked Opel or VW or Renault on the Internet. Many of those European brands have 5-7 models. 1 per class. Maybe multiple trim levels per model. GM and Ford have too many brands and too many of these brands compete against each other inside the same corporation. DUMB. Kill of Buick or Caddy. Kill of Pontiac or the Chevy equivalent. Kill off Saturn or Opel (Saturn please). Kill off GMC or Chevy trucks/vans. Kill off that ugly SUV snouted minivan that I refuse to even learn the name of. In Ford’s case Volvo, Jaguar, and Land Rover are plenty distinct enough but rather than The luxury brands teaching Ford new ideas, and boosting it’s image, I think Ford’s image has hurt Jaguar, Volvo, and Land Rover. Maybe it is time to get ‘rid of them.
I have “A better idea:” Fire the current designers at Ford. My friend bought a 2002 Explorer, which sold at 12,000 and with all the ridiculous fees and taxes, cost 19,000. The real problem is: The idiots who designed this model decided to make the outside air permanent, instead of providing a switch to turn it off when on dusty roads, behind diesel vehicles or in heavy traffic with exhaust. Even worse: He keeps foil packets of ketchup in the glove compartment, and had some in the hatch. Guess who decided to move in and sample them: mice. This is SUPPOSED to be a vehicle with almost all gaps to the outside either closeable or nonexistent. Yet a field mouse entered, with it’s extensive family, and chewed everything. My friend keeps a toilet paper roll for tissues, but now it was a nest! The packets of condiments: all over everywhere, ketchup smeared on everything. He had a bag in the back. Guess what was in it: ACORNS!!!! How did acorns get in the bag, if he didn’t want them there? Yes, folks, the creatures that are NOT supposed to be in a car-mice. I have heard of mice nesting in a car’s air filter, but in the car itself?!! All because Ford, or rather F(ound) O(n) R(oad) D(ead); F(ix) O(r) R(epair) D(aily) or any other acronyms you can think of feel removing the option of outside air is a better idea. How do they know what I or anyone else wants? Why is removing the outside air switch a good idea? Why is it a good idea to allow disease-carrying rodents to come and go as they please? All for the good of FORD, not you and me. I would rather have a Toyota, Nissan, Hyundai, Yugo or Volkswagen ANY DAY than a Ford. Even the Mitsubishi sounds good at this rate, and I am wondering if Xerox will be entering the ring as well! I would rather drive a copier to work than a Ford Explorer!