I've been wary of GM's alt propulsion press vehicles since ’04, when The General faked a hybrid test drive with Autoweek, slapping a cod cover on a pushrod powerplant. So I approached USA Today scribe James Healey’s review of the hybrid Tahoe with no small amount of skepticism. "GM says the electric-only mode could take you to 32 mph under ideal conditions. But the test showed that accelerating in traffic means electric-only lasts only up to about 10 mph." Oops. "Tahoe's gasoline engine shuddered as it fired up and began contributing power. Expect the shakes to be gone in regular production models, says Mark Cieslak, chief engineer for GM's full-size trucks." Doh! But wait! There's more!
"The transmission got hung up on full-throttle shifts, holding the engine at 5,500 rpm too long, followed by a falloff in power, before up-shifting. Also gone by production, Cieslak promises." And yet USA Today's headline proclaims "Tahoe Hybrid is a Real Treat" and "Chevy SUV is nicer than gas model." Yes, once again, GM's spinmeisters have convinced a too-credulous journo to devour a tray of puffed-up, half-baked goods.
It’s been a while since GM trotted-out this “look at the shiny object” PR strategy. In every case I can remember– from the new Tahoe’s debut to the United Auto Workers (UAW) “historic health care giveback”– distraction preceded disaster. As GM is set to reveal its second quarter financial results on Tuesday, and the automaker has just experienced a horrific June, and July ain’t gonna be much better, I can only conclude that no one at RenCen will be singing “Happy Days are Here Again” anytime soon. If ever.
Note the desperation that’s infecting GM. It’s not a sense of urgency, as Mary Ann Keller famously requested when eliminative products hit the fan back in ’05. It’s a sense of bewilderment and befuddlement, leading to irrational behavior. The on-again, off-again, on-again, off-again plan to launch a range large rear wheel-drive cars illustrates GM’s growing propensity for contradictory chaos.
As does the decision to add hundreds of engineers to the Volt electric car project; a car whose very existence depends on battery technology that doesn’t yet exist, whose arrival has been promised for 2010 (at the last annual stockholders meeting, of course). Import a German compact for Saturn, even though it can’t make a dime? Sure! Stick a diesel into a Cadillac? Why not! Hybridize poorly packaged, gas-guzzling SUVs? Duh! Who’s gonna resurrect the electric car? We are!
Clearly, the vast commercial enterprise that is GM is doing everything it can to find a way out of its North American cash crisis. Clearly, that’s the problem. There is no master plan. There never has been. Instead creating and implementing an overarching vision of a new GM and working towards it, CEO Rick Wagoner has launched a relentless cost-cutting fatwa. Which is a bit like the captain of rudderless, sinking ship concentrating on jettisoning as much ballast as possible.
While Boeing’s ex-exec is busy reducing, refining and redefining Ford, Wagoner’s mob can’t get past the first part of that process– presuming they even want to. They seem to think that General Motors can get small at home, get big abroad, and act big everywhere, all at the same time. Hence GM’s semi-decision to concentrate on “world cars;” it appeals to the notion that they can solve their problems by continuing to rely on the sheer scope of their operations.
Once again, it must be said that Rick Wagoner has never set benchmarks for GM’s turnaround. There have been promises and plans aplenty, but no hard and fast publicly declared targets and deadlines. No map by which GM employees, suppliers, shareholders and stakeholders of every stripe could chart the company’s progress towards recovery– or lack thereof.
In other words, GM’s current management team has never been held accountable for its actions. This is, perhaps, the single largest failing of what was once the single largest automobile manufacturer in the world. That GM’s Board of Bystanders could keep Rick Wagoner in power through such an enormous slide in market share and profitability, that they let the company’s stock price determine Wagoner’s longevity, is a tragedy of epic proportions– that will ultimately be revealed.
Meanwhile, on Tuesday, more bad news. General Motors Executive Director of Market and Industry Analysis Paul Ballew will take journos for a spin around the dance floor. He’ll talk about foreign expansion and tell the press not to pay any attention to the men behind the curtain. Men who will continue to run GM with self-deceiving incompetence, safe in the knowledge that that they can do so without personal consequence.
The press will treat GM’s failing management with no more disdain than Mr. Healey heaped upon the under-developed, incomplete Chevrolet Tahoe hybrid press vehicle. They’ll note Wagoner’s faults and once again describe his turnaround plan “a work in progress.” Only it isn’t.
You know Mr Farago that the North American Press and some people will swallow anything to convince themselves that we dont need Gasoline powered vehicles anymore and that GM is taking the lead, such fools we are!
It all looks so good at the time!
There have been a couple of technologies marketed and sold as “hybrid” in the last few years by GM… none of them are a true hybrid with any kind of real-world usability. It’s just the orchestra playing while the ship goes down.
-Jeff
http://www.DrivingEnthusiast.net
I understand the mess that is GM. However, the hybrid Tahoe test driven by the USA Today writer was apparently a preproduction example. Are these “test mules” not usually a little rough around the edges? I’ll say this though. If I’m presenting my product to the national press, I’m making sure the bugs are worked out.
DT
1169hp:
If I’m presenting my product to the national press, I’m making sure the bugs are worked out.
Amen.
They have hired Rush Limbaugh as a spokesperson. Rush Limbaugh!!! What idiots.
It always pisses me off when I read reviews of “pre-production models”
Any issues or concerns are merely excused with “Joe Blow says this issue will fixed in time for production.”
Think what would happen if a chef gave out undercooked pork to a restaurant critic; passing it off by saying “Trust me, its much better without the salmonella risk!”
The very idea of a Hybrid Tahoe is laughable. SUV hybrids can be done, but they need to start with a more efficient platform right from the get-go (ie Ford Escape or Lexus RX400h).
Right on, it seems that b/c GM’s brush with death isn’t as acute as Ford or Chrysler’s the Detroit establishment still rules over there. Shame. GM’s products are arguably the best of the Domestics right now, but its systemic problems remain. At least we see the light a the end of the tunnel management-wise at Ford & Chrysler. I just hope they have enough time to make it.
# NickR:
July 29th, 2007 at 8:32 am
They have hired Rush Limbaugh as a spokesperson. Rush Limbaugh!!! What idiots.
It makes sense. They are getting beaten badly on the coasts and in danger of losing the rest. Which states are red and which are blue? They want to hold onto their last good market.
One of the first things they teach you at business school is that in order to reach your goals, they need to be defined and quantified.
There are enough MBA’s working in GM that must know this that Wagoneer couldn’t get away with not having concrete goals. Of course, revealing these to outsiders might create unrealistic expectations of the company…wait what?
It’s clear the targets Wagoneer and the company set out for themselves have been missed and we are seeing a scramble to do anything that might help recover. Considering the trouble GM was in when the economy was doing great (and that we appear to be entering a cyclical slowdown – to put it mildly), I don’t see how things can get better.
I thought the most notable fact was the 2,000 lb. reduction in towing capacity. Towing seemed to be the only reason to purchase this vehicle over the Acadia which achieves similar or possibly superior fuel economy, has a flat-folding 3rd row, more cargo capacity in every seat configuration and presumably a much lower price(per Lutz’ comments).
” Current management has never been held accountable”
No arguement here.Lack of accountability like another substance flows down hill till it gets to the plant floor.At that point us low lifes on production,and our direct supervisers are more than accountable.
We are the ones that pay the price, for the eneptitude at the top.
Correct me if I’m wrong (which I probably am!), didn’t GM have hybrid technology along with Toyota and Honda, but shelved it because “there wasn’t a viable way of marketing it profitably”? So why are they struggling to get a hybrid to market?
But like Mr Farago says, it all smacks of desperation. Which believe it or not, is a good thing. Maybe the message has finally got through to GM management (albeit, 2 years, too late!). Despite what other people think, time is running out for GM and they need to find a direction to take the company (be it chapter 11, chapter 7, a new life as a smaller, more efficient company or as it is right now but put more work in its products).
The press do look on GM’s management with a lot of distain (as do we, which is why the deathwatches are written), but let’s play Devil’s Avocado (joke) what have GM’s management actually done to warrant some kudos? What have GM’s bosses done to move the company forward? I don’t mean laying staff off and squeezing suppliers, because they are all REACTIVE strokes, I’m talking about PROACTIVE moves. Where is this company going? What will it be in 10 years, when the Indians and the Chinese come to play? When the Japanese and the Koreans are locking horns for the title of “Quality Masters of the universe”?
I’d like to think they’ll still be there, but I strongly doubt it will be as a major player. Probably more of a minor player (like, the Renault of the United States).
Maybe GM could form an alliance with a region car maker, maybe Renault and Niss…..oh hang on…..
KatiePuckrik:
“…as it is right now but put more work in its product.”
THAT is GM’s management’s current strategy, and it is the only one of your suggested options without the slightest chance of working.
Mr Farago,
It’s no coincidence that it was the last of my suggestions! ;O)
Of course Wagoneer has plans and goals – the only questions are whether if is trying harder to stem the tide in the short term, and what the *real* long terms are. We don’t about those… what they are, if they are changing, or if they are even realistic given the inevitable (unless the Demos choose to ignore it for Labor reasons) raise of the CAFE standards.
On the Ford side, look at the upcoming launch of the F-150 – a simple re-skinning with the same engines (new V-8 engine not yet ready and delayed; new truck V-6 DOA due to financial issues)). What a glorious time the launch of a new F series used to be… and how hollow it will be now. Not enough product, and at the wrong time.
“What have GM’s bosses done to move the company forward?”
I can only think of 2 things. 1) On Star. 2) Pontiac/Buick/GMC merged into a single sales channel.
On star is a great feature, and though others are coming up with something similiar, On Star is the leader in this type of service. On this, GM has been ahead of the rest. Well ahead. For a while they were licensing it for use by other manufacturers.
Organizing P/B/GMC into a single sales channel hasn’t shown much yet, but it’s an enormous step in the right direction. If taken the logical conclusion, it will mean Pontiacs will be perfromance orieted, Buicks will be near luxury, and GMC will do trucks and SUVs. The three can be kept distinct because the same dealer can sell all 3 brands. It’s a step towards making the brands stand for something, and be distinct from one another. It doesn’t solve the problem of $30K chevies, or $30K Caddies, but hey, it’s a step. It also leaves one wondering where Saturn fits in – somewhere between Chevy and Buick. (They used to have another division in that slot – Olds) I wouldn’t be suprised if they drop the ball on this, but at least it has potential to start sorting out the brand identity problems at GM.
“Despite what other people think, time is running out for GM and they need to find a direction to take the company (be it chapter 11, chapter 7, a new life as a smaller, more efficient company or as it is right now but put more work in its products).”
Oh it will be a smaller compnay in 10 years. A good bit smaller. It’s not done loosing market share yet.
As good as OnStar is, the revenue amounts to nickels and dimes when it comes to supporting a large, correction, bloated manufacturing operation. GM needs a quality product that’s reliable and makes a decent profit. And it needs to sell in numbers with 6 figures a year instead of 4 or 5.
Let’s not take away from the decent products the General is now pitching, which is a reason to cheer. It is hard, though, to ask unions for concessions when upper management is so clearly inept and not willing to share the pain, even symbolically. Which is all the more tragic because unions concessions are necessary.
but let’s play Devil’s Avocado (joke)
Let’s try and find a pancreas for all of GMs ills.
(Sorry, I had to, one of my classmates in MBA school said that in class. I think it was the highlight of my 2 years…not counting the female undergrads).
Speaking of which, I interviewed with GM and Ford after graduating. Dismiss it as sour grapes if you will, but I don’t think I interviewed with a single person who was a ‘car guy’ and the two people they did hire were a guy from ‘cars as appliances’ school of thought and a girl who didn’t give a rat’s ass about cars. They were hired into marketing.
I would be sorry to see GM, Ford, or Chrysler go, but you could squeeze the sympathy I feel for them into a thimble.
“If I’m presenting my product to the national press, I’m making sure the bugs are worked out.
Amen.”
+1 – And I’m Atheist.
The big old push-rod V8 is going to self-destruct with all that startin and stoppin it will be doing. “Shudder” is the least of the problems not to mention $10K (actual) for a lousy 4 MPG increase.
Does anyone else get the impression that it is high-margin Trucks and SUVs or die at GM? This is why GM lacks a plan because there are none that will work with the debt-load they carry. They could put a gun to our collective heads and force us all to buy fully-loaded Suburbans/Escalades at MSRP…That would me my plan as CEO (My cousin Vinnie “The Bull” will be my director of sales and marketing). GM needs to focus on markets outside NA.
Ahh what the heck…GM is doomed.
“it must be said that Rick Wagoner has never set benchmarks for GM’s turnaround. There have been promises and plans aplenty, but no hard and fast publicly declared targets and deadlines. No map by which GM employees, suppliers, shareholders and stakeholders of every stripe could chart the company’s progress towards recovery– or lack thereof”
I am sure they have benchmarks but they refuse to make them public becaue they refuse to be held accountable. If and when GM goes under, I believe the board of bystanders will be more responsible for this than Rabid Rick and company as they have the ultimate responsibility.
Ironically enough ch 11 wil destroy the shareholder value and these clowns while they have never held management accountable by replacing them will in all likelyhood sheepishly vote in favor of ch 11 when it is presented to them by management
“Any issues or concerns are merely excused with “Joe Blow says this issue will fixed in time for production.””
This kinda reminds me of that [idiotic] hollywood movie “RoboCop” where the robot blows-away the the dude at the demonstration and the corporate sales flunky states “It’s just a software bug, we will fix that”.
I’ve mentioned in many posts before, that I think that Carlos Chosn is a very overrated CEO, BUT he does have some principles which GM could do well with.
1: In the Nissan turnaround, he set high (but not unobtainable) targets and told managers responsible to meet those targets. If you set you bar too low, it’s no good, and if you set your bar too high you’ll demoralise your staff.
2: He eliminated unnecessary staff which padded out the responsiblity of the manager in charge of the department. That way, the manager WAS held accountable for the department and not a bunch of consultants.
3: Bonuses where directly linked to targets being met. Recently, a big target was missed at Nissan and Ghosn said “Forget about your bonuses” .
4: Ulitmately, Ghosn laid out parameters which made Nissan transparent to show there was nothing to hide. It was this principle which got the unions co-operating with Ghosn to make lay offs and redundancies to save Nissan. In the end, Nissan became so successful, they hired the majority of people BACK!
In turn, GM could use these principles of management to show people they are serious about turning around. Let’s face it, this turnaround isn’t exactly “swift and savage”, more “cumbersome and gentle”. Another trick GM’s bosses could do, is study German and French manufacturers to see how they work with their unions (you think the UAW are militant? Check out a French strike/protest!*)
But the problem is all of these tips and tricks all hinge on one fundamental principle, that GM’s bosses are willing to change and adapt. How much evidence have we seen of that……?
* When French farmers were angry that British lamb was killing their market (they casually glossed over the fact that British lamb was more tender and higher quality!) and cuts in farm subsidies, they didn’t just hold up some placards. They blocked the ports and set fire to the lamb and the trucks they were in! I’ll say that one more time, they blocked the ports and they set FIRE to the lamb and the trucks they were in! It’s still unclear to this day whether the lambs were dead or alive before the fire. I’m praying they were dead!
“I thought the most notable fact was the 2,000 lb. reduction in towing capacity.”
I wondered about the towing capacity. Why would I spend huge bucks for a Tahoe Hybrid when a Lambda becomes a much better value. The Lambda will probably do better at towing.
The only V8s I would trust with high start-stop duty cycles is the new Toyota “UR” series (4.6L, 5.0L, 5.7L) used in the Tundra and Lexus LS500 hybrid.
Luther: “This kinda reminds me of that [idiotic] hollywood movie “RoboCop” where the robot blows-away the the dude at the demonstration and the corporate sales flunky states “It’s just a software bug, we will fix that”.”
Hey Robocop was set in Detroit so its appropriate
Let’s just watch the show unfold:
http://z.about.com/d/gocalifornia/1/0/s/I/tomb-gallows-at.jpg
Yes, one day there will be a documentary entitled “Who Kill General Motors?”, and the conspiracy theorists will (rightly so) point to internal sources!
Perhaps GM isn’t in quite enough trouble yet, as Ford appears to be.
This is noteworthy as Robert compares the leadership styles of Mullaly and Wagoner, with the implication that one is getting down to work and the other is not or will not.
Katie:
I was living in Paris during the farmer strike. I was also in Moscow (On business) when Yeltsin got up on the tank.
I felt safer in Moscow!
The French just love burning things, Don’t they?
GM is done. The VEBA will cost too much and their cars aren’t good enough. It’s striking to me that this is, overall, a good time to be an American manufacturer since the dollar is so weak… but Detroit doesn’t make cars domestically for export markets. This is partly because their costs are so high, but mostly because they haven’t positioned themselves with flexible manufacturing that can accommodate export models. BMW does this, and now they are shifting more production to their American plant. If Ford could produce Mondeos in NA, or if Mondeos and Fusions were one and the same, they would be getting a boost now from the dollar. GM is doing the exact opposite thing with the Astra. Inexplicable. It’s not like the weak dollar “snuck up” on us.
Mondeos and Fusions (aka Mazda6 “version 2”) are not related at all. And, worse, the new Mondeo wasn’t designed to N.A. required standards. It’ll have to be another generation, another day… always something further and further out for Ford.
Just like the mythical “world rear wheel drive platform” from Australia – it’s potentially some future all-new generation of the Falcon that is about to come out in a few months. Said Falcon is just a reskin of the current model that has no possibility of coming to N.A. or of being used as a platform for anything else. Sad.
So if Ford truly has a global plan, it can’t be realized for several years.
-Jeff
http://www.DrivingEnthusiast.net
You can say a lot of things about the General, but the General has some smart engineers working for him still.
A V-6 Fusion gets what, something like 29 MPG highway, and a V-6 Impala gets 31? If you don’t drive like a maniac, it is easy to beat the EPA highway number in actual highway driving, and I talked to a machine tool service engineer who claims getting 33 MPG in his leased Impala he uses for service calls. It seems like the General is one step ahead of Ford and Chrysler is knowing how to tune engines and transmissions for gas economy.
The pushrod GM engines get maligned for not being DOHC and all of that, and they are described as “agricultural” (my poppa has an IH 584 with the 4-cyl DI Diesel, and boy can that puppy pull). Maybe pushrod engines are passe and GM engines don’t make the melliflous DOHC roar, but they have good horsepower ratings, and GM was getting some of the best V-6 gas economy as anybody until that new Toyota 3.5 came along.
While those sales numbers are not enough to keep GM afloat, GM sales of the Impala are in the Camry-Accord territory on volume – can’t say that about any Ford or Chrysler sedan.
OK, the Tahoe hybrid. The two-mode hybrid is the real deal – two electric machines and planetary gears and no conventional transmission as the Toyota Hybrid Synergy drive. The GM-Chryslet two-mode transmission fits the two electric machines and gear sets in the space of a conventional RWD automatic transmission, which is a big deal putting out hybrid trucks without having to go for clean sheet of paper designs like the Prius.
As far as the BAS being a fake hybrid, what is wrong with exploring the territory if a “mild” hybrid is more of what the customer wants; in the Aura, the Greenline is essentially the 4-cyl Malibu with extra EPA numbers.
But the two-mode is the real deal; what makes it two mode is that it has two planetary sets instead of the single one in a Prius, the effect is to trade off more gears for lighter and less expensive electrical machines to do the same thing.
On one hand, the General is a master of optimization — those pushrod engines are not your father’s pushrods, and they have benefited from 3-D fluid modeling on supercomputers to get more air through them. The General may hit a home run with the two-mode hybrid truck after applying their optimization wizardry, and they will have something that neither Ford, Chrysler, nor Toyota or Nissan have.
On the other hand, the General is famous for technological arrogance — aluminum engine without cylinder linings, the whole Wankel engine episode where the engines were supposed to be so simple that their transmission division could make them. The two-mode hybrid could lay an egg, although this is the same hybrid system used in the new hybrid buses that seem to be doing OK.
As to the Tahoe hybrid being too expensive, the hybrid has always been about making a statement than economics, or at least until recently when Toyota has ramped up hybrid production that they are actually in stock on dealer lots. That the Acadia has the same towing capacity as the Hybrid Tahoe without the hybrid system seems like the sensible choice, but a lot of consumer choices automotive are about passion instead of cold reason.
Yes, GM is desparate and desparation could cause them to push the Hybrid Tahoe to market before it is ready and end up with another GM disaster. But technologically speaking, the two-mode hybrid is up their with Toyota is sophistication, and I wish GM every success with this thing for the sake of advancing hybrid tech in not saving GM.
theSane:
July 29th, 2007 at 9:20 am
# NickR:
July 29th, 2007 at 8:32 am
They have hired Rush Limbaugh as a spokesperson. Rush Limbaugh!!! What idiots.
It makes sense. They are getting beaten badly on the coasts and in danger of losing the rest. Which states are red and and which are blue? They want to hold onto their last good market.
Only in the most superficial analysis does that make sense. This is clearly some idiot at GM pushing his personal politics on the rest of the company.
– The truth is, all states are purple, from a sales perspective, and Democrats are as likely as Republicans to buy GM products. GM can’t afford to lose half their buyers over politics. There are hundreds of celebrities who would be both less polarizing and more universally appealing. If you hire a political celebrity from either end of the spectrum, you’re losing sales, and pretty much forever.
– For all their flag waving, the Republicans have hated, hated, hated the Big 3 ever since the Carter administration helped save Chrysler. The Democrats (the people least likely to listen to ol’ Oxycontin Viagraugh) are the sympathetic ones, although that sympathy may only go as far as the Michigan state border, due to the fundamental incompetence of Detroit management.
” -The truth is, all states are purple, from a sales perspective, and Democrats are as likely as Republicans to buy GM products. GM can’t afford to lose half their buyers over politics. There are hundreds of celebrities who would be both less polarizing and more universally appealing. If you hire a political celebrity from either end of the spectrum, you’re losing sales, and pretty much forever.”
I’ll be less likely to look at GM products now (just did a google search and listened to the Limbaugh commercial) and I was rooting for them.
Compare and contrast Nancy Pelosi’s initial liberal blathering about how she’s gonna change the whole world and impeach the administration with the reality she and most liberals come up against when they focus on mileage/emissions: the liberal idealism & all the green naivety are 100% smack dead against what Detroit and labor wants.
So instead Nancy takes us thru a whirlwind of changing agendas from illegals thru health care, back to the war again, and anything else but. Leaving the CAFE mileage debate delayed until the fall just when it was moving very quickly towards what Detroit and Labor don’t want.
More proof that American companies are run by overpaid clueless MBA’s.
NickR:
“They have hired Rush Limbaugh as a spokesperson. What Idiots!!!”
Not at all. Rush has a large audience, larger than say the CBS Evening news with Katie Couric. And this is one of the most in the know and affluent audiences in any media.
They should have made this move long ago.
Or maybe they should advertise on Air America, or some other hysterical liberal show with no audience? (e.g. MSNBC, Chris Matthews, etc.)
BTW, they are also advertising on Sean Hannity and Laura Ingraham, as well.
All part of the vast right wing conspiracy.
Slightly off topic, but, if Mulally really saves Ford, he will go down in history as one of the greatest CEO’s of all time. Nice of Waggoner to not be giving him any competition.
The real tell is just what RF points out – lack of objectively definable goals. That tells us that the whole org is all about politics, not results.
Speaking of politics, anyone think that the CAFE standards may be affected by how nice the 2.8 play with the UAW? As it is, both companies really need their trucks not to count against thier cars, or they might as well die now. The only thing they make at all well are trucks.
If there is no money. no time. what can save GM? right! Passion! How can you get passion from primitive, arrogant half educated executive sharks whose only vision is headed greenback-wise?
take those manured pitchforks and send them to hell. hire the poor one! The one, who hasn`t tasted blood. did I mention passion?
…did hire were a guy from ‘cars as appliances’ school of thought and a girl who didn’t give a rat’s ass about cars.
Actually, that makes sense to me. After all, they need to sell their cars to customers with precisely those attitudes. Not everyone has gasoline in their veins. But most everyone needs a car sooner or later.
yankinwaoz- but gasoline in veins is exactly what gives a thorough attitude towards making cars. gasoline in veins gives the sense of achievement and detailing. it is gasoline in veins of japanese engineers, that makes them excel, not the paychecks that are offered. love for the cars, is what makes you want them perfect. the love makes the precision and being proud of being the best. Everyone talks about japanese car phenomenon, noone talks about CEO`s big bucks accounts.Why? Because creation is about achievement, being rich -just satisfying your basic instincts. for the love of the game- look at Michael Jordan, Michael jackson, Jacques-Yves Cousteau. To sell a car is like sex. To make a car is like love. Both have value in GDP. Where do you stand?
jurisb you are correct. There are too many alive today that don’t know and don’t want to know of the burden that comes with love. Until we reject the feel good consumerism and quickie satisfaction that comes from our next product fix we are doomed to more of the same. Hell I am sad to say that our country seems to have given up on the will to fight despots, especially when it interrupts our supply of feel good news. GM, Ford and Chrysler may have the opportunity to show us how to rescue
ailing industry in the new global economy. I sure hope so for all our sakes.
So there are people making really good wahser/dryer combos who are passionate about laundry machines? I don’t think so. Great refrigerators are made by people who are passionate about cold food storage? I don’t think so.
Another thing which people forget (or seem to forget) is that from GM’s perspective, the competition isn’t just limited to the imports (VW, Toyota, Honda, Hyundai, etc) they’ve also got competition from Detroit, too. Even though, they’re all in the same boat, they’ve still got customer which they would more than happy to steal from each other.
So let’s run with a hypothesis. Let’s say that GM, Ford and Chrysler’s products appeal to a market demographic which the imports can’t match (let’s say the people who refuse to buy imports for patriotic reasons). This would be a market segment which GM could grab sales from Ford and Chrysler. But the real question is, who’s products are superior in Detroit? Each of domestics have the same perception problem and the same “I don’t want an orphan” stigma. So what do their products say about the company? Who’s maing the best effort to appeal to this demographic?
If anyone is confused, my point is this. I’m taking a scenario where there is no other competition other than the big 2.8 and seeing how their products stand up against each other. This is a perfect appples to apples scene, because if you introduce imports into the equation, you have things like the “so called” perception gap and someone’s individual tastes for something exotic, etc.
So remember, GM aren’t just fighting Japan’s big 2.56, they fighting the remainder of the United States big 2.8!
“So remember, GM aren’t just fighting Japan’s big 2.56, they fighting the remainder of the United States big 2.8!”
True, but I don’t see that any one of the D3 is clearly above the others. (except maybe that Chrysler always has less on offer) I don’t think they take market share from each other so much as they loose it to the transplants. If one of them could really improve quality by a remarkable degree, they might be able to take share from the other two.
Where I live, people who buy American mostly buy GM, but this is a GM town. We used to make Oldsmobiles here. We still make other GM cars here. If we didn’t have GM plants, I don’t think there’d be any preference over Ford or Chrysler.
Let me offer another perspective.
The top management of GM knows exactly what to do to turn things around and how to do it. They’ve been given the information time and time again by consultants that they happily pay millions every year for their “expert” advice. Then they summarily ignore it.
One part of the advice they are given is how to influence and change their culture. If, for example, they wish to have a culture that is customer-focused, they will hire people with certain life attitudes and outlooks, and give compensation that is appropriate for that level of competence. If they desire to have a culture that is inwardly-focused (“I know the Aztek looks good because it looks good to me!”), then they hire (or retain) people with those perspectives.
It’s obvious the path they have chosen and continue to take.
The fragile and often broken relationships between GM and their customers are confusing to GM’s management because of the positive press and feedback they get in Michigan. They see all of their friends drive large SUVs, tows boats up north, be unconcerned about gas milage, and be generally suspicious about foreign products. It’s almost surreal driving into Michigan and seeing the dramatic shift of foreign/domestic brands and talking with the locals about their views of cars, trade policies, and such.
I think someone had mentioned it here before. For a dramatic shift to happen in the GM culture would probably require for GM management to get out of Michigan. There’s too much of a “support” structure that allows them to think they are doing the “right thing”.
I remember reading the catastrophic book detailing Packard’s demise a year ago, and James Nance (who took over Packard then bought Studebaker – the fool) commenting that when he hired “big 3” executives to help in the turn-around of Studebaker-Packard, they couldn’t take the heat in the kitchen. This was over 50 years ago. Some things never change.
Glenn 126:
What was the title of that Packard book?
Luther: “This kinda reminds me of that hollywood movie “RoboCop” where the robot blows-away the the dude at the demonstration and the corporate sales flunky states “It’s just a software bug, we will fix that”.”
Verhoven’s film was genius in its use of tongue-in-cheek satire (love the news/commercials) and vision of future corporate-run dystopia.
Zarba, here it is. “The Fall of the Packard Motor Car Company” by James A. Ward
http://www.bookfinder.com/dir/i/The_Fall_of_the_Packard_Motor_Car_Company/0804731659/
Read it and weep – for the big 2.8 are going down this ill-fated road right now as I type this.
Surely we will follow the UK in no longer having an auto industry of our own of any consequence, if current trends continue.
jwfisher:
July 29th, 2007 at 10:29 pm
Compare and contrast Nancy Pelosi’s initial liberal blathering about how she’s gonna change the whole world and impeach the administration with the reality she and most liberals come up against when they focus on mileage/emissions: the liberal idealism & all the green naivety are 100% smack dead against what Detroit and labor wants.
Correction: Nancy Pelosi (to her detriment, IMHO) has said from the get-go that impeachment is, quote, “off the table.”
Are people spelling Rick Wagoner’s name “Wagoneer” on purpose? If so, that’s hilarious. Kind of like he’s too large and has too much fake wood on his slab sides to be running GM….
fallout11:
July 30th, 2007 at 10:14 am
Luther: “This kinda reminds me of that hollywood movie “RoboCop” where the robot blows-away the the dude at the demonstration and the corporate sales flunky states “It’s just a software bug, we will fix that”.”
Verhoven’s film was genius in its use of tongue-in-cheek satire (love the news/commercials) and vision of future corporate-run dystopia.
I loved that the car the cops drove was a Potiac 6000 SUX. Great film.
It would be great for GM to move to a more inspiring state to work in, and for everyone to get a real world perspective of whats going on. Well at least the upper managment, most of us regular joes know whats going on but many at all levels are still blinkered. Trouble is with their current financial woes, they could not afford to do that and history is just too strong for the Auto makers in Detroit.
I was never bothered by the deathwatches, it was quite fun reading them knowing the things only us insiders know of future sheet metal and how the company was doing, but for some reason the last couple have struck a nerve with a few insiders, interesting scary times ahead for those in the industry. Survival of the fittest etc, wheres my running shoes i better get in training.
Sorry Paul M. need to disagree with this-“Maybe pushrod engines are passe and GM engines don’t make the melliflous DOHC roar, but they have good horsepower ratings, and GM was getting some of the best V-6 gas economy as anybody until that new Toyota 3.5 came along.”
I started to notice several years ago road tests did not reflect the “slower but frugal” mantra used to defend the GM two valve V-6’s (I think pushrods are not the issue).
I compared HP, road test MPG, and vehicle weight on approximately 30 GM, Honda, Toyota and Nissan V-6 powered vehicles 2-3 years ago. Only the Avalon had the 3.5 at the time. I included cars SUVs and vans. All of the Japanese engines averaged much higher HP, no surprise.
Honda stood out with the best MPG with Toyota (in 3.0 & 3.3 giuse) second. Nissan and GM were seperated by tenths. The GM vehicles actually had the lightest average weight also as the Tyondassan uses V-6s in larger SUVs and there Minivans were heavier.
The GM two vavle V-6 is slower, weaker, thirstier. Oh, and cheaper.
I think it is clear why it still exists.
In mid-size cars some 4 cyl will run right with or ahead of the 3.5 GM cars which deliver mediocre milage for sixes (and more NVH).
Neat, power of 4 with the mileage of a 6.
What are they thinking?
Why are they sinking?
Take care,
Bunter
Cavendel:
6000 SUX was based off an older Cutlass Supreme.
Pic: http://robocoparchive.com/info/car8.JPG
Starlightmica:
Yeah, but the moniker SUX just doesn’t say nice things about the Pontiac wheels of the time.
When I saw the car in the movie, my first thought was that Ford was sponsoring the movie.
Has it ever occurred to anyone that GM’s “mild hybrid” system could save a lot of fuel, even in a gas-guzzling Tahoe? Think about how much less gasoline we’d use if all cars & trucks had a system like this, which basically eliminates engine idling. No, it may not enable you to get 30 mpg in a Tahoe, but it most definitely could collectively save a lot of gas – according to http://www.thehcf.org/antiidlingprimer.html , about 3.8 million gallons/day in America alone if every car was equipped with this technology.
By the way GM just posted profits for a 2nd quarter…$891million, thats not a bad thing unless you’re negotiating with the UAW. Still, work to be done but at least the report cards looking better. Hope springs…
Yes – a few dollars made by reducing costs, not by increasing sales. Easy money – not a sign of health. Same thing for Ford.
Of course Gettelfinger is yelling “gimme gimme gimme” now because of this.
@jdizzle – Sure, we could save 3.8 mil gal/day if all the Tahoe’s out there were the new hybrid. But, there isn’t one production hybrid Tahoe on the road yet, and just because GM rolls it out the door doesn’t automagically mean all the others will get improved mileage by not idling. The existing ones will be on the road a long time, and very few people are going to trade in their existing one on a new one just to get 4MPG better. Even if they do, the old one will be sold to someone else, not crushed.
Yes, over time, more hybrids on the road will mean less gas consumption, but it’s going to take a long, long time. Consider that the average new car is designed for about 100k miles before needing a tune up, that’s upwards of 8 years for the metal limping off the lots today. Even when these vehicles are traded in for the hottest new hybrid/diesel/E85/Mr. Fusion powered wonder of the future, they’ll still be sucking down gas at their current rate, or greater as they wear.
Yes! Boston tea party.Whats the down side of 891million profit? I sure hope Ron G. got his morning paper.
I agree hope springs.That makes 3, 1/4s in a row.
Maybe just maybe!
Let’s review the facts of the day: a profitable quarter, $1B in positive cashflow and strong revenue growth globally, except in the stagnant US market. Analysts are pleasantly surprised, the stock is up and the odds of default continue to drop rapidly.
New Death Watch up later today.
Can’t wait