Forbes‘ former GM Kool-Aid drinker, Jerry Flint, has finally cottoned on to the fact that GM is going to hell (and not back). The Ascot-Wearing One sees today’s announcement that the nationalized American automaker is selling its Opel brand to a Canadian-fronted Russian mob as a harbinger of doom. (Substitute the words “yet another” for “a” and you’re there!) “Opel, and the cars made in Britain under the Vauxhall name, account for more than 1 million sales a year, but the operations are more important that the sales. The German unit is the heart of GM’s car engineering, and particularly the creation of front-drive cars and compact-size cars. U.S. models are derived from these cars, such as today’s Chevy Malibu.” Oh, no! No more world-beating Astras? Hang on, isn’t Daewoo engineering GM’s small cars?
Anyway, to quote Mr. Faulty, just don’t mention the war . . .
Of course, GM will have agreements; the new Opel, controlled by others, will pledge to continue to cooperate, share, coordinate and work with GM in developing cars. That’s what the agreements will say. Unfortunately, the world doesn’t work like that. The Germans will be happy to snub requests from Detroit GM, put them on the back burner and ignore requests to design with the U.S. in mind.
The Germans at Opel have been sticking it to the Americans whenever they could for years. At times they have rejected direct orders from the Detroit headquarters. One of GM’s highest executives once told me he considered the old Opel board to be “traitors.” Now the Germans have their chance to really stick it to their old owners.
They disobeyed a direct order? That doesn’t sound particularly German to me. But as much as the prospect of the Germans controlling GM’s European outposts rankle Jerry (Flint, not the Germans), the concept of Russian involvement is, apparently, worse.
My experience is that the Russians don’t take a back seat to anyone, and dealing with the Russians has been a losing game for more than one Western partner. If the deal is successful, they have been known to steal the assets through their corrupt courts.
Perhaps I have a personal grudge. I examined the Russian auto industry for Forbes magazine in 1996. Later, my writing partner, an American who headed Forbes magazine in Russia, was murdered on the streets of Moscow.
Just because Jerry’s pissed off and paranoid doesn’t mean he’s not right on this one. But he’s missing the wider point: it’s time to go. The artist formerly known as the world’s largest automaker is no longer a force with which reckoning should occur. Unless you reckon thusly:
Opel has been a money loser for GM and is shrinking, but it’s reasonable to believe that is due to incompetence.
Absolutely. But what would change—have changed—with a New GM-controlled Opel, exactly?
I agree with Flint in the sense that the engineering in the US has been hollowed out. Only trucks and a few more expensive models (CTS, Corvette) have much real engineering content provided by the US part of GM. The Daewoo-engineered small cars have been underwhelming. The loss of Opel will eventually mean one of two things – either GM brings the engineering back to the US (unlikely) or Daewoo takes over more engineering (likely). I never understood Germany (and Opel) as an economical place to do engineering – at least they did do decent engineering – but cheaply? I guess there’s Holden (Australia) but their expertise has been in RWD cars.
At times they have rejected direct orders from the Detroit headquarters. One of GM’s highest executives once told me he considered the old Opel board to be “traitors.”
I believe the reason they tended to do this is because GMNA was proposing something that was either:
a) Stupid
b) Inappropriate for Opel’s market
c) Would leave Opel holding the bag in terms of cost
d) All of the above
I wish I could find examples, but I recall that there were issues with supplier relations, the Delta platform and intellectual property in the past.
Isn’t it the other way around? GM Europe being hamstruck by incompetence from the Headquarters back home? Money in the billions flowing from Europe to fill the empty coffers in Detroit?
Secondly, GM is keeping 45%. Why didn’t they sell the whole shebang? That post will only stop New Opel to progress independtly in the right direction. Thirdly, the next time GM gets cash strapped, they will use that post as leverage to extort money from Germany. Either an upright extortion, or use the 45% as collateral, or sell it in its entirety if they are really forced. Why just not be done with it, and move on?
@tced2:
“I agree with Flint in the sense that the engineering in the US has been hollowed out. Only trucks and a few more expensive models (CTS, Corvette) have much real engineering content provided by the US part of GM.”
Remind me, when was the last time GMNA designed and engineered a really good small car? In my opinion, they have never EVER done that thing right.
@tced2 :
I could be wrong here, but aren’t the RWD Holdens based on the old Opel Omega platform?
@psarhjinian :
I agree. The reason why the people over at Opel are so hostile towards GM is because they feel that the decisions made in Detroit did nothing but harm Opel.
@tom,
May be. I don’t know the lineage of all these platforms.
@Ingvar,
GM never treated small cars seriously – the engineering was second-rate. GM wanted to sell you a “real car” – Buick or at least a full-size Chevy where the profits were.
I would suggest that some of the animosity of Opel towards GM North America is the same problem Chrysler had with Diamler. There is an air of superiority (deserved or not) by Europeans. (I would add in the end, Diamler doesn’t know how to do $20k or $30k automobiles – where Chrysler needed to succeed).
I used to work for a company (not-automotive) that had European management/ownership. We (US headquarters) were often treated as second class citizens even though we were doing first-class work. At the worker level, the work was very congenial – but at the managerial level there was definitely a bit of a air of superiority.
“I used to work for a company (not-automotive) that had European management/ownership. We (US headquarters) were often treated as second class citizens even though we were doing first-class work.”
Well, I can understand that. Germany is perhaps the most quality-oriented market in the world. If we leave the question of percieved vs real quality aside, there’s no question that the Germans build high quality products. The problem is, both Opel/Vauxhall and Ford Europe has always been in the bottom of the scale, even in Europe. I can understand the feelings of frustration always being looked at as second rate. And I can understand the animosity forwarded to a headquarter with even less expectations than that. It wasn’t until the end of the nineties that Opel pulled itself together, due to the formidable tour de force the fourth generation Volkswagen Golf was.
Hey they could end up naming the newco as Opel-Magna-GAZ or OMG for short. What fun!
“Biggest mistake ever”
I think there is a huge amount of competition for that title.
GM engineering is a worldwide effort, seriously. It is like a plate of spaghetti to try to unwind. Good engineering on all vehicles, large, small, truck, car occurs in all regions.
Having lived the dream of working on globally engineered programs at GM for the past decade, I must say that all regions have their strengths and weaknesses. The most fun I ever had on one part was when one of our JV partners was design responsible for the A pillar up to the B pillar, another GM region had the B pillar, and a third region had the rear door opening to C pillar. Three engineers, three sets of math data, three languages, three time zones, for one part.
@tced2 “I never understood Germany (and Opel) as an economical place to do engineering – at least they did do decent engineering – but cheaply?” Think in terms of foreign exchange rates, which change over time…
one of our JV partners was design responsible for the A pillar up to the B pillar, another GM region had the B pillar, and a third region had the rear door opening to C pillar. Three engineers, three sets of math data, three languages, three time zones, for one part.
That explains a great deal.
According to GM’s info on Opel sales were up in 2008 in Eastern Europe.
http://www.gm.com/europe/corporate/sales/european/opel-vauxhall/
Me thinks GM is burning thru more cash than already given by us taxpayers, thus the sale of overseas brands is needed.
I still enjoy reading Flint’s opinionated geezer pieces every month on Wards on the web, even tho I usually disagree with much of what he claims.
Originally, I too thought it would be a huge mistake for GM to get rid of Opel, certainly when it still owns stupid Buick (in the US; In china, Buick is doing great, as we all know)
But tonight I heard in Autoline after hours that only the Opel insignia is sold at list price there, and all other Opels are deply discounted, and basically, surprise surpise, GM managed to make no profit in another well known brand..
So after all that, I really don’t care what they do.
So … GM engineering is going to be mostly out of Detroit and Daewoo now? Great.
You know Werner Klemperer actually won grammys for his work in Hogan’s. At least he could claim actual success. It is a shame to associate him and that great show with GM or “Gov’t Motors”. That said, nice to see some recognition of an old very good TV show…..
Actually Gary, you are confusing Werner with his dad, a conductor of the Berliner Philharmonic amongst others – a nice Beethoven’s 5th is available on Deutsche Grammaphone – and the son. Emmys – television, Grammys – music. I think they both may have won in their respective categories actually.
Actually, a lot of Daewoo development is done under Opel tutelage. Several of my Opel friends were dispatched to Korea to help out. They’ll miss it ….
Also, if GM wouldn’t have been so penisheaded and moved GME to that great Mecca of European automotive ingenuity – Zurich – and if they wouldn’t have degraded Opel to sub-sub-subsidiary status, while leaving most of their development to Opel, there would not have been that much animosity. You foster creativity by giving credit. You foster dissent by management by champignons: Keep in the dark and shovel shit on top.
CliffG
Actually Gary, you are confusing Werner with his dad, a conductor of the Berliner Philharmonic amongst others – a nice Beethoven’s 5th is available on Deutsche Grammaphone – and the son. Emmys – television, Grammys – music. I think they both may have won in their respective categories actually.
Otto Klemperer’s Beethoven symphonies belong to EMI and they didn’t win any Grammys. Unfortunately.
On the other hand, Karajan’s recordings of those symphonies (for Deutsche Grammophon) won a ton of awards.
@Robert
They disobeyed a direct order? That doesn’t sound particularly German to me.
Well, read Brazilian author Zé do Rock’s excellent book “jede sekunde stirbt ein nichtraucher” then. Wipes the floor with stereotypes like that.
@tced2 :
I never understood Germany (and Opel) as an economical place to do engineering
Why did Hyundai build an enormous engineering center in Rüsselsheim (yes, right next to Opel’s headquarters) then?
GM will only retain 35% ownership of Opel, which will be the single largest shareholder. 27.5% each to Magna and Sberbank (which will work as a block vote so no control for GM), plus 10% to the workers. How many years until this unholy Alliance implodes on itself?
Pressures:
– cost restructuring (i.e. big job losses to come)
– geo-politics (Russian meddling in company policy)
– Sberbank selling their share asap to a less palatable partner
– talented German engineers moving to a safer company (Mercedes need small car expertise and are just 1-2 hours drive down the road – fast Tuetonic tarmac road that is)
– forthcoming European price war in volume auto market is going to play hell with Opel margins/ cash injections
– Magna get buyers regret when other OEMs start to shun them
“Even if we’re not a majority owner of Opel, we’ll still have a significant position in Europe through Chevy,” John F. Smith, GM’s group vice president for business development, said in an interview.
Ummm…yeah, keep on dreaming…
Ingvar :
September 10th, 2009 at 6:12 pm
Well, I can understand that. Germany is perhaps the most quality-oriented market in the world.
Then explain how Volkswagon sells so many vehicles in Germany then?
Good long-term quality, cheap and abundant supply of parts for older models, good dealership service, high dealership density, good management of recalls if they screw something up, high resale value, sympathy for the “home team”… and the fact that many Germans equate “car” with “Golf” and “station wagon” with “Passat”.
It’s the default choice for a lot of people.
@moedaman :
Then explain how Volkswagon sells so many vehicles in Germany then?
Because they’re among the most reliable cars.
Check out this link, it’s the “ADAC Pannenstatistik”. The ADAC is the German version of AAA and they have the most respected reliability reports in Germany:
http://www.autokiste.de/psg/index/show.htm?id=7918&bild=1&mode=
Which makes me wonder where the reliability gap (for VW) between Germany and the US stems from…
Ford Europe has always been in the bottom of the scale, even in Europe.
Having worked for a German company and spending a good bit of time over there, the Germans love Ford, and they will tell you about it (don’t compare an american ford car with a european one), I was suprised that in the parking lot that after VW, ford was second (by a large margin)*.
In the 80’s Opel had the highest rated quality of any automaker in the world (while GMNA had the lowest), that actually sold at a premium to VW and FE, in the 70’s Opel was Germany’s largest automaker. In the 90’s GM managed to destroy this trying to find anyway to fund NA.
* Not including directors and executives, they all had company Audi, BMW or Merc.
psarhjinian:
“I believe the reason they tended to do this [disobey direct orders] is because GMNA was proposing something that was either:
a) Stupid
b) Inappropriate for Opel’s market
c) Would leave Opel holding the bag in terms of cost
d) All of the above”
That’s what I was thinking. Look at the boneheaded moves GM makes in its homeland. Now, imagine you’re the company’s only real player in Europe. You’re trying to make inroads for the corporation on the Continent, but you can’t make much headway with all those American doofuses trying to tell you how to run your company…and oh, by the way, make our crummy American cars more desirable, in between trying to rescue what little good reputation Opel has left in the EU.
Opel had its own challenges and its own audience within the car-buying public. I’m not naive to the reality of car design and building being a world-wide process, but really, who could blame Opel for saying “no” to daddy GM every now and then? It seems like they were doing a sight better than Chevy, Buick, Pontiac, Saturn, Hummer, Saab and GMC when it comes to building a solid brand identity and turning around customer expectations. Maybe Opel wanted to do what all the brands used to do, when they were worth a damn: focus on making itself better than other brands, even within its parent company. Anyone can read stories about the competition between GM divisions back in the day when the saying “What’s good for GM is good for America” really had some meaning to it.
As proof of Opel’s mindset of “Opel Business before GM Business,” I offer the Opel/Saturn Astra. A better GM small car has never graced our shores. It wouldn’t have been as good if GM corporate management had gone to Opel and said “build us an American car, in all your spare time between trying to turn your company around in Europe.” Instead, they cherry-picked a great European Opel and threw it haphazardly (without any marketing to speak of) into the Saturn lineup. Despite GM’s best efforts to let it slide under the radar (why? Did they want it to fail because they have a grudge for Opel and wanted to teach them a lesson?) most of the automotive press and the car’s few buyers have had nothing but praise for the car.
Opel obviously knows what it’s doing. It’s spent the last decade or so making the best of what it’s got. GM would appear to be a thorn in its side. Maybe the Ruskies will behave and Opel will have a little more autonomy– and success– in the Old World.
“Author: tom
Comment:
@moedaman :
Then explain how Volkswagon sells so many vehicles in Germany then?
Because they’re among the most reliable cars.
Check out this link, it’s the “ADAC Pannenstatistik”. The ADAC is the German version of AAA and they have the most respected reliability reports in Germany:
http://www.autokiste.de/psg/index/show.htm?id=7918&bild=1&mode=
Which makes me wonder where the reliability gap (for VW) between Germany and the US stems from…”
EXCELLENT POINT!
Maybe because most US VWs are made in MEXICO or other places other than Germany?
My first car was a passat wagon back in the 70s, a 4 yr old that cost as much to run 10k miles as to buy ($2k, and back then this was real $!)
But our computer person here has a Passat wagon with the 6, put 105k trouble free miles, he told me he only replaced a control arm or sth since 2002, plus regular maintenance. He is Belgian of origin. He explained it by saying that it was built in Germany (and not in MEXICO)
@Autosavant :
Maybe because most US VWs are made in MEXICO or other places other than Germany?
I don’t know… sure, the Mexican-made Jetta is a very minor seller in Europe, because it’s only bought by people who are so old they have to worry more about their own body’s reliability than about their car’s, but you also get the German-made Golf and Passat and the Slovakian-made Touareg…
Maybe because VW has to find a way to make a profit when the $/Euro exchange rate is 1.48/1.
tom: Which makes me wonder where the reliability gap (for VW) between Germany and the US stems from…
Because Germans have lower standards for reliability than Americans do.
This is because they drive less than Americans, and are more likely to receive the car as a job perk, instead of purchasing it outright with their own money (as the great majority of Americans do).
The less people drive, the less likely that problems will rear their ugly head. And if you aren’t paying for the car yourself, you tend to value reliability less and other things (handling, fit-and-finish) more.
Autosavant: Maybe because most US VWs are made in MEXICO or other places other than Germany?
Doubt it. I don’t recall the German-made VWs consistently earning higher reliability scores than the Mexican-made ones.
And note that most Mercedes are made in Germany, and they have had abysmal reliability ratings in this country for many years now.
All European makes sadly troll the lower end of reliability ratings here in the US. The Europeans value quality most. The Americans, in general, value reliability most. They are two different things. How many Europeans regularly drive their cars to over 300,000 kilometers with expectations of little dealer maintenance?
Most Toyota’s, Honda’s, Nissan’s, and some US brand models (usually trucks) achieve this kind of mileage without having to go to a dealer and drop your pants for expensive repairs. It seems there are no modern European cars that achieve this, even though the old Volvo 240’s & Benz diesels clearly did.
@geeber :
Because Germans have lower standards for reliability than Americans do.
If that was the reason, then VW should still be behind the competition in Germany in terms of reliability. Only total numbers of problems would be lower, but not relative numbers. But if you look at the link I gave you, you’ll see that VW is constantly ahead of Toyota, Honda, Hyundai, Nissan, Ford and whatnot…only luxury manufacturers like Audi, Mercedes, BMW are even better…so that doesn’t really answer the question…
Info Update on Werner Klemperer aka “Klink”:
….For his performance as Klink, Klemperer received six Emmy Award nominations for best supporting actor, winning in 1968, and again in 1969.
Site link: http://en.wikipedia.org/wiki/Werner_Klemperer
Also, note the car he drove back then.
Now that GM has lost Opel does this mean Toyota and Volkswagon are now the world’s top carmakers?
GM’s presence in Europe is now going to consist of Chevrolets rebadged as Daewoos!
But if you look at the link I gave you, you’ll see that VW is constantly ahead of Toyota, Honda, Hyundai, Nissan, Ford and whatnot…only luxury manufacturers like Audi, Mercedes, BMW are even better…so that doesn’t really answer the question…
Our surveys consistently place European cars – and VWs in particular – at the bottom of the pack. At the most, the survey proves that Germans have different standards of what constitutes reliability than Americans do, which is probably based on the factors I mentioned in my earlier post.
This is backed up by dealers and mechanics here in the U.S…they will all tell you to avoid European cars out of warranty. Not only are the cost of repairs high, but the car is much more likely to need one than even an American car will.
@geeber :
Our surveys consistently place European cars – and VWs in particular – at the bottom of the pack.
I don’t doubt that. Which is exactly what’s so puzzling…my theory would be that in Germany, the laws regarding which cars are allowed on the street are very strict, while in the US it’s fine as long as it runs.
So the German driver is forced to do regular maintenance in order to be able to still drive his car which means that the average car is probably in a much better shape. And since the German car makers know this, they optimized their cars for this particular system.
But that would only be my guess…there’s probably also something to your point, that the surveys do look differently. AFAIK, the German ADAC report is mainly focused on the need for road side assistance which means actual break downs (I could be wrong though).
I’ve just looked at a customer satisfaction study for Germany done by JD Power. Here VW was actually slightly below average.
But with these studies, I’m somewhat skeptic, since the average buyer probably expects more from a VW than from a Honda (at least in Germany) which means he’s harder to satisfy.
Or put differently, the driver of a Toyota doesn’t care about driving, only about transportation.
Anyway, here’s the link:
http://www.jdpower.com/corporate/news/releases/pdf/2008074a.pdf
Interesting (although kinda expected) how horrible Chevrolet is doing…
The less people drive, the less likely that problems will rear their ugly head. And if you aren’t paying for the car yourself, you tend to value reliability less and other things (handling, fit-and-finish) more.
This is accurate, and it explains a lot.
Just compare the JD Power surveys cited here:
-The European survey is done at the 2-year mark, and includes reliability as a small component of the score.
-The American VDS survey is done at the 3-year mark, and is focused entirely on reliability.
-The average German drives about 8,000 miles per year.
-The average American drives about 14,000 miles per year.
Now put this together: The German JDP survey is generally going to occur at about 16,000 miles, while the US survey is being conducted at about 42,000 miles. The German is more likely to have received the car as a part of a employee-fleet deal than the American, so the former is less annoyed by whatever problems there may be than the latter. The German survey includes many intangible factors, while the US survey focuses exclusively on the one that we’re discussing.
In part, this tells you that most cars are going to be fairly similar for the first 15-20,000 miles. It’s once you get past that point that the differences really start to emerge.
German cars rank highly in terms of perceived quality (look, feel, etc.), but have inferior engineering and build quality compared to the best of the Japanese. A Toyota may feel more sterile, but it is generally a better assembled, engineered and designed vehicle.
Naturally, Americans will care more about the virtues of the Toyota because they are more likely to suffer when those virtues aren’t present. If you don’t drive much and don’t get stuck with paying for it when it breaks, then you can drive what you feel like driving and not worry about the long-term consequences.
I suspect that this is also why Buick tends to do well in the US surveys — they skew heavily toward older owners, who drive as little as do the Europeans. If you drive 6,000 miles per year, then you can probably get away with driving just about anything and not be unhappy with the repair bills.
“Because Germans have lower standards for reliability than Americans do.”
Allow me to retort…
So, you consider lazy double nickel commuting on highways harder driving than what goes on in Europe and Germany especially? All that congested city street start and stopping, all that driving Autobahn at flat out speed? The Autobahn commuters beat the living crap out of their cars, you can see cars in excess of 300 000 kilometres that are only three years old. Some cars are simply used up before the lease is over. Have you ever seen a car in Paris that isn’t dented within the first month of use?
If what You say were the case, the Europeans would only drive American Iron. But it isn’t. And the American cars are considered jokes in Europe. Everything from the Chevrolet Matiz née Daewoo to the Camaro and Hummer crowd. I would say that besides third world driving like in Africa, no other people on this earth drives their cars harder, and no market is as quality and reliability oriented as the European. And that’s why Cadillac sells in the lower thousands, in a 700 million population.
@Pch101 :
If what you said were true, we’d expect VW (and the other German car makers) to do much better in the JD Power survey than in the ADAC statistics.
Mind you, the ADAC uses actual hard data for their statistics. They actually count the number of break downs. They can do that, because in Germany, the ADAC almost exclusively provides road side assistance, either directly to their members (which is the vast majority of Germans already) or via cooperation (with car makers for example). But in any case they have a nation wide infrastructure.
The JD Power survey on the other hand is done by questioning people about their experience. So other factors than reliability play a role. If I drive a Mercedes and the glove compartment rattles, I’m gonna be pissed, while I’d expect nothing else from a Daihatsu.
So if we have a problem regarding reliability, but otherwise great quality, the ADAC statistic should be worse than the JD Power survey. But we see the exact opposite. Volkswagen is doing great in the ADAC statistics and is only bested by luxury car makers. In the JD Power survey for Germany however, VW is slightly below average.
So something doesn’t add up…
Mind you, the ADAC uses actual hard data for their statistics. They actually count the number of break downs.
A lot of reliability problems don’t result in breakdowns. By definition, a survey based exclusively on tows is going to be woefully incomplete.
In many ways, European car buyers are much like Americans of the early 70’s. There is still a good deal of automotive nationalism within Europe, and a lot of denial about the possibility that the foreigners might do a better job. It can take decades for buyers to have their epiphany and buy accordingly.
The fact is that Toyota raised the bar in terms of production management, and only Honda has come close in duplicating the result. Every other maker is still mired in much of the traditional management mindset and production technique that were inherited from the Henry Ford model of mass production, which has put a low priority on quality control and then only at the end of the build process after it is too late to catch most of the problems.
Westerners don’t generally like to admit that they have something to learn from Japan, but they do, and they should. Just because they don’t want to admit to the mistakes doesn’t mean that they aren’t making them.
A lot of reliability problems don’t result in breakdowns. By definition, a survey based exclusively on tows is going to be woefully incomplete.
I know, but that’s the most important part of reliability.
But there are other similar statistics, like the “TÜV-Report” which is based on the bi-annual mandatory check-ups everybody has to go through and which gives similar results.
http://www.anusedcar.com/index.php/tuv-report-year-age/2007-2-3/18
Here the only VW below average is the Sharan, which is a rebadged Ford Galaxy…
Edit: And the VW Lupo which is slightly below average but has been discontinued 4 years ago because it was so crappy…
I know, but that’s the most important part of reliability.
If you’re trying to support Geeber’s position that reliability doesn’t carry the same weight or definition in Europe as it does in the US, then you’ve pretty much done it.
Just because the parts aren’t exploding doesn’t make them “reliable.” That’s particularly true when we’re comparing 16,000 mile cars to 42,000 mile cars, as we are apt to do when comparing the European and US versions of the JD Power survey. A lot can happen between 16,000 and 42,000 miles, and with one more year on the road.
But there are other similar statistics, like the “TÜV-Report” which is based on the bi-annual mandatory check-ups everybody has to go through and which gives similar results.
A “defect rate” is not necessarily the same as “reliability.” Plenty of items that are unreliable are not “defective.” The TUV is a road safety check, not a user reliability survey.
Again, you can try to defend it, but the facts aren’t on your side. The US provides a toughter test for long-term reliability, because people drive more and suffer more when their cars are out of service.
@Pch101 :
Then give me your definition of “reliable”. I’d define it as “time in the shop” or “money you need to keep your car running”.
These statistics reflect just that.
Then give me your definition of “reliable”. I’d define it as “time in the shop” or “money you need to keep your car running”.
A car that is two years old should be under warranty and cost zero money to keep running, aside from fuel, tires and basic maintenance. So no, that’s not a good definition.
We’re already covered that JD Power’s surveys in Europe aren’t just based upon reliability, that Europeans drive less, that the US version of the surveys should generally cover older cars with higher mileage, and that surveys based upon towing or safety-related defects aren’t useful for this purpose. I seriously don’t know what more you could want. You sound determined to defend VW, no matter what the facts are.
The more reasonable question to ask is this: Why is it that those who drive their VW’s more end up with a lot more problems than those who drive less? The logical answer would be that things start to self-destruct on a VW as the miles add up more quickly than they do on a Toyota, Honda, etc..
You sound determined to defend VW, no matter what the facts are.
Believe me, I don’t. I don’t care much for VW to be honest. But VW shows how different the perceptions are in the US vs Europe.
Because in the US, VW is always at the very bottom in reliability rankings, while in Europe they’re on the very top.
Why is it that those who drive their VW’s more end up with a lot more problems than those who drive less?
And that’s exactly what I’m challenging. It’s true for the US, but not for Europe. Here, Toyota does constantly worse than VW in all reliability rankings, at least in the last couple of years. Around the year 2000, Toyota was also topping all lists here, but they have gotten worse while others (like VW) have gotten better. But that doesn’t seem to be the case in the US, where VW is still at the very bottom when it comes to reliability.
And it’s not that Europeans don’t care for reliability either. I mean Opel is the best example. Up until the 1970s, they were Germany’s #1 auto maker and at least up until the early 1990s they were pretty much on par with VW. But then they started to drastically cut costs and their reliability ratings went down, and with them sales.
In 1994, Opel’s market share in Germany was 17%, pretty close to VW. In 2008, Opels market share was 8.4%. Which is even behind the luxury car makers BMW, Mercedes and Audi. The main reason for that drop was reliability.
Pch101: Now put this together: The German JDP survey is generally going to occur at about 16,000 miles, while the US survey is being conducted at about 42,000 miles. The German is more likely to have received the car as a part of a employee-fleet deal than the American, so the former is less annoyed by whatever problems there may be than the latter. The German survey includes many intangible factors, while the US survey focuses exclusively on the one that we’re discussing.
Thank you, Pch101. This is a clear, concise explanation of the different ways that Americans and Europeans approach reliability. I wish I could have summed this up as well.
Pch101: I suspect that this is also why Buick tends to do well in the US surveys — they skew heavily toward older owners, who drive as little as do the Europeans. If you drive 6,000 miles per year, then you can probably get away with driving just about anything and not be unhappy with the repair bills.
I’ve suspected this as well. Plus, most Buick owners don’t push their cars too hard.
I’m always amused when GM partisans point to Buick as proof that GM cars are as good as Toyotas.
Buick, until recently, was using old platforms powered largely by the ancient 3.8 V-6. If car company can’t get decent reliability scores with those building blocks, then it needs to get into a another business.
Ingvar: If what You say were the case, the Europeans would only drive American Iron. But it isn’t. And the American cars are considered jokes in Europe. Everything from the Chevrolet Matiz née Daewoo to the Camaro and Hummer crowd.
Come on – you’re a long-time poster on this site…you know that most AMERICAN cars don’t get much love from posters, or judging by market share trends, Americans in general. The standard bearers for reliability in American are Toyota and Honda.
Except for the diehard fanboys, most Americans realize that our auto industry has major problems, and the companies need to change their way of business, with Ford (so far) making the most headway in that area. This does not mean, however, that a Golf is necessarily more reliable than a Focus (the American one), even though nine out of ten Americans would agree that the Golf is a nicer all-around vehicle. It just isn’t more reliable, and when you are making payments yourself, and mass transit isn’t necessarily convenient or even available, better handling or a nicer interior isn’t much consolation when the car has to go back into the shop again for another three-figure repair.
And please note that the Chevrolet Matiz is not really an American car, despite its nameplate. It is really a South Korean vehicle.
Ingvar: I would say that besides third world driving like in Africa, no other people on this earth drives their cars harder, and no market is as quality and reliability oriented as the European.
I’ve been there, and I can’t buy that. As we’ve noted, a large number of Europeans don’t buy their own cars. So they can afford to worry about fit-and-finish finish (which is not the same thing as reliability) or handling prowess as opposed to whether it will need an expensive repair four years down the road.
Most European countries have speed limits that aren’t THAT much higher than those in the U.S. (In places like Great Britain, enforcement of the speed limit is more draconian than it is here in the U.S.)
And even on the sections of Germany’s Autobahn where there are no posted speed limits, most of the VWs, Opels, Fiats, and Renaults aren’t driving flat out. They usually travel at about 75-85 mph, which is about the speeds at which people drive in the U.S. on limited access highways.
Again, Pch101 is entirely right when he says that Europeans need to accept – as most Americans have – that they aren’t the only ones who can build a great car. The Japanese (and, increasingly, the South Koreans) are building very good vehicles, and any company or country that ignores the challenge that they pose does so at its own peril. Detroit is Exhibit A in that regard…
Because in the US, VW is always at the very bottom in reliability rankings, while in Europe they’re on the very top.
Even your own data doesn’t show this. And we’ve discussed at length here why the disparities would naturally be lower: the European survey is includes factors other than reliability, and is done when the cars are newer and with lower mileage. Very simple stuff to understand, if you accept this for what it is.
It’s true for the US, but not for Europe.
Again, the US cars have been driven a lot more when surveyed. I’ve pointed this out several times already, as has Geeber. Mileage has an impact on reliability results.
As a former dealer of both European and Japanese cars, I’ve always felt the difference boiled down to assembly quality versus material and component quality.
Americans tend to trade their vehicles with much greater frequency than Europeans and are therefore most impressed by having zero problems in the first few years. Since the stuff that goes wrong early in a vehicle’s life is often attributable to assembly quality–where the Japanese have long held the lead–the Japanese manufacturers have enjoyed great success in the US.
Over the long term, reliability is more greatly affected by material and component quality–an area where the Europeans have traditionally excelled. Europeans may drive less, but it’s often under worse or more demanding conditions and they keep their cars forever. Hence their success at home and in many third world markets that have harsh driving environments. Problems related to poor assembly can almost always be fixed, whereas it’s the stuff it’s made of that most often determines a car’s ultimate fate.
I used to think that this too was changing–that the Japanese had narrowed the gap considerably wrt materials and components–but then recently Toyota repurchased the Tacoma 4X4 I bought new in 2000. It looked as new on the top side–no accidents and original paint–but with only 90k on it the frame had rotted through. Never good to generalize from anecdote of course, but this Toyota frame problem was widespread and not the only example of its kind.
My general advice remains for frequent traders to stick to the top Japanese brands and those with longer purchase cycles to consider the better European marks.
*Note that by “European”, I typically mean the German and Swedish companies that are long time players in the North American market. I can’t explain the British, French and Italian car co’s successes in their respective markets as anything other than habit or going for the home team :-)
And a PS: I know the ratio of company-supplied versus individually purchased vehicles in the UK is high, but I haven’t personally observed that to be the case in Germany or Scandinavia. Are their stats really similar to the UK’s?
ZekeToronto: Over the long term, reliability is more greatly affected by material and component quality–an area where the Europeans have traditionally excelled.
If the car is breaking down more often early in its life, what incentive is there to keep it for the long term?
ZekeToronto: Problems related to poor assembly can almost always be fixed, whereas it’s the stuff it’s made of that most often determines a car’s ultimate fate.
The problems with European cars tend not to be related to poor assembly, from what I’ve seen. They stem from basic engineering issues.
The case of VW reliability has always puzzled me greatly. In Europe VW is considered a very reliable brand yet in NA it has the opposite reputation and just based on the colorful anecdotes I have heard not undeserved.
When I ask friends and family in Europe if they have problems with their VWs the answer is always not really. Yet here in NA whenever the reliability of VW comes up there is always plenty of people to share their miserable experiences about the Vdubs they often love.
I still haven’t seen a good answer to explain this Pch101 posts notwithstanding.
I think the driving in NA is much less varied in terms of mileage, road conditions etc than in Europe. In Europe you either have people who bought their cars and usually they drive little, longer distances only on the weekends or holidays. To work they can usually take a mass transit. So the reliability for them is not that important and because of the minimal driving it there isn’t much opportunity for anything to go wrong. This case could be explained by Pch101’s point.
But the other large group of people in Europe are those that get a company car. Why? Because they have to drive a lot as part of their job. I would estimate that a regular employee with a company car drives a minimum of 30K miles (50K kms) a year. And there are plenty who drive more. And they do drive hard. Why? Because they don’t own the car and generally don’t care much about it. One would expect that this group of people would be the one to experience the reliability issues of their company VWs. Yet from my experience they don’t complain about the reliability of their cars. I would think that if the cars were expensive to maintain the companies would just stop buying or leasing them and switch to cheaper (Japanese?) alternatives. But that is not happening as Japanese have made very little progress in Europe over the last decade.
I would like to hear an explanation for this case.
I have to throw in my two cents worth on the VW reliability comments. I was a mechanic at a VW dealership when the switch was being made from European-built Rabbits to Westmoreland PA cars.
The European build quality was great, the interiors and paint far superior to the American Rabbits. The handling and suspension much tighter.The Westmoreland bunnies had rattles, shiny plastic dash panels, mouse fur headliners, soft springs and numb steering.(GTI excepted) The only place where the US Rabbit was obviously superior was electrical, as the Euro model had many problems. Changing the entire fuse block was a daily occurence on both gas and diesel models. Of course the Euro gas model had a big issue with valve stem seals and guides, but I left in 1985, so I can’t say whether the US motors were any improvement.
geeber wrote:
If the car is breaking down more often early in its life, what incentive is there to keep it for the long term?
Firstly, keep in mind we’re not talking about orders of magnitude difference in problem frequency–it’s very easy to exaggerate with statistics. It’s entirely possible that Europeans who buy their own cars expect a certain amount of maintenance, whereas North Americans (unrealistically, in my view) don’t seem to think these complex mechanical and electrical devices should ever require any. The reason: if you buy a car with the expectation of keeping it for the long term, you’re less likely to begrudge the cost of maintenance and repairs in the early years, knowing it’ll be you–not the guy who buys your trade-in–who benefits.
The problems with European cars tend not to be related to poor assembly, from what I’ve seen. They stem from basic engineering issues.
I’ve been out of the business for a few years now, but I have no idea what you’re talking about here. Are you perhaps including the British, French and Italian cars that I was excluding from my comments? In my life I’ve seen very few egregious examples of poor engineering in German and Swedish cars.
@Geeber:
Right now, I’m a little bit drunk. This is the night after the boys’s night out. Anyway, I’m not stupid. I understand your point. And perhaps I’m out there sometimes just to provoce a disucssion. Not every single word I say have to be taken like hard facts, ok? Well, cheerio, and hope ya’all have had as a good time as I have. And see ya next Wednesday…