Why can't US car maker build a quality product?
 

2 words....Labor Union

http://news.bbc.co.uk/2/hi/business/4815646.stm - GM markes a 10.2B dollar loss for 2005

http://news.bbc.co.uk/2/hi/business/4639034.stm - Ford closes 14 plants, cuts 30,000 jobs


Take all this in to account: higher labor rates + labor unions + higher manufacturing costs + higher EPA/Government regulations = hard times for business.

My point being all these peeps that run around asking, "why can't the US build a quality car?" Well, with all the above "costs" a quality US car would start in the high 50K's, so to compete you have to cut somewhere and since you can't bypass the Government...you cut the product. Why? Because you can always recall and fix the product. IMO this is why US cars have such reliability issues along with build quality problems.

I agree that the US car makers are drowning in red ink, but the truth is that US car makers are doing a lot better at making reliable cars. We have to keep in mind that the US car makers pump out hundreds of thousands of cars a year while the European manufacturers produce far less. Ironically, the reliability of the Euro cars, and some japanese cars, are being passed by the US manufacturers. That is not to say that the non-US cars are getting worse, not at al, the US manufacturers are just doing better.

That being said, Roger Penske needs to be hired as the next CEO of GM. He turned Detroit Diesel around in under 5 years, from a 3% market share when GM owned them to a 30% share, and he did it by competing with Cummins!

I've posted this many times, maybe it should be a sticky :)

http://www.jdpower.com/presspass/pr/images/2005089a.gif

The other 2 words. Crappy products. Unions don't stop people from buying a quality product.

They do when $1500-$2000of every car goes to paying the union members health care and pension for the rest of their lives.

That may be true for some folks. However I just bought a 2006 530i. The money I paid for it i could have bought 2 American cars. Why didn't i? Was it because $1500-$2000 of every car goes to paying the union members health care and pension for the rest of their lives? NO. I didn't find anything that i thought measured up to my dollar. Why not just build a better product that people are willing to buy then you can pay your bills and stop whining about what it's costing you to do business. I agree that American Auto Makers Need to pull together their business model but it's all a lot of talk until you make a product that someone wants to buy.

Quicksilver, you also have to remember the major consumer base isn't buying vehicles over $40K. They are buying vehicles between $15-$33K. I believe dollar for dollar there are a few GM (Cadillac) vehicles that could compete easily with a 5-series. Individual preference may lead in a different direction, but there is competition.

When you have a company like a GM or Ford, these are companies that own multitudes of other companies or at least have major stake in others. What drives me nuts is when people in general go "US car makers can't build a good product" that just isn't true, what is true is they can't build a seriously competing vehicle for the cost. IMO all automakers should cross their fingers and pray to the car-Gods that China doesn't decide it wants a serious auto industry. The amount of "free" labor there would kill Japan/Euro/US sales all together.

I'm not following you. You paid 2x what an American manufacturer would charge you for a car because why? What percentage of the US population do you think can afford to spend, what? almost $70k when all is said and done, on a car, when their average income is somewhere in the $50k's?

People pay 2x as much because, well there's no nice way to put it, because they like the status symbol of it. Reliability being equal, there is no reason to spend more than $20k on a car these days, unless people want the 'extras'. Don't get me wrong, I like buying higher end cars myself, i'm not throwing stones in a glass house, but to deny the facts that most people buy BMW, DC/MB, Audi, Ferrari etc etc, isn't because they need basic transportation, it's for a lot of intangible reasons that none of us like to admit because it makes us look shallow and prideful.

Exactly.

YAHOOOO Got everyone's juices going. IT'S MONDAY. Yep all of you are correct. Theres a lot of truth in every one of your arguements. I for one was just stirring the pot. Your right I didn't buy a BMW because i needed basic transportation it was because I'm getting old and do not intend on going out without having some fun. Now maybe that may be an intangible reason but all i have to say about that is "keep on living". I believe your own mortality will change that attitude.:rofl:

I have already seen the light at the end of the tunnel and it's a triain coming my way :) hence the '01 and '04 bmw's, the new house last year, the '04 vette, the breitling i'm looking to get... you can't take it with you, and you never know when your number is up, might as well enjoy it while you can.

Welcome to the mid-life-crisis club! I'm with you guys 100%! :rofl:

OK you youngsters, Don't forget those retirement accounts. Don't spend ALL you money on things.;)

youngsters? i'm 40! :)

401k and pension is fully funded....

40? Yep your a youngster. But glad your funded. Spread the word

http://money.cnn.com/2006/03/20/news...ex.htm?cnn=yes

Just more evidence :)

Funny side note:
This was taken from autos.MSN.Com, take a look and laugh...

TCO - Fuel
U.S. Government EPA mileage figures. Mileage is 60% highway driving, 40% city. Fuel cost per gallon is $1.32 for unleaded regular, $1.42 for unleaded mid-grade, $1.51 for premium, and $1.30 for diesel (subject to inflation). (Based on Energy Information Administration U.S. average self-service regular, mid-grade and premium gasoline and diesel prices.)

I'm racking this up as a management issue...just like the rest of the companies in the US these days. Just about every Japanese manufacturer have plants (and design centers) in the US and they have the same labor pool (high wages and all) to pick from as GM and Ford. So why don't the Japanese makers suffer from the same ill that GM and Ford does? Management!

You can not compare Japan corporations and labor with the UAW and US corporations. IMO. However, management is probably one of the vast issues. That or US corporations are use to the Government bailing them out when times get to tough...a la the Mini-Van in the 80's...GO CHRYSLER!

Ford and GM should merge together and cut at least 50% of their crappy prodcut lines.

Actually there is a busines model that can be used as an example. And it is Union, in the US, and it is profitable. Click on the link that say's "Numi Case study (page 1) It's a pdf file.

http://search.earthlink.net/search?q...roadband&FD=0&

That's a good model, for saving on waste in a company..material waste. However that does not address pention plans and the vast array Government regulation that falls on US manufacturing.

As long as I have been around it has always amused me that there has to be so many models and they change so quickly. Nowdays it's hard to keep track of what's what. I've rented a few and found some nice features built in. (creature features) But i found no real enjoyment in the driving experience. What I find interesting is the money spent on R&D and the results from the expenditure. I remember I bought a car in 1976 that had four wheel independant suspension and four wheel disc brakes. The American auto industry had few if any cars with those features at that time. Their reasoning for not providing those features was "we don't think those added features to be a cost effective addition for the American driving public". As time went by so many non American cars came with those features that they had to revisit the decision. I guess what I'm saying is that there use to be a time when the level of Pride involved in the manufacture of quality Automobiles in this country was much higher. Instead of following the auto industry was at the forefront of automotive innovation driving people into the showrooms. Nowdays I visit the show rooms and the excitement isn't there. Perhaps one day that will turn around.

Apparently it has Because in a recent news report it highlighted how they in fact are not dealing with the same issues much of the industry is going thru.