Why did GM fail?

[The Backlash Cometh]

GM is about to shed a quarter of its workforce and it could be a sign that it's the beginning of the end for America in the motor industry. http://msnbc.msn.com/id/13541353/

And I keep asking myself why is this industry going under, when any intelligent person would have known that smaller cars would have meant less materials to use and there was definitely a market for them? Can anyone explain why GM failed? Why did it refuse to change its course back when it had a chance? Was it hampered by being in a fly-over state? Wrong mindset? And is this inability to change course an example of what will happen to the rest of the country?

[davidwparker]

1. stupid white men. You know, the ones with the executive hair.

[The Backlash Cometh]

5. GM definitely proved that bigger is not always better.

However, please note that free market has spoken. Do these stupid white men think they have some special immunity against failure?

[davidwparker]

67. waving the flag and we'll come back. what truly is galling is that Thom

Hartman talks about being in Germany where GM already had cars that got 60miles/gal. And, I believe it was Mother Jones radio yesterday where they had guests talking about their new movie where the car makers had electric cars. Calif. wanted them to consider it and they did. While the car manufacturers were following the letter of the law, as one said, they were having law makers change the law. One day, the car manufactures took all the electric cars and demolished them. Pity.

My thought: Buy Toyota. They hire Americans.

[wakeme2008]

2. Go see the movie Who killed the Electric Car

GM's super big mistake...

[The Backlash Cometh]

6. Name names.

What CEO was responsible, and is he still collecting a pension?

[wakeme2008]

38. If you have not seen the trailer do so

here http://www.apple.com/trailers/sony/whokilledtheelectriccar/

Notice that Sony is putting out the movie... MMMM Sony... Japan.... Mmmmm

[HysteryDiagnosis]

15. Did you see the special with Tom Friedman?? Aren't there

some people taking the batteries out of the hybrids (Toyota) and installing bigger battery packs.... then getting the black button on the dash functional that puts the car into an electric only mode???? I thought I caught that the other night.

[The Backlash Cometh]

20. This is a momentus time. We will be saved by our garage inventors.

And now with the internet, no corporation will be able to steal the secret from the public.

[HysteryDiagnosis]

24. You sound as if you may have seen this in your travels....

Hydrogen storage for DUMMIES:

http://newsroom.ucla.edu/page.asp?RelNum=6873



UCLA, University of Michigan Chemists Report Progress in Quest to Use Hydrogen as Fuel for Cars and Electronic Devices

Chemists at UCLA and the University of Michigan report an advance toward the goal of cars that run on hydrogen rather than gasoline. While the U.S. Department of Energy estimates that practical hydrogen fuel will require concentrations of at least 6.5 percent, the chemists have achieved concentrations of 7.5 percent — nearly three times as much as has been reported previously — but at a very low temperature (77 degrees Kelvin).

The research, scheduled to be published in late March in the Journal of the American Chemical Society, could lead to a hydrogen fuel that powers not only cars, but laptop computers, cellular phones, digital cameras and other electronic devices as well.

"We have a class of materials in which we can change the components nearly at will," said Omar Yaghi, UCLA professor of chemistry, who conducted the research with colleagues at the University of Michigan. "There is no other class of materials where one can do that. The exciting discovery we are reporting is that, using a new material, we have identified a clear path for how to get above seven percent of the material's weight in hydrogen."

The materials, which Yaghi invented in the early 1990s, are called metal-organic frameworks (MOFs), pronounced "moffs," which are like scaffolds made of linked rods — a structure that maximizes the surface area. MOFs, which have been described as crystal sponges, have pores, openings on the nanoscale in which Yaghi and his colleagues can store gases that are usually difficult to store and transport. MOFs can be made highly porous to increase their storage capacity; one gram of a MOF has the surface area of a football field! Yaghi's laboratory has made more than 500 MOFs, with a variety of properties and structures.

[The Backlash Cometh]

28. Very promising.

[burythehatchet]

3. here's why

[Redstone]

4. One example: They're bringing out a "new Camaro" FOUR YEARS after

Ford brought out the new Mustang...which Ford can't make fast enough to keep up with the demand.

Need any other examples?

Redstone

[The Backlash Cometh]

9. I bet their CEOs were rewarded well, just the same.

[Redstone]

12. Of course! Wouldn't take long to find out HOW well, either.

Redstone

[The Backlash Cometh]

14. You want to take down CEOs?

Use GM as an example.

[Redstone]

17. They're the worst by far, indeed.

Redstone

[billbuckhead]

16. GM spent millions NOT to buy FIAT

It's not just the Japanese who kicked GM's butt. The Germans have virtually taken the luxury car market from Cadillac and Buick. Chrysler kicked their butt in minivans which they could never get right. Now GM is closing it's minivan factory in Doraville, Ga. An endless stream of bad management decisions.

[The Backlash Cometh]

21. The story here, is if the CEOs were given bonuses while all this

was happening, the question is, why?

[Poppyseedman]

7. GM failed for one reason and one reason only

Their product sucks.

It has nothing to do with big vs smaller cars, gas vs electric, union vs non union. What state they were produced in.

Bottom line is real simple. Toyota and Honda make a far superior product. GM could have, but refused to

[elehhhhna]

10. Their service sucks, too.

[The Backlash Cometh]

13. I'm sure that had a lot to do with cutting back on overhead.

[The Backlash Cometh]

11. So we can make rockets that go to the moon, but we can't make

a car that goes better?

[ulysses]

18. not "can't". won't.

[The Backlash Cometh]

23. We need to find out why.

[ulysses]

32. greed. laziness. lack of innovation. apathy. stupidity.

Take your pick.

I drive a '95 Sonoma which I enjoy, but which is wearing out at about 120k miles. I want another light truck, and I want a hybrid. When I looked last year, the only American-made truck you could get hybrid was a Silverado...which is kind of like putting lipstick on a pig.

[The Backlash Cometh]

34. Maybe it's also the short-term mentality that gets to CEOs who are there

just for their annual bonuses?

[ulysses]

36. see, I'd crossfile that under "stupidity" and "apathy"

Then again, I'm the kind of person that would expect himself to actually *do something* to help a company that paid me the kind of money that CEOs are given. Silly me.

[serryjw]

51. Personally speaking they always missed me

EVERY new car I have bought has been a putt-putt since the first 1970 TOY(automatic). I always thought of a car as transportation and wanted a well built CHEAP car without all the bells and whistles.

[JCMach1]

55. More endemic than that... the BEST GM cars are JUST as good

as the Japanese models (in some cases better).

the Difference?

GM sought to maximize profits while the Japanese looked to secure world markets by providing consistently reliable vehicles.

The profit/corporate mindset is killing American industry.

It's not all blue skies for Germany either... Some brands there are struggling for similar reasons. For example, VW and BMW both struggle with reliability and quality these days. I wouldn't own either of those companies.

Meanwhile, companies that have focused on the Japanese model: reliability, design, and agressive world-wide push for marketshare are creating great cars.

I own a Peugeot and it is fantasic. The design is brilliant and everything else is perfect. 10-15 years ago Peugeot was almost a corpse of a car company.

GM can recover, but it will take time. I would own a Buick today if I could get one here... (there is no Buick dealership in UAE)!

[mdmc]

8. Hummer

Burn GM, BURN:mad:

[madmom]

19. in a recent wall street journal story they wrote... "GM often cites

'legacy costs' including pensions for it's US work force. In it's latest annual report GM wrote "our extensive pension and post employment obligations are a competitive disadvantage for us." But what they aren't saying is "the pension plan for the rank and file US workers contain $9 billion more than is needed to meet obligations for years to come. The pensions programs that do hurt the company with it's liability of $1.4 billion is the pension plans for the executives.


This was an article just today in The Toledo Blade Business section. I could not get the link to work, maybe you can if you want to read the whole story.

www.toledoblade.com

[The Backlash Cometh]

27. Good info.

[deaniac21]

42. Yep.

[trogdor]

65. If they made decent cars that people wanted...

...they wouldn't have to worry about legacy costs.

[AngryAmish]

22. GM did not fail, other companies succeeded

Foreign companies put more engineering into their products. Or more good engineering and design.

[The Backlash Cometh]

29. Did those foreign companies invest in new products on their own?

Or did their governments help them with finance, research and development? In other words, were the other companies 100% capitalist?

[AngryAmish]

31. As much as our companies are.

[Rosemary2205]

25. They have nothing we want

not a single vehicle they sell excites my husband and he is in the market for something new to replace a 1970 somethign Chevy pickup that finally on it's last leg. He no longer needs a pickup and wants to replace it with a "travel car" as we are getting to that kidless point in life where we tend to run away on weekends. He's disgusted that not one single GM product makes him want to spend his money. Only 2 cars made him want to sit in it and one of them had too many blind spots and the other had terrible gas mileage.

BTW, he says the Ford 500 feels the best so far, but it's butt ugly. -- he may end up with the new Chrysler, which is not an American car.

Thus is the bane of American car makers.

[The Backlash Cometh]

30. There are plenty of young minds out there producing better model

cars. They're just not listening.

[TheCowsCameHome]

26. They refused to change with the times. Stuck in the old days mode.

They let Honda and Toyota dominate the market while they built Hummers, Denalis, and other monster land barges while the public was eating up the imports that were reliable and economical.

[The Backlash Cometh]

33. GM and Hummers.

Makes you wonder how many other corporations were counting on this war to help them out of a jam.

[TheCowsCameHome]

37. Hummers for war and Denalis to ferry Bush and his entourage around

won't sustain GM for the long haul.

Meanwhile, the general public buys where they get the best bang for their buck.

[conflictgirl]

35. You're absolutely right

My dad works for GM and I live in a GM town that has seen several plants close over the past couple decades. GM's problem is that they are slow to adapt to customer trends. The same could be said about American automakers in general. I considered buying a Honda despite my dad working for GM, because I had heard such great things about the Hondas, but I test-drove more than one and multiple years apart and I really hate the way they handle. I think GM might have been on to something with Saturn but didn't develop it well enough.

GM still makes NO hybrids (as far as I know) and keeps focusing on big trucks and SUVs, despite the fact that customer demand has decreased. Most of the GM cars that are fuel-efficient are tiny little crackerboxes with designs that people find unappealing.

I honestly think that if GM were more innovative and quicker to react to changing customer trends (which honestly are not even changing all that rapidly) they could still be afloat. But the company runs its marketing like it's still 1970.

[TheCowsCameHome]

40. They seem to think they can dictate what we'll buy.

If they want to cater to a small niche, then they should be prepared to suffer the consequences.

I've got 4 older GM vehicles - a '64 antique, an '85, an '88 and a 1996. I'll drive them into the ground, but I see nothing that interests me in their current stable.

Next time will be either Honda or Toyota, as I see it now.

Too bad - I was always a GM guy, but I'll be damned if I'd ever buy one of their silly monster vehicles. Or the little roller skates like the GEO.

[Strelnikov_]

39. The American Auto Industry Will Be Back

When the smash comes and the majority can no longer afford imported goods.

A 10% GDP current accounts deficit cannot go on forever, can it?

[The Backlash Cometh]

43. Hmmm...

Interesting take.

[flvegan]

41. They lost the trust of the American consumer.

Ask a person why they bought the car/truck that they did. Gone are the days where "you just bought a Ford" if you wanted a truck. Gone are the days where you went to the dealer for all your repairs, or did them yourself.

Find someone on a Honda lot, looking at Civics and ask them why. They'll tell you that they want reliability and resale value as well as good mpg. The Civic is a better deal than the GM rival.

Hell, when Toyota, Nissan and Honda put Lexus, Infiniti and Acura forth, who do you think they were gunning for? Cadillac and Lincoln, mostly, though now, they're making Mercedes and BMW antsy.

To be honest, the only thing GM has done right for a long, long time, consistently, is the Corvette. They should study why that is.

[jody]

44. After GM goes bankrupt and sheds its retirement debts, it may become a

very viable, profitable company again.

Of course the Pension Benefit Guaranty Corporation (PBGC) will pick up some of the retirement cost and the retirees will lose the rest.

The good news is that GM will emerge free from its obligations to its retirees. That's how corporations use bankruptcy to avoid debt but Bush and the Republican congress passed the "Bankruptcy Abuse Prevention and Consumer Protection Act" in 2005 that makes it more difficult for ordinary citizens like retirees to avoid their personal debts caused by GM's bankruptcy. :puke:

[AndyTiedye]

45. How Can GM Be Profitable If they Build Cars & Trucks Nobody Wants?

America's automakers are really truckmakers.
They don't do cars very well, so they went all-out to sell us all trucks.
Unfortunately, GM doesn't even build very good trucks.

Ford at least can build trucks, and actually builds one very nice hybrid SUV:

which is the only hybrid you can buy today that is built in the USA by union labor afaik.
(It gets better mileage than the Toyota hybrid SUVs btw).

GM did build one really cool car in the past decade or so: the EV1.

For reasons known only to GM, they terminated the program, and went to great trouble
expense, and HORRIBLE publicity to get the vehicles back from their devoted lessors
and destroy them. That act alone must have cost them tens of thousands of customers.

[jody]

50. My WAG was that GM wants to be unprofitable so it can dump its retirement

debt on the federal government via bankruptcy. After that it could be very competitive in the vehicle market. :shrug:

[buzzard]

53. I doubt the government will be able to pay at the current rate of debt.n/t

[jody]

54. Still, the bankruptcy process allows GMC to dump the debt on PBGC. n/t

[raccoon]

61. Ding, ding, ding! We have a winner! nt

[xxqqqzme]

63. one reason the EV went away is because there is no

after market maintenance. I know one family here in town that leased 2 EVs. They tried everything 2 be able 2 keep them. I rode in one theirs. The husband explained that the EVs are virtually maintenance free. No oil changes, so no filters; the brakes don't need replacing because when you lift your foot the car stops - less wear and tear on tires as well. Think about all the jiffy lubes & tires for less kind of places, small business owner/mechanics. It turns the local economy on its head.

[leesa]

46. Business deal with the oil companies? Let's face it, Americans were

suckered into buying gigantic SUVs and trucks they never had a need for before, through seductive advertising and less-than-honest safety data. Most owners are going to hold on to these gas guzzlers for 10-15 years or more. That's a lot of excess gas consumed for no particular reason. Kaaaching.

[The Backlash Cometh]

48. I sort of disagree. If Gore had made it to the presidency in 2000

as it was suppose to be, we wouldn't be having this oil crisis and our SUVs wouldn't be such a pariah. Cheney and his gang brought it on prematurely.

[tnlefty]

47. GM failed because...

they consistently build HUGE cars,trucks, and SUV's all the time. they never seem to get that smaller cars burn less fuel. If the cars burn less fuel,they cost less to operate, and people (especially now) will WANT them. The CEO and exec bonuses put a enormous strain on finances, meaning that all of their small "concepts" never see daylight. Poor initial quality means that GM is a far worse buy than any other foreign car company, save for Mercedes and Audi. That is why GM failed.
This is one of TNlefty's sons by the way.

[Odin2005]

49. For the same reason Kenny Boy cooked the books.

Investors nowdays are more concered about speculation (bying low and selling high) then actually caring about the long-term prospects of companies they invest in. These speculators only care about the short term, and so companies will ignore long-term things that involve short-term pain so they don't scare off investors.

[The Backlash Cometh]

52. Because they can.

If they get away with this much WITH regulation, you KNOW it can only get worse with deregulation.

[Doc_Technical]

56. Its history repeating itself, again.

Check out the book "Whatever happened to the British motorcycle industry".

http://www.amazon.com/gp/product/1859604277/qid=1151312281/sr=1-1/ref=sr_1_1/103-5953028-6101404?s=books&v=glance&n=283155


American cars used to be among the best in the world, but they rested on their laurels and
the rest of the world passed them by.

The executives stopped being manufacturers and became accountants.

[The Backlash Cometh]

57. I have noticed this about CEOs

They have been developing a collective way of thinking. Just like Republicans in Congress. No innovations. Just stay the course and collect your short-term bonuses.

[screembloodymurder]

58. Look at their cars and you'll know.

GM is using a Mennonite design team.

[The Backlash Cometh]

62. Explain, please. What's a mennonite design?

[Rosemary2205]

64. Plain and boring?

Nothing exciting.

[Hugin]

59. The whole thing is a Ploy to shed their pension fund...

I also get the impression they don't really want to make cars anymore.

[FooFootheSnoo]

60. I think the upper management at GM

must be smoking crack instead of working. GM should have and could have developed at least one super efficient, reliable, small car. If I were in charge, that's what I would have done starting in the 70's. I can't believe they are still concentrating on SUV's. That's crazy. They outsource all their customer service, I used to work for that company. Believe me, GM does not really give a shit about their customers unless they've bought several brand spanking new GM vehicles. I have never worked in such a chaotic environment in all my life. If they manage everything the same way they manage customer service, it's no surprise they are on the way out.

[Throd]

66. The Cadillac Cimarronm is a perfect example

Back in the 60's GM was producing a very quality product. As the 70's wore on they tried to save money by cutting corners rather than being innovative. By the 80's it was all over. They put a hideous giant grille on a Chevrolet and called it the Cadillac Cimarron thinking that people wouldn't notice. People did notice.

I currently own Oldsmobiles from 1959, 1967, 1968 and 1973, all of which are fine cars.

I used to own a 1980 and a 1984 which were pathetic pieces of crap.

Last year I bought my wife a new Honda.

[Zynx]

68. Bad product, bad business model, bad management.

[B Calm]

69. When union jobs are lost, we all lose. Bush and his cheap labor

conservative backers win!

[MilesColtrane]

70. GM failed because many who bought it's products vowed, "Never again."

Like me. My last GM was a 1985 Chevy Blazer.
What a piece of crap.
Went through two transmissions, and a short block replacement. (oil pressure light failed to come on when the oil pump failed)
First transmission failure came three weeks after the warranty expiration.

GM had it's chance. My first car was a '72 Chevy Nova. I liked it. I was ready to be a customer for life, but they burned me.

Never again.

[WI_DEM]

71. don't you think that a major company shedding 25% of its work force

would be bigger news? and yet the "media" continues to say the economy is great.