I didn't realize Toyota is THAT successful

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From a news report today: Toyota reportedly has enough cash on hand to buy GM's entire automotive operations outright and is gunning to replace GM as the No. 1 automaker within five years. WOW! I had no idea Toyota is performing THAT well and GM is performing THAT poorly! OMG! That's a LOT of cash to have on hand. I knew the Toyota was aiming for the #1 spot, but GM is bleeding cash like a sieve. Woe to GM. Is Ford next? I hope not. So much for having ANY domestic car makers any more...
 
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This might be a tad off topic, but I was amazed to see in the 205 Consumer Report car issue, how successful the Hyndai (South Korean OEM) has been in JD Powers type of metrics. In some ways it has taken nameplates like Toyota Nissan Honda etc 35 or so years to really reach and stay as "king of the mountain" So the current snap shot has Lexus Toyota Hyndai and Honda taking customer generated top honors. But even in that case Toyota had to spin off Lexus. Curious thing is GM is pretty high up there and in fact is better than the European name plates. Evidently it has not made as much hay as the South Korean OEM's.
 
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This is labor recycling. Culling the old and the flourishing of the new. What's it matter? If GM could flush all it's dead long term weight and still keep the GM logo ..you really would see much of a difference. But when a domestic automaker of foreign origin is young and vital ..over takes a domestic automaker that is old and ailing, it looks different. Just look at Toyota as an AMC that actually made something worth owning and you won't be so shocked.
 
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There are many things have caused GM to be in this situation, but I think it can all be traced back to one thing - short term stock price thinking. American companies are very short term ortiented because of the share holders and the executive compensation packages. As a result, when a decision has to be made, the choice with the best immediate impact is typically chosen. Meanwhile, the japanese companies, especially Toyota, have been working with long term strategies. Toyota knows that if they sell a compact car to a young person as their first new car, and they have a good experience with it, they will come back years later and by a mid-size vehicle, and maybe someday a large vehicle such as Lexus. GM, Ford, and Chrysler can't make a profit on small cars, so they quickly abandon their smaller vehicles. Very different strategies. Example: Many people blame the UAW for GM's woes. While the union labor contracts are over the top IMHO, GM agreed to these concessions when times were good to avoid strikes which would hurt short term profits and stock prices. Example: While gas prices were low, and the margins were good on large SUVs, GM went full bore on the SUV market. During this time, they let Saturn struggle with very little new product, killed of Oldsmobile, but launched the hummer H2.
 
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quote:
Originally posted by DockHoliday: I think it can all be traced back to one thing - short term stock price thinking.
That's one of the biggest, if not the biggest problems the US has. GM is only one company with the problem, but they are in the running for poster child.
 
quote:
Originally posted by Gary Allan: Just look at Toyota as an AMC that actually made something worth owning and you won't be so shocked.
Very well said Gary! I do have to admit that this "paradigm shift" took me a couple of minutes to "digest" as the visual was killing me...seeing my beloved Tundra morphing into an ugly a** AMC Matador... Steve
 
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Flash news. Toyota has cancelled plans to buy GM and instead is going to buy Florsheim. They changed their plans after careful analysis of both companies. They determined that by buying Florshiem instead of GM they would get the same number of loafers for less money. [ June 20, 2005, 03:22 PM: Message edited by: Gary Allan ]
 
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quote:
seeing my beloved Tundra morphing into an ugly a** AMC Matador...
It's easier to see a Hornet Hatchback morphing into a 240Z and wondering where the company would be if they didn't subscribe to some, yet to be defined, lame mission statement to build cars with lousy styling and boring performance.
 
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I've seen a few of these floating around, nothing but flamebait IMO. Toyota is riding the publicity of the hybrids right now, and GM has bad press from the Hummer and other models. The fact is both make hybrids and both make SUVs. -T
 
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quote:
Originally posted by Gary Allan: If GM could flush all it's dead long term weight and still keep the GM logo ..you really would see much of a difference.
I couldn't disagree with this statement more. Large institutional investors like mutual funds and pension funds now own more than half the stock in American companies today-- maybe as much as 70 percent. In 1980 it was 40 percent. In 1970 it was 19 percent. Go back much further than that and these institutions were inconsequential. Today, Wall Street now has way more power than Unions to influence large corporations. And with all the shenanigans they've been guilty of the past decade that's where I'd start looking for GM's current woes. The stink is usually close to the poo. [Big Grin]
 
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Hey, pal ...they're in on it too. It's not their money. They just broker it ...right down the drain. [Big Grin] Don't misinterpret my statement as meaning that any of GM's woes are a result of labor costs. There are lots of costs in manufacturing ..the human direct labor is probably one of the smaller parts. It didn't take a genius to predict that GM or Boeing ..or GE or IBM would be paying in spades for this type of thing at this level of maturity. And it's not rocket science why someone like Toyota can "start out fresh" and come out smelling like a rose. Aside from the oil companies ..and maybe a couple of chemical giants ...what heavy industry/manufacturing is left in the USA? Not a whole lot...and many have been reorganized to dump their dead weight ..or just moved off shore. [I dont know] That's why they're going out of business. It's time to get out before they have to pay out.
 
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quote:
Originally posted by Gary Allan:
quote:
seeing my beloved Tundra morphing into an ugly a** AMC Matador...
It's easier to see a Hornet Hatchback morphing into a 240Z and wondering where the company would be if they didn't subscribe to some, yet to be defined, lame mission statement to build cars with lousy styling and boring performance.

That would be like Rosie O'Donnell morphing into Angelina Jolie. An impossibility. Now, Rosie O'Donnell morphing into an AMC Matador I could believe.
 

ToyotaNSaturn

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quote:
Originally posted by XS650: That would be like Rosie O'Donnell morphing into Angelina Jolie. An impossibility. Now, Rosie O'Donnell morphing into an AMC Matador I could believe.
[LOL!] [LOL!] [LOL!]
 
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quote:
Originally posted by Gary Allan: And it's not rocket science why someone like Toyota can "start out fresh" and come out smelling like a rose.
I guess I don't understand what you mean by "Toyota starting out fresh". Also, explain how that fits in with the fact that when GM was cash rich it went on a buying spree. 15 years ago an engineering buddy of mine at GM use to like to brag that GM had enough cash on hand to buy out Toyota lock, stock and barrel. [Big Grin]
quote:
Originally posted by Gary Allan: This is labor recycling. Culling the old and the flourishing of the new.
Is that the same thing as retiring replicants?
 
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Toyota didn't throw their plants in downtown Detroit. The didn't hire 55 year old auto workers. They got tremendous tax breaks to be located in the states that they were built in. They don't have any 25 year old vetrans ...since they haven't been (manufacturing) here for 25 years. I can't comment on GM's internal managment of it's funds...but even without it..and just from any assumed model, Toyota would have a destinct advantage over any auto manufacturer of domestic origin. I'm sure that there are elements that extend beyond those items. Do they domestically engineer their autos..do their own R&D? I don't necessarily believe everything that I read. We're obviously being "prepped" to allow this evolution to pass, with all the "unfair" aspects of it...
quote:
Is that the same thing as retiring replicants?
Sorta. Today we call it corporate reorganization.
 
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quote:
Originally posted by Gary Allan: Toyota didn't throw their plants in downtown Detroit. The didn't hire 55 year old auto workers. They got tremendous tax breaks to be located in the states that they were built in. They don't have any 25 year old vetrans ...since they haven't been (manufacturing) here for 25 years. I can't comment on GM's internal managment of it's funds...but even without it..and just from any assumed model, Toyota would have a destinct advantage over any auto manufacturer of domestic origin. I'm sure that there are elements that extend beyond those items. Do they domestically engineer their autos..do their own R&D? I don't necessarily believe everything that I read. We're obviously being "prepped" to allow this evolution to pass, with all the "unfair" aspects of it...
I'm feeling lazy so I'll respond in list form: Not all GM plants are in Detroit. I'm even willing to place a small wager that MOST aren't in Detroit. You know someone in HR at the U.S. Toyota plants to able to reliably inform us of the demographical information of their workforce? Do you have a list of all the tax breaks that Toyota received for all their U.S. plants? How many U.S. based corporations receive these same tax incentives in comparison? I'm not sure what you have against 55 year-old factory workers, but having worked side-by-side with 20-somethings and 50-somethings while providing engineering support in a production environment, I can tell you I preferred the 50-somethings. They generally had a better work ethic, troubleshooting skills, attitude, and attendance. I still contend that GM's current situation is due to bad decisions made by corporate management who were heavily influenced by big institutional investors. And GM is not the only one with this affliction. [Cheers!]
 
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