Impala article in NY Times

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Generally favorable article. I posted a topic a while ago about the pushrod engines with variable valve timing but could not find it. A side article about the engine says GM saved $800 per engine by using pushrod vs OHC, largely due to fewer parts. I am amazed that the cost difference is that high, and certainly find it interesting.
 
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So, with these $800.00 per engine cost savings, why is GM laying off an additional 30,000 employees, shuttering more factories, screwing around with employee retirement and healthcare promises, and sweating the prospect of bankruptcy? Pennywise in cost control can be pound foolish in market share. "Big" is not better if technology lags. (The dynosaurs found that out.) [ December 04, 2005, 03:17 PM: Message edited by: Ray H ]
 
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""Big" is not better if technology lags." For a long time Toyota had the reputation of producing vehicles with less than state of the art technology, which allowed them to get more mature, better developed vehicles to market, which tend to be more reliable. Granted execution counts for a lot, considering how many 'quality acronyms' started with Toyota processes.
 
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I agree with Ray H, Cost Cutting is a short term solution to a serious problem(s). It wasn't cost cutting that lead Kettering to the electric starter. It wasn't cost cutting that put the Corvette (arguably one of the greatest high performance bargains in the United States today) on the map. And it wasn't cost cutting that lead to disc brakes, radial tires, independent suspensions, etc. It was capital investment. It was taking a chance that something truly excellent would sell if it were priced right. I am angry at the short sightedness of GM. I am frustrated that apart from some amazing values such as Cadillac and the Corvette, GM has turned out good vehicles - not great vehicles - for the past 15 years. In my opinion, if GM wants to get back into the car business, they need to copy not the Japanese or Korean manufacturing and distribution models. They need to look closely at the Chinese. Many years ago, when WalMart was a small, local chain, Sam Walton told his managers, "...go to your competition. Look at what they're doing right. AND THEN COPY THEM!" Does this management philosophy work? Look at where WalMart is today. Whatever your feelings about WalMart, the fact remains, they're solvent. The old manufacturing and distribution models that worked 50 years ago have run their course. Cling to them at your peril. Tomorrows products will be outsourced to whomever can make the best for the least. Labor is no different. The service sector is in the same boat. Innovation and differentiation may be all that spells the difference between profitability and bankruptcy. These aren't just my opinions. This is what they are teaching in Master's level Management programs across the United States, if not the world. GM's competition is not Ford. It's every auto company and auto startup worldwide. The same is true for virtually every company doing business in the U.S. And finally, somewhere in the world there is another Sam Walton ready to step in when one of the "solid" old-line companys starts to rest on its past glories. In my opinion, this is a time of great change. Of great risk. And of great reward. Glen
 
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why GM is going bankrupt is. why yo uneed to have chevy,pontiac,gmc,caddy,buick,saturn,saab,hummer. why do a corporation need this many sub divisions of its self. like gmc and chevy trucks are the same thing just differnt badges on them. also the avalanche and escallade. just different names on it. use too alot of GM vehicles was the same vehicles but different names on them.rememebr the blazer,jimmy,bravada? they did shut down olds but I see them doing away with more. I wouldnt be surpised if buick is next on the chopping block. I always thought GM was too big for their own good. now with all these shut downs. I can see that they are. american major motors companies cant use the saying japanese vehicles arent reliable no more. wonder how the major 3 will feel when they are the under dogs and honda and toyo calls the shots. by the way if you havent figures out yet. I dont like GM [Thumbs Down!] . still dog my wife for buying a malibu.
 
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The rumor mill has it that Porsche may be interested in SAAB. Please, take it! PLEASE!!! Since GM can't do it right. It missed a great opportunity with them. It's trying to sell a 9-3'd Caddy made in Sweden. Guess what, Europeans HATE caddies for the most part! Ugh! I don't know, seemed to my like GM was beginning to see the light. If they can make an efficient vvt pushrod engine, more power to them. But it just seems that it'd be easy to go the proven DOHC track. I've got to say, the G6 and the Malibu aren't THAT bad. I was anxious to see what the Malibu SS looked like. FWD/RWD yes it is important to most enthusiasts but I don't think people buying most chevys and pontiacs really care. They just want a care that doesn't breakdown.
 
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To me, it seems that the root cause of GM's problems is that it's been run by accountants & finance people instead of 'car people.' These are people who are only interested in 'maximizing shareholder value' and stock value, not producing vehicles that consumers actually want to buy. They don't seem to be able to see any further than next years balance sheet. Yes, GM does produce some desirable cars (eg Corvette), but these are only a small percentage of its total output. Virtually the same thing happened to the British car industry in the 1980s, although the rot set in during the 1970s, due to incompetent management, militant unions (and ill advised government meddling). The result? All of Britain’s major car companies and factories are now owned by foriegn car manufacturers.
 
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"Many years ago, when WalMart was a small, local chain, Sam Walton told his managers, "...go to your competition. Look at what they're doing right. AND THEN COPY THEM!" Does this management philosophy work? Look at where WalMart is today. Whatever your feelings about WalMart, the fact remains, they're solvent." Walmart proves that if it's cheap enough people buy it, in the case of Walmart they'll sell out local retailers and manufacturers for cheap Chinese goods. GM did well with their sales, but it was essentially at a loss. The US market is fairly sensitive to price and insensitive to performance, which is why Honda and I think to a lesser degree Toyota have fared well in the US market but have had a harder time in Europe.
 
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GM's management is too important to be bothered with customers. Like Paranoil says, GM's job is to make a profit for the customer, the shareholder. The fact that they make cars is just an unimportant detail. Because of that, like Jonny Z says, they have become a retirement home. The solution, hire Rodger Penske and start making good cars.
 

John K

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I thought Bob Lutz was supposed to be a car guy and change the corporate mind set? I am still curious about the fact that fewer parts are involved with a pushrod engine. I can't figure out how you can come up with $800 in savings. Maybe part of it is labor. I think I understand the inner workings of engines pretty well, it just doesn't seem you could come up with such a high difference. It also makes me look at car makers that install DOHC engines and wonder how they can do it and remain competitive in the market place. Any thoughts?
 
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I do not fault GM. I think the fix was in for GM once the imports came in, took market share, and never stopped. GM had zero chance to lock the Japanese out of the market... even if GM had done the best possible job, a free market values competition, and more competitors WILL take market share away from you. Once GM had large, FIXED medical costs and large FIXED pension costs with a shrinking market share (that they could have done more to hold onto, but COULD NOT have prevented) there was no way for them to remain solvent long-term. GM's probable future insolvency was nearly impossible to prevent. The only way I can see for GM to continue to producing cars is to go bankrupt, lose its obligations to the unions and retirees, lose its cash, and have the government say that they're allowed to keep their plants and intellectual property. (Chrysler-1984 style.) Of course, if GM can't make money on a facility, the government should just sell that part off and give the money to GM's creditors in the fashion prescribed by law. If GM didn't have its existing benefits obligations and has or will have competent management, it has at least a shot at continuing to make cars. Since their bargaining position is basically terrible, the unions WOULD NOT be able to get the kind of sweet deal from GM post-bankruptcy they have now. This would leave them in the position of having substantial manufacturing assets, lots of brand equity (for some vehicles) and gobs of intellectual property and blueprints. If they cut their product lines to the top 75% most profitable at their most efficient plants and kept their corporate management/overhead lean, they could certainly make money. Perhaps that 75% should be 50% or 25%, but you get the idea. GM *can* make money, they just need to cut overhead and shrink their model line-up to the stuff they make good money on.
 
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LOL, especially since Honda and Toyota make a much higher profit per car than GM! Oh, wait, I guess GM's money goes to healthcare. GM kills me w/ their resistance to DOHC. They proclaim how wonderful the pushrod engine is (and yes, there are advantages) yet whenever they develop a DOHC V-6, they call it their "high feature" V-6. LOL, can't have it both ways!!! Lutz got reeled in by Waggoner a while back when the new rwd platform got axed. I'm just tired of GM and Ford being followers and not leaders these days. I wish Daimler had bought them out instead of Chrylser...
 
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They should call it the "hype feature" V6, as it seems to me that DOHC has been really hyped up. Sure, it has some advantages, but you've got people who don't even know what DOHC means who think it's "better". Better how? They dunno, it just is. As far as the cost of OHV vs. DOHC, consider the cost of a camshaft (which is roughly $250 or so) and then consider the fact that a Vx DOHC engine needs 3 more of them. That's $750 right there, if the camshafts are $250 each.
 
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"The only way I can see for GM to continue to producing cars is to go bankrupt, lose its obligations to the unions and retirees, lose its cash, and have the government say that they're allowed to keep their plants and intellectual property. (Chrysler-1984 style.)" I predict 2007 as the year they file for bankruptcy. They will spend 2006 setting things up for the best possible (for the corporation) outcome. I further predict that only Chevy and Cadillac will remain as identifiable U.S. brands. Pontiac, Buick, GMC & Saturn will be sold off or incorporated into Chevy & Cadillac. A smaller, leaner GM, unburdened of its union obligations, will likely seek to partner with upstarts from China and Indonesia. I suspect that this will be in the form of either rebadging vehicles to be sold as "Chevy" or creating a new arm of GM that focuses on marketing and distribution of these relatively unknown (in the U.S. ) automobiles. This is just speculation on my part, of course. But that's where I see GM heading. Glen
 
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$800 vs. the same size of DOHC, or one of similar output? I've got nothing against pushrod engines, and most people would never know the difference. I like how smooth my DOHC is at 7000rpm, but I'd certainly be willing to drive a pushrod with the same power as long as it's reasonably smooth near redline. There was a good article in Motor Trend (I believe) a little while ago which talked about the savings in cost, weight, complexity, and space with a pushrod vs. OHC design. [ December 05, 2005, 08:06 PM: Message edited by: rpn453 ]
 
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