The Big 3 business model is broken--see Bill Heard

[XS650]

A past auto company CEO on bailouts.

Quote:
Let them fail; let everybody fail. I made my fortune when I had nothing to start with, by myself and my own ideas. Let other people do the same thing. If I lose everything in the collapse of our financial structure, I will start in at the beginning and build it up again.

--Henry Ford, 1934

 

[GMBoy]

Originally Posted By: XS650
A past auto company CEO on bailouts.

Quote:
Let them fail; let everybody fail. I made my fortune when I had nothing to start with, by myself and my own ideas. Let other people do the same thing. If I lose everything in the collapse of our financial structure, I will start in at the beginning and build it up again.

--Henry Ford, 1934



That's a cool quote - very true and humbling. Thanks for posting that one. Goes with the current issues, too. (See I really am open minded!

)

 

[heathenbrewing]

Originally Posted By: ToyotaNSaturn
Originally Posted By: heathenbrewing
The Big 3 are run by greedy CEO's that look at how to fatten their paycheck...
We need a shoe throwing moment here.


Yes, thrown at YOU for such drivel. I'm soooo sick of hearing about greedy CEO's, how great Japan is "noble", how big vehicles are the bain to our existence, how the U.S. is awful, we all suck, we want big cars, that's not noble.

How many times are we going to hear about how terrible we are as a society, how terrible our choices are??


"Those who cannot remember the past are condemned to repeat it."
-George Santayana

We should continue to hear it until we finally learn.

Even if they give the auto industry tens of billions in bailout -- where are they coming up with all this money anyway? -- it won't mean the auto industry will not layoff another round of workers. They will. This bailout is to save the greedy CEOs and Execs who are making millions and don't deserve it.

Why is the American auto industry in trouble? Because they make bad cars. They knew in 1974, after the Arab Oil Embargo, that Oil was going to be a problem. And still, they refused to make better and cheaper and more gas efficient cars. Instead, they made cars that appealed to the macho-image of some. Gas-guzzlers that cost a fortune and padded the profits of the auto industry CEOs and executives.

Now, because they did a lousy job of running their companies, they want the American taxpayers to bail them out? Are you kidding me? If the CEO of a company -- even the owner -- mismanaged a company so bad that it was on the verge of collapse. THEY WOULD BE FIRED. So, fire them first before you get them one red cent.

Foreign car makers are doing what American car makers were to greedy and arrogant to do. They make better, more reliable cars. And, you can bet the first real energy efficient cars that make real progress in conserving gasoline usage will come not from the US but from the foreign countries. American auto makers are producing "energy efficient" cars that are barely energy efficient and that have been designed for profits not performance.

 

[ToyotaNSaturn]

Originally Posted By: heathenbrewing
"Those who cannot remember the past are condemned to repeat it."
-George Santayana

We should continue to hear it until we finally learn.


That has nothing to do with this conversation.


Originally Posted By: heathenbrewing

Why is the American auto industry in trouble? Because they make bad cars.

They do? LOL You better canvass the populous of people who have Big 3 cars/trucks on this board who have well over 100K/200K on them. Are these cars the reason why the Big 3 are in trouble or are these owners just "lucky"?


Originally Posted By: heathenbrewing
Now, because they did a lousy job of running their companies, they want the American taxpayers to bail them out? Are you kidding me? If the CEO of a company -- even the owner -- mismanaged a company so bad that it was on the verge of collapse. THEY WOULD BE FIRED. So, fire them first before you get them one red cent.

I agree with you, but that's not the case recently. Any large business can go to Congress hat-in-hand looking for help funded by the taxpayer. Sad, really.


Originally Posted By: heathenbrewing
Foreign car makers are doing what American car makers were to greedy and arrogant to do. They make better, more reliable cars

[censored]. I've had foreign & domestics that were good & bad. I had a Toyota Sienna, it was a lemon. It's the perception of better quality that drives the masses to the dealers. Sure, Toyota *might* make better invididual cars, but search around the net for problems with Camry's, Siennas, Tundras, Taco's, you get the full picture, not just the emotional perception.

You have left out the most important item, by far, in your assessment: the UAW. The incredible labor & health insurance costs have brought this company to it's knees but you graciously forget about this only to slam the CEO's. Your opinion is unbalanced at bast.

 

[XS650]

Originally Posted By: heathenbrewing


"Those who cannot remember the past are condemned to repeat it."
-George Santayana




My high school US History teacher used to say

"Those who do not learn history are doomed to repeat my class"

 

[c3po]

I remember when I bought a used Chevrolet El Camino back in 1985 with 25,000 miles, the salesman said, you should get 150,000 miles out of this car, it was a 1983 model.

I remember at 100,000 miles, the EGR vale was clogged as well as the port in the intake manifold. My mechanic friend said, we are not going to put another 1 in, because you will have the problem again. I eliminated the EGR valve and put on an intake manifold with no egr provision and capped off the pipe that went to the exhaust manifolds, when I put headers on, the pipe plug that restricted the exhaust was totally crudded up.

The car ran better with no EGR valve, and I think that the emmisions equipment in the 1980's that GM had was junk. I also replaced many parts and the car ran better, here are some parts:

1) Non emission carburetor
2) Non emission distributor
3) Non emission intake manifold
4) Edelbrock Water Pump
5) Aluminum Radiator
6) New pushrods
7) New rocker arms
8) Better Timing Chain

I mention the timing chain because the original 1 had NYLON GEARS, obviously I put a timing chain on with metal gears.

I also replaced the PCV every year. My Dad has a 1979 Pontiac Bonneville with 200,000 miles that is still going, but the only emmisions device is the PCV.

I also replaced the valve seals at 364,000 miles.

I have done a lot of work on this engine, but what has me annoyed is that I know a few guys that had japanese cars from the early 1980's and have gone well over 300,000 miles with only routine maintenance.

I will not tell you what I did when my converter clogged, but after getting rid of all the emmisions junk, I still passed emmisions and the hydrocarbons were the same.

I believe there was an article in Hot Rod magazine back in 1977 or so that did an emmisions test with the converter and without, and the emmisions were the same.

GM is also notorious for building cars in the 1980's with restrictive exhausts, except maybe for the Corvette. I had a single exhaust with a Y-Pipe. 1 of the pipes went underneath my oil pan and then up on a 45 degree angle to meet the other pipe that went down to the single exhaust.

I eventually ran dual pipes off the manifolds, basically a true dual exhaust and the car ran with some more power and it was no longer a slug. The shorty headers woke it up some more.

There are very few people who have done what I have done on a 1980's small block chevy engine. Every part I have replaced has been better than what GM put on the car, and the stuff they put on that I took off made it better.

Too many people remember how junky these american cars were back in the day, maybe they are good today, but too many people are happy with there foreign cars.

I am sorry but the Big 3 seem to want people to buy new cars every couple of years, trade there old car in so they can resell it and make some money. That's fine if a new car only costs $4000.00, not when it costs $25,000 or more.

Imagine what will happen in a few years when the Chinese start making cars, Hyundai was once a joke, but not anymore.

I just feel that foreign cars hold up better in the long run, and I know a lot of people agree with this statement.

I heard that when the Chinese start making cars, they will be about $10,000, and from what I heard on the news a while back, these will be the high end cars.

 

[heathenbrewing]

Originally Posted By: ToyotaNSaturn

[censored]. I've had foreign & domestics that were good & bad. I had a Toyota Sienna, it was a lemon. It's the perception of better quality that drives the masses to the dealers. Sure, Toyota *might* make better invididual cars, but search around the net for problems with Camry's, Siennas, Tundras, Taco's, you get the full picture, not just the emotional perception.


I feel that perception is reality. The general perception is that Japanese cars are "better" than American made cars. Why?

Reputation: Toyota has, by now, had a lifetime to cement its reputation among American consumers for nearly fool-proof quality. GM and Ford spent nearly as long honing a reputation for not caring much about quality. Things may have improved, but it takes a long time for that to sink in.

Recalls: GM, in particular, has had a problem with headline-making recalls. It's a big company, it sells a lot of vehicles and they share a lot of components. When one of those parts goes wrong, eye-popping numbers of vehicles can be affected. That doesn't necessarily mean the vehicles are unreliable. Recalls are a different sort of problem. But it does cause concerns.

Reviews: GM and Ford vehicles haven't always exuded the quality that may have been hiding in there somewhere. Cheap-feeling interior materials, raspy-sounding engines and gap-filled construction didn't give potential buyers the feeling of confidence that even lesser Japanese brands manage to carry off.

Resale Value: American cars just dont hold their value in the resale market. Why? Perception. Perception is reality.

 

[RoGuE]

I will say my local Bill Heard (Buford, GA) never seemed to be a problem. We always had great service there with all 3 cars we bought from there.

 

[ViragoBry]

I remember with no fondness the 1982 Chevy Silverado my parents bought when I was 12. What a wretched piece of junk that truck was. We didn't discover until after the paperwork was signed and we'd owned it for about a week that there was a HUGE gap between the lower edge of the passenger door and the rocker panel. The bottom of the door appeared as if the door wasn't latched, when in fact it was.

Our dealership's fix? Bend the door into the proper shape. They ended up bending a concave dent into the door's middle section while they were at it, so we got a whole new door about a month later. The clincher? The paint didn't match very well.

Wind noise around the wing windows was a huge problem. Our dealership's fix? Squirt some black goo around the seals and hope we never used the wing windows. Guess what...we used them. The wind noise returned as soon as the black goo became dislodged.

About 6 months later, I got ambitious one weekend and volunteered to wax the truck. At that time we discovered that what little paint there was on the roof came off with the wax. We could literally see bare metal on the roof after a coat of Turtle Wax was applied and buffed off.

The final straw was some sort of dangerous running problem the engine developed out of the clear blue sky. It would accelerate initially, but then the bottom would drop out for about 10 seconds, and it it would resume accelerating. Nobody ever found the problem, and it continued to get worse.

This was the first vehicle my parents had EVER gotten rid of before it was paid off.

What helped the case for Japanese cars in my family is that this truck was traded for a 1985 Honda Accord SEi, which still stands as the most trouble-free car my parents ever owned.

Situations like this probably have a lot to do with people's presumptions about current American models. We can't be the only family of Americans to experience this. I don't think quality issues like we found in that truck still exist, but I think they've still got some ground to make up, as well as some work ahead of them to change everyones' minds.

 

[brianl703]

Originally Posted By: Audi Junkie
Property taxes on those big dealerships must be huge, they are usually prime commercial.


Hehehe....this reminds me of a comparison I did with the assessed value of my residential property vs. an equally-valued commercial property (in assessment year 2000) in the same city. As of 2006, my residential property was assessed far higher than the commercial property.

There was no bubble with commercial property, or if there was, it was very much smaller than the residential bubble.

 

[brianl703]

Originally Posted By: c3po

I will not tell you what I did when my converter clogged, but after getting rid of all the emmisions junk, I still passed emmisions and the hydrocarbons were the same.

I believe there was an article in Hot Rod magazine back in 1977 or so that did an emmisions test with the converter and without, and the emmisions were the same.


In 1977 that was almost certainly a two-speed idle test. Fast forward 20 years later and they use a dyno test (tests the engine under load) which is much better at catching vehicles with emissions problems. For one thing, the dyno test can tell if the vehicle is producing too much Nox, not just if it's producing too much HC or CO.

 

[lovcom]

Originally Posted By: exranger06
Originally Posted By: lovcom
True, but you have to also blame the consumers that continue to buy domestic [censored], year after year, even after reading many bad reviews, and MANY issues ConsumerReports and many other organizations have had with domestic cars. I find it most peculiar that many American's over the decades continue to enable the big three even as hey continue to build [censored].

Amazing!

And don't forget the UAW...they too have thier share of blame for helping to drive the big three into the ground.


Stop living in the 90s. The domestics DON'T build [censored] anymore. It's because of people like you that they're not doing well. Just because they had a bad experience 15 years ago, they think the company is doomed to making [censored] forever. There is such thing as improvement. Although, maybe I shouldn't talk, since my 92 Accord is one of the main reasons I think the Japanese cars are some of the most overrated vehicles in the world...


You need to start living in 2008. TODAY, yes TODAY, the domestics still make mostly [censored] cars...forget about the '90s, TODAY they make [censored] (mostly) and it is domestic makers like them that caused their financial mess...and how can you blame people like me, that buy Japanese?

My 2003 Ford Expedition was [censored]...back to the dealer for fixes 5 times before 19,000 miles, and it needed the drive shaft replaced, and the auto-tranny too!

My 2006 Ford Mustang had to go back for fixing 8 times before reaching 26,000 miles!

Of the 5+ Hondas and Toyotas I've had in my life NONE had any problem before 150,000 miles.

So please don't be foolish enough to blame us Japanese car buyers for the domestic's problems today.

The reason the big domestic 3 have problems today is because they share your same exact opinions and mindsets...you and them, all of your are dillusional, and don't want to admit that the cause of the big 3 issues is them, and them ONLY.

What is amazing that to this day, GM's Wagoner sees nothing that would suggest GM made any mistakes. He is such a "victim"...you and him would be great pals.

It is UN-American to make crud products, and it is UN-American to buy crud products. It is UN-American to bailt out crud companies.

Therefore the most patriotic true Americans will not buy domestic cars UNTIL they start building high quality products.

 

[Cutehumor]

"Therefore the most patriotic true Americans will not buy domestic cars UNTIL they start building high quality products"

Would the big 3 have to be the "car of the year", "SUV of the year" "Truck of the year" for every major award before people come back to buy? or until the Foreign brands start putting out junk?

 

[heathenbrewing]

Personally, I think it is too late. The damage (justified or not) is done, and public perception is that American cars = much less quality that Japanese cars.

I would like to see the Big 3 (Big 2?) go under and a new company/ies emerge. A brand new company with brand new styling ideas and a brand new leadership.

 

[heathenbrewing]

Originally Posted By: heathenbrewing
"Those who cannot remember the past are condemned to repeat it."
-George Santayana

We should continue to hear it until we finally learn.


Originally Posted By: ToyotaNSaturn

That has nothing to do with this conversation.


Actually, if you think about it, it has a lot to do with this conversation. American quality (or lack thereof) is nothing new.



Originally Posted By: heathenbrewing

Why is the American auto industry in trouble? Because they make bad cars.


Originally Posted By: ToyotaNSaturn
They do? LOL You better canvass the populous of people who have Big 3 cars/trucks on this board who have well over 100K/200K on them. Are these cars the reason why the Big 3 are in trouble or are these owners just "lucky"?


Why just this board? You know as well as I that this board makes up much less than 5% of all Big 3 owners in America. The people on this board are (generally) anal about proper maintenance and by no means give an accurate portrayal of average car quality. Consumer Reports paints an entirely different picture on the quality of American autos.

I hear more complaints about American cars than Japanese ones. Friends, associates – the majority say American cars lag behind imports. I do believe that this is the typical view held by a majority of Americans.


Originally Posted By: ToyotaNSaturn
You have left out the most important item, by far, in your assessment: the UAW. The incredible labor & health insurance costs have brought this company to it's knees but you graciously forget about this only to slam the CEO's. Your opinion is unbalanced at bast.


By no means do I think the UAW are blameless, I just feel the corporate side is more to blame. I am anti-Union and will continue to be for as long as I can see.

 

[mpvue]

Originally Posted By: lovcom
Originally Posted By: exranger06
Originally Posted By: lovcom
True, but you have to also blame the consumers that continue to buy domestic [censored], year after year, even after reading many bad reviews, and MANY issues ConsumerReports and many other organizations have had with domestic cars. I find it most peculiar that many American's over the decades continue to enable the big three even as hey continue to build [censored].

Amazing!

And don't forget the UAW...they too have thier share of blame for helping to drive the big three into the ground.


Stop living in the 90s. The domestics DON'T build [censored] anymore. It's because of people like you that they're not doing well. Just because they had a bad experience 15 years ago, they think the company is doomed to making [censored] forever. There is such thing as improvement. Although, maybe I shouldn't talk, since my 92 Accord is one of the main reasons I think the Japanese cars are some of the most overrated vehicles in the world...


You need to start living in 2008. TODAY, yes TODAY, the domestics still make mostly [censored] cars...forget about the '90s, TODAY they make [censored] (mostly) and it is domestic makers like them that caused their financial mess...and how can you blame people like me, that buy Japanese?

My 2003 Ford Expedition was [censored]...back to the dealer for fixes 5 times before 19,000 miles, and it needed the drive shaft replaced, and the auto-tranny too!

My 2006 Ford Mustang had to go back for fixing 8 times before reaching 26,000 miles!

Of the 5+ Hondas and Toyotas I've had in my life NONE had any problem before 150,000 miles.

So please don't be foolish enough to blame us Japanese car buyers for the domestic's problems today.

The reason the big domestic 3 have problems today is because they share your same exact opinions and mindsets...you and them, all of your are dillusional, and don't want to admit that the cause of the big 3 issues is them, and them ONLY.

What is amazing that to this day, GM's Wagoner sees nothing that would suggest GM made any mistakes. He is such a "victim"...you and him would be great pals.

It is UN-American to make crud products, and it is UN-American to buy crud products. It is UN-American to bailt out crud companies.

Therefore the most patriotic true Americans will not buy domestic cars UNTIL they start building high quality products.


you've had 2 fords w/ problems, therefore domestics are junk.
you've had 5 plus hondas and toyotas w/o problems, therefore imports are great.
thank you for your insight.
in MY world, I've had imports w/ many issues, and a few domestics that run great, so I guess all imports suck, domestics are great, or did I just get lucky 6 times?

really, I've said it before, but all mfgrs have the capacity to produce chrap, and all can make great cars. I'm not going to write off Germany because my golf was a PO S, nor Japan because my mazda is always in the shop, just like I'm not going to assume everything the big3 make is great because my saturns have been fantastic.
don't be so small minded.

 

[OVERKILL]

Originally Posted By: lovcom
Originally Posted By: exranger06
Originally Posted By: lovcom
True, but you have to also blame the consumers that continue to buy domestic [censored], year after year, even after reading many bad reviews, and MANY issues ConsumerReports and many other organizations have had with domestic cars. I find it most peculiar that many American's over the decades continue to enable the big three even as hey continue to build [censored].

Amazing!

And don't forget the UAW...they too have thier share of blame for helping to drive the big three into the ground.


Stop living in the 90s. The domestics DON'T build [censored] anymore. It's because of people like you that they're not doing well. Just because they had a bad experience 15 years ago, they think the company is doomed to making [censored] forever. There is such thing as improvement. Although, maybe I shouldn't talk, since my 92 Accord is one of the main reasons I think the Japanese cars are some of the most overrated vehicles in the world...


You need to start living in 2008. TODAY, yes TODAY, the domestics still make mostly [censored] cars...forget about the '90s, TODAY they make [censored] (mostly) and it is domestic makers like them that caused their financial mess...and how can you blame people like me, that buy Japanese?

My 2003 Ford Expedition was [censored]...back to the dealer for fixes 5 times before 19,000 miles, and it needed the drive shaft replaced, and the auto-tranny too!

My 2006 Ford Mustang had to go back for fixing 8 times before reaching 26,000 miles!

Of the 5+ Hondas and Toyotas I've had in my life NONE had any problem before 150,000 miles.

So please don't be foolish enough to blame us Japanese car buyers for the domestic's problems today.

The reason the big domestic 3 have problems today is because they share your same exact opinions and mindsets...you and them, all of your are dillusional, and don't want to admit that the cause of the big 3 issues is them, and them ONLY.

What is amazing that to this day, GM's Wagoner sees nothing that would suggest GM made any mistakes. He is such a "victim"...you and him would be great pals.

It is UN-American to make crud products, and it is UN-American to buy crud products. It is UN-American to bailt out crud companies.

Therefore the most patriotic true Americans will not buy domestic cars UNTIL they start building high quality products.


So, my Mustang with 330,000Km on it was a fluke? And so are all the other ones in the Mustang clubs (the largest group of car guys in the world) as well?

The TWO Expeditions we've owned (98 and 2000, still have the 2000) are flukes?

Or perhaps you are lucky your Toyota didn't suffer from sludge death.....

Or your Honda suffer from auto tranny failure........

But that's right, the Japanese cars cannot have problems.

My family has been buying Ford since the beginning. You've shown your bias, I'm sure you are aware of mine. Of course I have three generations of bias dating back to the model A to fall back on..... I'm not looking at a tiny cross section of vehicles and judging an entire industry based on that.

I've been in some great Honda's and some not so great ones. I've been in some pretty awful Toyota's and some decent ones. I've owned lots of great Fords. My entire family has. That's why we continue to buy them.

 

[ToyotaNSaturn]

Originally Posted By: OVERK1LL
I've owned lots of great Fords. My entire family has. That's why we continue to buy them.


But this evidence doesn't matter to those who think the Big 3 cars are just plain [censored].

I worked in Ford L/M parts for years. We saw lotsa [censored] come in the shop. But it was the cars we didn't see...the '86 Taurus 3.0L with 170K than an owner traded for a newer one, circa '91. Those are the cars that were made on the same assembly line along with the claimed [censored] cars.

Yes, some are lemons, no doubt, I've owned one. But that doesn't mean the entire company sucks. Even eMachines makes computers that last more than 2 years!

 

[Gannet167]

Originally Posted By: lovcom
you have to also blame the consumers that continue to buy domestic [censored], year after year, even after reading many bad reviews, and MANY issues ConsumerReports and many other organizations have had with domestic cars. I find it most peculiar that many American's over the decades continue to enable the big three even as hey continue to build [censored].

Amazing!

And don't forget the UAW...they too have thier share of blame for helping to drive the big three into the ground.



Quite true, consumer demand is the ultimate test of success in the market. It no one wants to buy your widget - that means you've failed and the competitor product has won.

Pick up a copy of ConsumerReports - it's a very accurate and scientifically done statistical analysis of vehicle repair frequency. You will immediately notice that the American companies have many models with atrocious quality. Sure, there's a few that are ok, good even. But year after year after year the same component will get the lowest possible rating for reliability. They don't fix the engineering problem because it makes them money. How many Windstar transmissions self destructed into an aluminum milkshake about 1000 miles after the warranty expired? Coincidence???

Strangely, the "import" cars have very clean ratings - generally speaking. Compare a Civic's nearly spotless rating to an Escort/ZX3, Cobalt/Cavalier, or Neon. It's like night an day. No wonder the Civic is the best selling car in America. I say "import" because many, if not most "imports" are made in North America, including the Civic.

The big 3 continually get torn apart in AMERICAN auto magazines like Car and Driver etc. I clearly remember them printing "there's nothing wrong with GM's sedans ... that a complete redesign couldn't fix." It's almost comical how AMERICAN experts tear apart with classic sarcasm the ridiculous notions of design and quality.

Anyone's individual story of how their whole family for the past XX years has blindly only bought brand X and had absolutely nothing but excellent luck with them is pointless. You and you're irrational fundamentalist loyalty is not going to save Ford. It's the whole market which as a whole, has rejected Ford and the others.

The big 3 failed to realize that a business plan based on selling replacement parts and repairs, and another cheap new car in 5 years, is not a good plan.

 

[GMBoy]

"Pick up a copy of ConsumerReports - it's a very accurate and scientifically done statistical analysis of vehicle repair frequency."


THIS IS A COMPLETE JOKE! It is soley based on CR subscribers surveys. That's it. That us a small sample size and who knows if people are telling the truth.

These are the same people that rated the GEO Prism as unacceptable/poor reliabilty while the sister Toyota car was raved about. Both built in the same line with same parts except for the badges.