What Ruined the Big Three
A quick description of the events that brought America’s Big Three automakers to their knees. First, they had to assume responsiblities assumed by governments in other developed countries. Second, they were not quick enough to respond to changing demands, causing them to lose market share to the Japanese. Having lost market share but having assumed responsbilities usually shouldered by governments, they were preassured for money and neglected R&D, engaged in badge engineering. Third, they did not prepare for the end of cheap gas and the SUV craze – Toyota did, and, despite exploiting the SUV craze as well, prepared by fostering a green image through bringing cars like the Prius to the market, even though they were not profitable in the short run.
Duration : 0:3:11
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Tags: American, auto industry, Bailout, Big Three, car makers, Detriot, economics, Economy, Japanese, management, Politics, recession, suv, toyota, U.S., welfare state
March 6th, 2010 at 2:52 pm
Yes, GM has too …
Yes, GM has too many makes for one company where in Asia each company stands on its own.
March 6th, 2010 at 2:52 pm
Your videos …
Your videos demonstrate substantial thought, and you speak with a neutral and informative tone.
Thanks. (I just subscribed today)
If i may highlight your point about short-run/long-run goals and the Prius not being a profitable car at its initial release. GM developed the EV1 a few years ago–the first major production electric car–, and it wasn’t profitable either. GM discontinued its car, and Toyota didn’t.
March 6th, 2010 at 2:52 pm
Well, there’s the …
Well, there’s the Tahoe/Yukon/Escalade Club, but I think you pretty much got it.
March 6th, 2010 at 2:52 pm
I agree with you …
I agree with you about the badge engineering-I mean, who the needs a Buick Terraza when there’s a Chevrolet Uplander, Saturn Relay, Oldsmobile Silhouette, and Pontiac Montana SV6? They’re all the same piece of crap car! Or how about an Isuzu Ascender when there’s a Chevrolet Trailblazer, GMC Envoy, Buick Rainier, Saab 9-7X, and Oldsmobile Bravada? Let me know if I skipped one
March 6th, 2010 at 2:52 pm
You know what …
You know what you’re saying, we need people like you.
We must remember it’s not just the big 3 hampered by benefits packages ie retirement/health, all companies are hampered by this.
This will, in time, push the zombie-like population of the US to move towards the left, calling for socialization of profits to better our society as a whole, through wise spending, community investment.
SOLIDARITY WITH WORKERS EVERYWHERE! VIVA ANARKIA!
March 6th, 2010 at 2:52 pm
Don’t worry, we all …
Don’t worry, we all have those moments. PS. It’s also an American car – I sat in the back seat, so one could see the Lincoln emblem on the front seats.
March 6th, 2010 at 2:52 pm
I feel dumb. It …
I feel dumb. It took me two minutes to figure out why you were sitting in a car. Anyway, good points.
March 6th, 2010 at 2:52 pm
USA economy = short …
USA economy = short term thinking in a long time market. Market response time depends on product prices and running costs. How could somebody – who claims to think strategically – assume, that the car market would change entirely in one or two quarters? In most cases 5-10 years will be a reasonable timeframe. The managers of corporations are mostly engaged in tactics. Strategic planning is unknown to them. Thanks to the IAS.