General Motors deserves to die.

Nov 11 2008

My industry is in large part driven by automotive sales. So when I say that General Motors deserves to die, I say it despite the negative impact it will have on my well-being.

But it really does deserve to die. Much like Chrysler deserved to die (but got government money instead) and now appears to be ready to die again (or more likely get government money instead).

General Motors has been manufacturing cars that are less reliable, less enjoyable, less comfortable, and less well-engineered than its Japanese counterparts for decades now. Decades! They’ve had this long to re-engineer, re-tool, re-design, and re-brand. They’ve had their chance. They’ve made vehicles that fewer and fewer people actually want to buy, and while their Japanese competition have been putting out solid vehicle after solid vehicle, General Motors has been chasing market trends around and failing time after time to actually catch those trends. When the market wants small cars, GM invests in SUVs, pickups, and crossover utility vehicles; when the market wants SUVs, pickups, and crossover vehicles, GM has just figured out that they’ve made a few too many small cars.

Contrast this approach to Toyota, who practically created the hybrid market before oil even reached sky-high prices earlier this year! Toyota is predicting or creating markets, while GM is (unsuccessfully) chasing them around. And while GM tries desperately to re-tool, Toyota has cornered the market.

It must have come as a shock to Toyota when GM announced the Chevy Volt, it really must have. GM doing something before the Japanese? Unheard of. Yet the Volt is still — still! — just a concept car without a marketable prototype.

The one single GM product that could spark some life into its flaccid branding, and it’s not even a production car, or even close. The one thing. All the while GM has to decide what to do with its insane pension and medical load, deal with cratering sales in the US market, production costs that haven’t gone down due in large part to ridiculous collective bargaining agreements with unions who have done more harm (by far!) than good, and a general public who sees them mostly as a cheaper, crappier alternative to the Japanese brands.

I think we got into this mess with a lot of short-term thinking. A lot, a lot of short-term thinking. I think we got into this mess because GM has been chasing the market instead of being the market. GM has never learned how to do something well and keep doing it well. Toyota, who used to be a joke of a brand, has consistently proven that it wants to — even if it’s just perception and not reality, even with that caveat — do something well. Whether it does or not is a good question, but whether or not it does is moot, since people think it does. That’s all that matters.

Honestly, I wouldn’t buy a GM vehicle any more. My wife’s Sunfire is a testament to the general inattentive and slovenly design and manufacturing practices GM is rightly known for: it’s neither fun to drive, nor nice to look at, nor able to drive 10,000 km without something or other failing, nor worth anything at resale. It seems designed by gorillas, engineered by apes, put together by monkeys, and generally not worth two bananas.

If my own GM experience has been that bad, is it any surprise that that the public at large are now voting with their dollars and saying that their experience has been that bad too?

General Motors deserves to die. It probably won’t: the governments of our various countries will prop up the guttering skeleton until Ford, GM, and Chrysler together are a third of what GM was ten years ago, because we as MPD socialist/capitalist countries seem to believe in privatizing profits and nationalizing losses. But at the end of the day GM richly deserves to be consigned to the dust-heap of history, as hard as that may be to see.

8 responses so far

  1. i agree. businesses which cannot run themselves properly have to die. and it frustrates me so much that they’re only propped up, merely delaying their inevitable collapse.

  2. I see it from both sides really. I think GM richly deserved consignment to the dust heap of history. But I also know the absolute devastation that would ensue if a company that large went under.

    What the government really should be doing is loaning them the money with some gigantic strings attached. Make sure, for instance, that this money is going to research into hybrid/plug-in/greener vehicles. Make sure GM starts re-tooling in order to sell what people want to buy.

    The government then needs to make sure that the regulatory environment favours those cars and not gas-guzzling SUVs. Make buying an SUV or a car with bad fuel economy a punitive experience in order to really capture its economic and environmental consequences. Those people that need an SUV should of course be able to opt out of this, but so few people actually need an SUV.

  3. I agree that it needs to be punitive.

    I also think that the Feds should just say, “Okay, we’re going to commit to buy a bunch of vehicles from you, Detroit. Gas-electric hybrids. Plug-in hybrids. That’s it. We’re not buying anything unsustainable over the next four years. Build it, and we will buy.” And if all of government went to that, the market would be big enough for Detroit to re-tool, and then the problem’s largely solved.

    Then the rest of the problem comes when Obama pushes through a more nationalized health-care system, driving away one of Detroit’s big cost bogeys.

  4. That’s one thing I’ve never understood with the Big Three. If health care costs are such a big deal in the US, why not move more of your production and assembly to Ontario? We’ve got public health care here.

  5. Provincialism. Unions.

  6. [...] Elsewhere in Dreams » Blog Archive » General Motors deserves to die. I can't believe Dan even had to ask. (tags: gfmorris_comment) [...]

  7. I’m thinking of copying some of this stuff into an email to my senators. Is that cool?

  8. Sure.

    As long as you use the line about monkeys, apes, and gorillas.

    (I kid, I kid, you may copy and paste what you like.)

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