Haven’t we seen all this before?
In the 70s, American cars were, largely, crap. The solid workmanship of the 50s-60s had been skimped on over and over, and big, ugly, clunky, low quality cars from Detroit were basically where it was at. US auto executives figured they had the market locked, so why bother with anything else?
It amazes me how corporate executives can be so ignorant of economics.
The energy crisis made existing US cars dinosaurs, and the buying public discovered that “Made in Japan” didn’t mean cheap claptrap, but quality. Pieces that didn’t fall off. Systems that operated efficiently and with longevity. Cars that retained their value. European vehicles, too, started making inroads, but it was the Japanese auto makers that put Detroit’s market share into a tail spin, not just with gas-efficient cars (I still remember my Dad’s turquoise Datsun B210, which got something in the 40s for mileage), but with trucks, sedans, and eventually luxury cars.
Suddenly, US auto makers saw the light. They looked at the Japanese, their business practices, their quality practices, their innovation, their automation. It was expensive and difficult, but US cars began to compete again. Folks could talk about the “bad old days” of US auto making, and if there were still quality issues, the gap between US cars and foreign cars was perceived to be much more narrow …
And then, all of a sudden, in the 90s Americans decided they wanted to buy big trucks and SUVs. And, some measure of competition notwithstanding, those turned out to be uniquely American manufactures.
And, once again, Detroit figured they had a lock on the market. The SUV bubble would last forever. That’s what folks wanted, so as long as Detroit cranked them out, the rest of the market could go hang. Besides, that quality stuff is expensive. Give ’em ever-larger SUVs, Detroit thought, and it doesn’t make any difference what snaps off or fails inside of six months.
Guess what?
Americans have, just as suddenly, decided that SUVs and big trucks are a lot less attractive in an era of $2.50/gal. gasoline. Imagine that. It’s Econ 101 all over again. And, with the decline (if not collapse) of the Honkin’ Big Vehicle market, US auto manufacturers find they’re competing on quality again.
And, again, they suck at it.
DOF has the answer. It’s remarkably clever (and not a little vindictive, but in a just and “incentivizing” way).
American car companies should buy fleets of ten-year-old cars, all different brands foreign and domestic, and make their executives drive a different one to work every day.
(Imagined scene: child in car asks; “Mommy, why is that bald man in the car next to us yelling at his radio?”)
I like it.
It’s…too…late.