Three Little Pigs

Each one built their house out of straw. They saw they wolves had torches.
(Image Credits: www.thetorquereport.com, August 2, 2007)

I had originally planned on my next blog post being of a slightly less venomous, more educational and helpful nature. However, this article on The Economist ratcheted me up a notch or two. Nothing--and I mean absolutely nothing else-- on this Earth (except perhaps poor man-to-man coverage in obvious passing down situations... you're a cornerback, it's your job to jam!) riles me up like the appalling ineptitude of the American automotive industry. One particular gem is worth repeating:

Sales at GM and Chrysler have fallen by 18% and 25% respectively this year and both companies will run out of cash some time next year if they continue to use it up at the current rate. The massive losses GM and Ford reported on Friday show that the prospects are bleak for America's carmakers. - The Economist

Why? How in the name of Lee Iacocca was this possible? The following well-crafted, though biased, opinions may shock and mortify you.

Firstly, America's car companies (like American government) are short-sighted and complacent.

From 1992-1996, Ford had a slam-dunk with the Taurus. The blue oval had been teetering on the edge of oblivion (funny how history cycles like that isn't it?) and, like a golden chariot from heaven, the Taurus became the best-selling car in America. Ford was spared and had, inadvertently, created the midsized family car segment; the largest automobile class (by sales to private consumers) in the country.
So what was Ford's grand plan given their newfound perch atop the automotive heap? Keep innovating? Plan for the next big thing in the event that the (at the time) rapidly improving Japanese competitors actually caught up?

Nope, you're wrong. They kept selling the same damn thing. In fact, the Taurus was sold, with superficial modification, straight for the next decade. What had at one point in time been a massive commercial success and example of American engineering became a rental lot punchline. The saddest thing about this, of course, is that Ford did not learn its lesson. It again had a home run with the much vaunted, though terribly flawed, Explorer. Again, Ford had created a new market segment within the span of a few years. The Explorer was the granddaddy of the entire SUV boom that swept the country, and then dragged it sadly and uncontrollably down the path to irrelevancy.

I have appeared to pick on Ford a great deal in this, but GM and Chrysler are no better. GM did its best to pick up where Ford left off; to 'out Ford' Ford, if you will. Throughout the time period when the Explorer/Taurus hegemony was in full swing, GM contributed little of any real innovative value. Instead, GM took Ford's ideas and perfected them; or, perhaps, beat them to death. By the year 2000, GM's portfolio consisted of at least 10 new or recently updated trucks (Yukon, Yukon XL, Suburban, Tahoe, Sierra, Silverado, Escalade, S10, Blazer, Trailblazer, etc.). GM developed its extensive range of SUVs at the expense of its car product line. Many of the cars, particularly the Pontiac Grand Am/Oldsmobile Alero, were based on engine and chassis architecture developed in the late 1980s, or earlier. Chrysler, which had immense success when it created the minivan, did not have another success story until the 300/Dodge Magnum twins. Those, however, were just late-model Mercedes E-classes dressed up like a couple of teutonic 'yankees.' By and large, the American automakers over the past 10 years demonstrated a complete lack of foresight coupled dangerously to an adolescent and hubritic complacency.

The terrible thing about this is that the car makers acted as if the party would always last. Up until 2005, GM was developing new and 'better' versions of its SUV range, even as gas prices were precipitously beginning to rise. Not one, not a single one, of the high paid, highly-educated executive types at these car firms realized that the market that they had created was eventually going to do them in. Rather than taking their windfall success and using it to drive future development, the companies were dragged into financial disputes over union benefits and limp wristed, positively insulting attempts at rebadging the same product and foisting it upon the American public. As if this all was not crass enough, the 'big three' failed to see that their Asian and European competitors had not only caught them, but surpassed them; all while they continued believe in their own self-importance.

Which brings me to my second and final point: you do not see these other companies asking for handouts, do you?

Granted, some competing automakers are partly nationalized (a la Volkswagen; the state of Lower Saxony owns 20% of its shares) or fully so (a la Nissan, a wholly-owned subsidiary of Renault). However, this has always been viewed as a weakness by the American auto industry; bolstered by the arguably unfounded belief that socialists make for lazy workers. However, the Japanese automakers are not nationalized and are some of the most efficient and hardest working companies in the world. Toyota made headlines around the world when it surpassed GM in sales volume in the beginning of 2007. Honda, though somewhat of a rogue, consistently dominates the important midsized family car market. Both Toyota and Honda first gained popularity in the United States during the OPEC oil crisis of the early 1980's. Now, with a more lasting fuel crisis knocking on the door, they once again have seen increase after increase in sales at the expense of their elephantine US competitors.
A large measure of the supposed bailout for the American car companies is predicated on the fact that producing fuel efficient cars for the American market will require massive retooling and redistribution of resources that the giants simply do not have the cash flow for. Riddle me this, Batman, why do Toyota, Honda, VW, and Nissan not have these problems? Because they already produce fuel efficient cars that they are already selling in the US! See the Honda Fit, Toyota Yaris, VW Jetta TDI, amongst others; though, I admit that I would not want to buy a Fit given that ghastly commercial. The Jetta TDI, along with the Nissan Versa (a late-model, rebodied Renault Mégane), beg a question that has itched in the back of every gear-headed mind in the United States:

Why don't the American automakers sell their European market cars in America?!

All sorts of excuses are given and have been given by the companies. What it comes down to is power. Ford America and Ford of Europe are largely distinct companies. In fact, Ford of Europe has a completely different design office. While the two companies may draw from one parts bin, the cars that they build are strikingly different. Take, for example, the Ford Focus. See also, the European Ford Focus. These cars are not the same. The talking heads at Ford America will tell you that hatchbacks don't sell; yet Ford had a slam-dunk hit with the Mazda 3 hatch and, trust me, Volkswagen and MINI have proven that hatchbacks will sell in an America that is concerned with saving money, gas, and having a little fun.
GM sells thousands of cars under the Opel/Vauxhall brand structure in Europe that they do not sell in the United States. Take for example the Vectra, Astra, and Corsa. The Astra has since come over in the guise of a Saturn, but really, a Saturn? Furthermore, GM's woeful, badge-engineering driven product planning is what is responsible for the company's current state. Period. Who at GM thinks that positioning Pontiac against BMW, Saturn against Honda, and Buick against Lexus, makes good business sense? Who in the brain trust at Ford thinks it is a good idea to build two different cars that respond to the exact same sector of the market? Because the answer to both of those questions is, someone.

As the Economist rightly states, the state of American automakers will pose an early challenge for the President-elect. How he responds to this will be an early indication of where he will stand with respect to his promises of increasing average fuel economy in the near-term, and how serious he is with respect to improving America's global image with respect to climate change. However, throwing money at people who have demonstrated a complete and utter dearth of knowing what to do with it when they had it in the first place can lead only back around the circle. Accountability will, ultimately, rest with American consumers. To whom much has been given, much is expected. Will the American automotive industry finally do as much?

On a lighter note, there are going to fire sale prices at your area Ford, GM, and Chrysler dealers this time next year.

Dear Mr. S2000

Like a clairon bell, so were the dulcet tones of Mr. S2000 as he flew off on argentine wings into the night (Image Credits: Honda USA).

Dear Mr. S2000,

As I was running a few days ago, I was just beginning to think about how it was a nice, and peaceful, and cool evening. I was enjoying the feeling of running in the cold once again, and I was thinking about how it's even a bit nice (if a bit scary) to be running after dusk. It was the first run in gloves, cap, and running pants for me. Just then, I could hear the rising bass track of Radio 1 coming from behind. Who could be approaching but you? You, in your silver chariot, streaking by with the top down... in the 40 degree weather.
I applaud you and your British optimism, Mr. S2k. Weather be damned, you'll have that roof off because it's what you paid for. In fact, according to Tom Ford on Fifth Gear, Britons buy more convertibles than any other nation in Europe. If that isn't looking at life on the sunny side then what is? Maybe you bought your convertible because you thought it would be an investment in the future; in the macabre hope that, should global warming continue at its current rate, England will have a climate the same as Southern France does currently. Well then you won't look such a fool, will you? And besides, if you can drive around with the roof down in winter you'll be ready for anything.
I know what you're thinking: Americans are so narrow-minded. We only buy convertibles to drive them in nice weather. We don't want to get the leather wet; heck, we don't want to get wet, let alone cold. Now, with financial times what they are, convertible sales are under threat. But you, you Mr. S2k, you are enjoying a broader motoring experience than even we can dream of. Like a quicksilver beacon of light in this dark epoch, you are reminding us that consumption can still be conspicuous. Forget the fact that most convertible drivers own convertibles just to be seen in them, or that driving a Honda sports car is like having a performance refrigerator. You drive around with your music loud enough for us to identify you even at night. So kudos, Mr. S2k. Thank you for showing us that happiness is more than an illusion, if it may be perhaps, delusional.

Yours Most Humbly and Sincerely,

Will

The Car: An Human Perspective

The Soccer Mom to Her Soccer Mom Friends About Her New Escalade Hybrid:

"It's because I care about the planet."

(Image Credits: General Motors)

Buying a car is an entirely irrational exercise. Anyone who goes into it saying that he has "carefully weighed the pros and cons" and has done (my personal favorite) a "cost benefit analysis" on all the potential models in his price bracket is either a German actuary or, more likely, a liar. As humans, we carefully craft an image for ourselves; be it in clothes, in homes, and in what we do for a living. Nowhere is this brought most glaringly and obviously into light than in the case
of car buying.

Many of you are probably wondering why there are so many SUVs trundling along the highways and byways of the USA. Don't worry, there are plenty of them trundling along the roads in Europe, as well. The explanation for the SUV is found entirely in the squidgy bit behind the wheel. See if you can follow this thought process:

Need: 'I need something that can carry my family and our luggage.'
Want: 'I want something that I would draw on the margin of my 3rd grade homework.'

Need: 'It should be relatively safe.'
Want: 'It should be capable of subduing a small third-world, pre-colonial country single-handedly.'

Need: 'It should be comfortable.'
Want: 'It should have six TV screens so that my kids are quiet.'

Need: 'It should be economical.'
Want: 'It should have more horsepower than the assembled Rohirrim on the Pelennor Fields.'

...and so on.

People's car buying habits are perhaps the most vivid representation of their values. Never are one's wants so clearly juxtaposed against one's needs when personal transportation is on the menu. There is a grand unwillingness to compromise in America these days. This isn't a political blog, so I won't go there (granted, you can't expect the government to give you stuff if you don't give the government money for it first). It is not possible to have a vehicle that gets 60 miles per gallon, can seat 12 like oil sheiks, and can go 0-60 in less than four seconds. It's not pessimism saying that, it's realism.
I have no problem with people driving what they want to drive; I just wish that they would be honest about it. You didn't buy that Land Rover because you thought it was safe; you bought it because you wanted it. You bought it because you wanted to know that, if given the opportunity, you could bushwhack across the Congo on your way back from Tyson's. If you wanted something safe you could have bought a Volvo wagon, but that's Swedish and boring, It's that simple. Don't try and tell me that you bought that Porsche because it's an investment. Sure, they have great resale value, but there's more value in the enjoyment that you'll have while you own it than what you'll get back for it when you sell it. If you wanted resale, you would have bought a Honda.
As long as people are imperfect--and I can't pretend to know how long that will be--they will always be dishonest. I think that we can all do well to try and be more honest with ourselves and with one another if we start with car buying. So if you'll excuse me I've got to take a look at the cost benefit analysis for that Ferrari I've always wanted. I think the credit crunch might make financing a bit more difficult.

An Old Driver's Adage

The other day I passed a brand new Mercedes E63 AMG on the road. It was colored in that stark Mercedes silver and, of course, decorated with AMG badges, so as to let the next guy driving the E350 know that this car will get the kids to soccer practice and back before the cake is done baking.

The E63 is but one of the many horsepower-packed cars offered today. Many car companies have moved towards offering bigger engines throughout their model line. The numbers are staggering. Mercedes, for instance, offers a 604hp engine in their S65 AMG, coupled with a frightening 738 lb-ft. Honda even offers a 271hp 3.5-liter V6 in the Accord sedan. These numbers are far and above those of the new cars being produced just ten years ago. It is truly shocking that a S65 will do 0 to 60mph in less time than, say, a Ferrari 360 Modena, which was first produced just less than a decade ago.

It seems to me that car companies have missed out on what constitutes “fun” driving with their insistence on offering bigger engines throughout their model line. An enjoyable time behind the wheel has nothing to do with how quickly you can reach 60mph, or how effortlessly your car can leap from 55mph to triple digits. In fact, having fun while driving is not something a car company can even build into their models, which seems to be their aim in many instances, as evidenced by their marketing strategies that emphasize how much fun you will be having behind the wheel of their newest over-powered beast.

There is an old driver’s adage: there is nothing more fun than driving a slow car fast. Borrowing mom’s Chrysler Town and Country and slinging it around an empty parking lot may very well be equally as fun as beating some punk kid in a Subaru WRX at a stoplight while driving your Audi RS6 to the office in the morning.

Most every car enthusiast started off driving a piece of junk when they first got their driver’s license, and we all remember well how much fun it was to drive that car…

A couple pictures to decorate the site...