Quote:
Originally Posted by Setec Astronomy
No, it wasn't. I happen to think it's outrageous that a bunch of crooked bankers (etc.) got hundreds of billions in bailout money yet manufacturing got a pittance, but without Gov't help GM would have been bankrupt months ago. These problems are due to the companies having truly gone bankrupt--ethically--long ago, not due to the Gov't. (at least not the short-term actions of the Gov't).
You can spin the whole scenario any way you want to, but if GM had been thinking with the big head instead of the little one maybe they would have already had a car like the Volt, Prius, or Insight. Or if the Gov't had just kept a little upward pressure on the fuel economy standards between 1985 and 2006, maybe the excellent large vehicle hybrid system would have been affordable and in all GM's large vehicles now. How a company that was farsighted enough to purchase EDS and Hughes Electronics in the 80's gets caught flatfooted (again) by oil prices and foreign competition is just a shame.
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They got caught as flatfooted as Toyota. Toyota sunk billions into the full size pickup and SUV market, only to see that market shrink, and their billion dollar truck plant in San Antonio still only run on one shift - half capacity. Then Toyota goes and builds a new plant in Mississippi to build midsize SUV's, the Highlander, only to see that market tank as well. So, halfway through the construction process, Toyota changes their mind, and decides that Mississippi will build Prius's. Then oil prices plummet, and now all the tooling orders are canceled, the quotes for that tooling is out-of-date, and the building sits empty. Then just as the Prius starts FINALLY paying it's own way and making money, Toyota brings out a third generation Prius with even more hi-tech content, Honda brings out a less expensive Insight, forcing Toyota to price match, and voila! Prius is a corporate money pit. Again.
The auto industry is part marketing research, part guessing game, and a big part luck. Timing can be everything, and last years credit market crash precipitated much of the current situation for the whole auto industry, with everyone, including Toyota and Honda, losing billions of dollars. In fact, Toyota's current cash burn is higher than GM's was at their worse month in the last six month. GM built, from 1985 to 2006, closer to what the majority of the market wanted - bigger vehicles and SUV's. A lot of the product had bad timing in coming out, bad quality in some cases, but bottom line, they followed the consumer trends to expensive SUV's and trucks. So did Toyota. So did Mercedes. So did Nissan. So did BMW.
And the reason the government didn't keep CAFE pressure up was that the majority of people objected. Both in their buying habits and in their voting habits. Bottom line.
And I'm with you - I think it's a shame that manufacturing gets treated like the red headed step child.