Paul Killinger

Will Chrysler Crash?

Very well stated and written. Thank you.

Most insightful comments, as well.

As for myself, I used to believe that Daimler was the dumbest car company in the world for buying Chrysler in the first place. Now it turns out that mantle belongs to some so-called savvy American investors instead. D-B got out light in retrospect, which proves the "greater fool theory," if nothing else.

But "Once upon a time" in Detroit isn't done with us yet. People who don't read history tend to repeat it, as the turbulent history of the automotive industry teaches us all too well.

The sad truth is NO ONE consistently makes money manufacturing motor vehicles. The Japanese only mastered the art as a necessity to rebuild their war torn country after WWII, and they're stuck with it now. But even they have lost money doing it (eg. Nissan) over time, as have the Europeans and other newcomers (eg. the Koreans) more recently.
This leaves the Chinese and Indians as only the next in line.

"Creative destruction" is the most powerful and overlooked strategy in our economic toolbox. It should be allowed to work its way with Detroit, which would ultimately be a blessing for everyone involved. But dying industries never see things that clearly, so we'll throw good money after bad for awhile.

Fortunately, however, even we're not stupid enough to Nationalize (with a big N) the Detroit 3. So they'll disappear eventually, like it or not.