sunnsea

Preview from Europe: Too Big to Fail? Not GM

Good post. We are at the moment in the worst of all possible worlds in terms of manufacturing. The US government is backing into ownership of GM because it is "too big to fail." But there is no overall national industrial/manufacturing strategy that would shift resources as you are suggesting and that would promote American made products abroad. Everyone else in the world seems to have this, except maybe Somalia or Zimbabwe. We need both a national strategy and the ability to turn companies into globally competitive, low-cost but high value added producers. Government's role in this is to provide the strategy and the support to the US companies as they confront their similarly supported global competitors, but it should not be involved day to day operations let alone ownership.


On Jun 01 11:21 AM manya05 wrote:

> On the GM debacle (Chronicle of a Death Foretold), I find it interesting
> that over the years we constantly hear the debate go around the table,
> and depending of who you listen to, the fault is with management
> or the workers. Greedy managers that sacrifice the long term for
> the short term and failed to see the trend toward fuel efficiency;
> workers and unions that do not care about quality and will sink the
> company because they get paid too much.
>
> What I always found interesting is the complete absence of blame
> toward the engineers that designed these cars. Has anybody considered
> that maybe GM cars were lousy because their designers were (are)
> lousy? Has anybody stopped to think that maybe this is the result
> of the US universities not churning out enough engineers with the
> ability to design good products? things that can be manufactured
> and that will work as intended? Universities keep following the government
> pied-piper when it comes to research and education. And the government
> has led them down the path of increasingly exotic research (nanotechnology,
> which came after bio-inspired robotics, which came after AI, etc.
> etc.). Along the way, universities stopped producing good practical
> engineers that can design and make things. I think we are also paying
> here for a system of government funding university work that has
> gone awry. Everything is interconnected, nothing is independent,
> we cannot expect to have a strong manufacturing base if universities
> are being subsidized to do things that are 20 years away and in the
> process undersupply the market with the engineering skills needed
> today, not in 20 years.

Preview from Europe: Too Big to Fail? Not GM

I guess we all have our GM/Detroit stories. But at the tender age of 19 back in the mid-60s I was going to school in Detroit. I could tell back then, when the economy was booming and the plants were humming, that the Big 3 did not have the proper global approach. At that time VWs and Volvos were the rage. They were filling a niche that our guys seemed oblivious to. Our guys were building cars for the American Midwest, not cars or trucks for the rest of the world even though the signs of expanding of overseas economies were manifesting themselves. True, GM owned Opel at that time, but there seemed to be little connection between the two other than ownership. Also, visiting plants in Michigan and ones in Europe later in my career, I noted some big differences: too many guys on the shop floor in the US with hands on the products and not enough in the engineering and marketing departments with a global approach. In Europe, it was and is the opposite, high degree of automation and much greater emphasis on global marketing and engineeering. We began to retrain workers but not in engineering, always in things like computer graphics or office applications. Looking around the world at all economies, one thing stands out in my mind: strong emphasis on engineering, exports and creating cachet for the products. You have to admit BMW, Mercedes, Proche, Lexus, Acura, etc. have done this. Go to any Third World country and you see Japanese and Korean brands for vans and small buses. China in the 80s imported lots of Japanese cars to upgrade its taxi fleets as it opened its borders and economy. A hopeful sign and exception to this, on the state highway between Guangzhou and Shenzhen, there's a GMC truck dealership with pickups on the lot and colorful penants flying and I wonder for a moment if I am in China or Ohio.