realtaxpayer

What GM Can Learn from Toyota

If GM started apologizing for the err of their ways, when would they stop? How do you apologize for 30-40 years of arrogance and mismanagement? GM lost their way so long ago, when they stopped innovating and began just trying to build cheap and sell the most vehicles at the highest margin. Sure that is capitalism at its finest, but if you you are not going to be good stewards of the customer, and lead innovation in the industry, it stands to reason that long term you will stand a chance to lose your customer base to someone who values them more highly.
While initial quality of GM vehicles has improved over the last few years, quality and more importantly "value", which Toyota offers, in retained value of the product over its life has not improved. Ever trade-in a 5 year old GM product versus a 5 year-old Toyota product and compared the percent of retained value from its original purchase price? How about cost of ownership over the 5 years?
GM is finally at least making the move to more visually attractive vehicles where they ruled in the 50's and lost the edge along the way. The late 70's and up until the last 3 years, they have made some ugly ducklings in mass quantities, while Toyota and Lexus actually improved and now are very much in tune with styling trends, perhaps one can say have styles other seek to emulate.
I've purchased several new GM vehicles over the years and everyone has had major component failures that required warranty adjustments. Each clearly a quality issue. When the last one a 4WD GMC Yukon suffered ruined transfer case bearings in the first 4000 miles (yes 4000) due to insufficient lubrication in the transfer case even after vehicle make ready at the delivery dealership failed to discover it and then I was denied repairs under warranty-I bought my last GM product. Still I cheer for them as they have brought our some newer vehicles that appear exciting. Certainly the Covettes have really led the way an are the best example of GM setting a standard others have to respect. The Cobalt is more attractive certainly in coupe versions but far from a Toyota Corolla in finish and driving feel-or even Hyundai. Much closer to a KIA. Then the new Impala which is exciting visually, while not a bad start, it once again is miserable in comparison to a Camry or Accord. Closer sure-on initial impression but check back after 30K miles-I had one as a rental recently and it was not holding up well. I've had 60K mile Camry rentals that were far better.
The bottomline for GM is if you aren't or can't build attractive cars that have a quality owner experience, that you will stand behind with your warranty and that provide real ownership value, you will lose this battle and believing you will retain market share is dilusional. Once you do these things well, then perhaps you can make enough money to actually invest in R&D and innovate new products. The comeback story for this company will have to be amazing or it will be dust in another 10-20 years. The unfortunate reality is that so many jobs from manufacturing, to dealerships, to suppliers, rely on this behemoth, that the impact on our country right now would be devastating. I sure hope GM stops fooling themselves long enough to really figure this out and get it right. If they do, it will be good for America, if not it may truly be disasterous.

The Ten Most Egregious Assumptions of 2008

I enjoyed the humor in this article of a truly epic disaster in the US and world economy. Hopefully Hollywood can do it just as they should have material for the next 20 years to show the fiendish underbelly of this most greedy and dispicable piece of humanity-our trusted financial system. Certainly it is run by people some frightfully smart people who none the less are just human beings who were perverted by greed to have more and be more ostentacious than any of their counterparts in competing firms. Conspicuous consumption of needless material goods all at the expense of the last person standing-the american taxpayer.
I don't want to hear some whine that these smart people did not know what they were doing-they in fact knew exactly what they were doing. I worked at a bank and saw them in action, scheming to to move hundreds of millions in mortgages out of their portfolios so they could write some more since that was easy cash a few years ago which pumped up their resutls and bonuses. This was a very well marketed play, sa game if you so want to name it, that the financial "experts" played to create value to their organizations, move the paper through them and leave it sitting in someone else's lap when the music ceased to play. It was a high tech bank robbery, white collar crime at it finest. It doesn't really matter, we don;t "punish" guys who made millions or tens of millions by perverting the system for thier own gain. Who decided we should market and make "subprime" loans to the tune of hundreds of millions a day? Subprime is such an inocuous term-it can;t be all that "toxic" can it? How about mortgage backed securities? That sounds pretty respectable too-but these we just the clever marketing terms used to hide the evil facts from the public and other casual observers. Mortgage backed securities provided the means to hide a multitude of those now "toxic" loans in with a few good ones. Let's see we'll give it a clever name and call it "managing portfolio risk" that will sound so respectable no one will object to it. Reality is a cruel teacher sometimes-just ask those who invested with Bernie Madoff. We need to not act like this is just another chapter in American history, we need to get mad and get our legislators either finding and fixing this problem or get them out of office. If our Securities and Exchange Commission is corrupt or so inept or naive, then it must be fixed. I am not sure any politician that has been through Washington in the last 20 years or any executive of a financial instution in the last 10 years is completely trustworthy and above involvement in this "crime". If you assisted the financial firms or drove the get-away car in this bank robbery, or turned your head rather than speaking up - you are guilty. This is not the "promise" or shining light that America wants to project to the world-it is not the America I want to leave to my children and grandchildren. Every American needs to stand up and be counted and demand accountability for actions from our public servants and our "trusted" financial institutions. if we don't change the players leading these organizations aren't we further rewarding them when we write them checks to bail them out. Has AIG really changed anything other than where they derive their revenue stream? Let's not sit by and laugh this off as another bad day or allow another arrogant MBA to think they have cornered the market on "smarts". I hope everyone that looks at their reume for the next 30 years makes note that they presided over the bigget melt-down in the history of the world.