So we are going to bail out the 3 big American automakers… eh. Maybe I have been in the marketing business too long but the big 3 are in my view the worst marketers extant. As a part time professor of marketing I have had the opportunity to study many companies but these 3 corporate welfare bums are a sorry lot.
Lemon-Aid new and used car/truck guides by Phil Edmonston are unlike any other auto books on the market. Their main objective is to inform and protect consumers in an industry known for its dishonesty and exaggerated claims Every year for close to 20 years you can read about the horror stories of the big 3 . Yes there are stories about the European and Asian cars but the vast majority of the horrors are about the clunkers from Detroit. (I do like their basketball and hockey teams and there were times I liked their baseball teams ( love Motown music) but their cars resemble their poor excuse of a football team … the worst of the worst.)
For close to 30 years Consumer Reports have reporting that the Americans who are great at many things can’t seem to produce a descent car. The Japanese and even the Koreans and yes the Europeans have made the American’s look like amateurs. Are the Chinese next.
Why can’t one of the greatest countries in the world produce a decent car. Why do they continue to produce gas guzzlers ( OK Ford has tried to produce a few fuel efficient vehicles). Why have the Japanese figured out that it is important to produce hybrids and other fuel efficient vehicles but the duds at the big 3 produce SUV’s, Vans and Trucks. Did they really think cheap oil was going to last forever (yes gas prices are down now but just wait they will be back up soon)
Denis Desrosiers expert on the car industry states that
“the Detroit three’s problems are not because they are lousy companies, produce shoddy product or the wrong product for the market, have dumb executives or a failed business model. That may have been the case many years ago but these companies have been aggressively addressing these issues for quite a long time with some success. The seriousness of this cyclical downturn cut this restructuring off at its knees. Yes, they continue to lose market share but this is more because there are now eight very capable vehicle company groups in North America instead of three. No matter how good a company you are, if you have eight near equal competitors in the market instead of three, then the original three lose a lot of market share. That is simple math. The Detroit three have made a lot of mistakes but these mistakes simply got them to a lower market faster. They were destined to lose much of their market even if they had made no mistakes.”
Yes Denis they would have lost market share with all these new companies coming into the market but surely these guys are not great business minds,.
For example a few years the geniuses at Queens park … our brilliant provincial government subsidized GM to open a new plant in Ontario. So what did the brilliant ones from GM come up with … a new electric car… no! or maybe a new hybrid model… no! or how about a new fuel efficient vehicle … no! These brilliant marketing minds came up with … are you ready for it … the “muscle car” of the 70’s THE CAMARO. Yes the Camaro . I am not making this up. This is what the taxpayer paid for ladies and gentlemen. Who in their right mind would think that the Camaro would make a come back. Only someone who is smoking crack.
Also one of the things you keep hearing from the big 3 and their apologists is the reason that they keep producing their Hummers is that what Americans and too a lesser degree Canadians want . NO that’s not necessarily so. What the big 3 has been doing for the past 20 years is putting most of their marketing efforts on suvs, trucks and vans and convincing the masses that’s what they need. Then they tell us “well we are only selling products that consumers demand.” Give me a break… Pleasssssse.
Our Centre in conjunction with Pollution Probe and the University of Regina are working on a major study of why consumers buy the vehicles they do and what are the barriers to buying fuel efficient vehicles. The studies will be completed in March /April 2009 and we will have much more to say about this topic.
Many years ago I remember reading a book by a UBC professor about screw ups in the private sector. The author was trying to make the point that it wasn’t only governments who make blunders but when the public sector does make blunders the world knows about it for years and years while the private sector keeps most of their blunders secret. He went on to describe many blunders but his favourite “whipping boys were the American car companies . I believe he referred to them as ” the gang who could not shoot straight”.
So the big question of the times is should government bail out these losers who have to go down in recent history as the worst marketers . (They aren’t too strong on PR . Imagining flying down in their corporate jets to Washington to ask the government for money. Have they ever heard of the term optics???).
I suspect government has to provide some assistance, providing the big 3 develop a strategic business plan that makes sense. So far their business plans has been abysmal. They clearly need to change strategies and listen to their customers instead of talking down to them and more important “get with the green program” It’s time folks its time. GM, Ford, Chrysler get your act together. If you don’t know what to do spend some time in Tokyo or Seoul.
I am delighted to announce that we just opened up offices in Regina and Calgary. Watch our site for the announcement