The Future of the American Auto Industry

[tamias6]

Its plainly obvious that the American car makers are taking a beating from foreign competition. Ford's reliability outside of their pickup truck models is known to be shabby. Daimler dropped Chrysler like a hot potato, because it caused the German car maker a bunch of grief when it came to the bottom line. Lastly, Toyota is at the verge of surpassing GM as the world's largest auto manufacturer while GM keeps sputtering out car models of lack luster design. Then there are hot button issues like the roller coaster relationship between the UAW and Car Manufacturers, rising cost of Health Benefits, what to do about Retirement Packages, outsourcing, and so forth bogging down the American Auto Industry. Meanwhile foreign car makers are producing better made cars and even building plants here in the states. They are gaining more and more of the US market share while hitting the Big 3's last stronghold, the pickup truck and SUV segments, fast and hard. Putting all these factors together pretty much spells doom and gloom for the American Car Makers with no sign of letting up.

That begs one to ask the following questions. 50 years down the road, will there be any American Automakers still in existence. Will one or more go out of business leaving any survivors? Or is it written in the stars that one day, the once mighty Big 3 become nothing more than fading memories?

[suburban george3]

I don't think it's time to 'write off' the American Auto Industry yet. However, it will be a much different business model 50 years from now if it's to survive. More co-operation between 'competitors' will be needed as design, research, and production costs continue to mount. This will be ever so true as we struggle to find alternative sources of fuel for our automobiles.

I do think it's quite possible that 1 of the Big Three will fail. Right now, it's probably even money on Ford or Chrysler. Ford just can't build the product America wants anymore, outside of trucks. Chrysler is emerging from the Diamler 'merger' as damaged goods. Ford 'supposedly' has exciting things in the pipe, but previous 'hot products' have failed to impress at the showroom (think the 500, Focus, and even Mustang as of late.) Chrysler's product line is not as innovative as the mid-90's and sales on most products are lackluster, even though there are still bright spots (the Minivans, 300, Charger, Magnum, new Wrangler, Compass, Caliber, and even the Avenger/Sebring, albeit some of these lines still depend to heavily on fleet sales.) Chrysler's only advantage over the short term is that they will now be privately owned, so a multitude of investors will not be demanding changes at every board meeting.

Toyota will continue to gain, for now. But who knows, Hyundai/Kia are coming on strong and luxury marks (Acura, Lexus, Infiniti, Mercedes, Audi, and BMW) are also doing well. Don't forget that in 50 years we could see new makes in the market from the emerging economies of China and India.

[monsoon]

50 years is a long time for a prediction. Let's keep in mind the automobile is a very inefficient method of transportation that uses a lot of resources, creates huge amounts of pollution, and depends on cheap sources of energy for people to afford it. 70 years ago, most people did not own an automobile and instead used public transportation to get around. It's not unreasonable to think we might not return to something closer than this in the future.

I do think there is going to be more consolidation in the automobile industry. I no longer consider Chrysler one of the big 3 as its dance with the Germans have pretty much sundered that company. It won't be here in 10 years. The big 3 in the USA now and the world for that matter, are GM, Ford and Toyota, followed by a dozen or so smaller companies. This will probably change to a couple of big holding companies that share technology and sell cars under a lot of different brand names. If I had to pick a survivors I would say it would be GM and Toyota.

In regards to Michigan, I think the state would do itself a favor to find something else so it can unhitch itself from the automobile business.

[RustTown]

50 years is quite the extrapolation. For the meantime, I see all three surviving, except with a much reduced market share, that's all. I don't see any of them just going away, but the market is different. They've been in an international market for decades, now, and everyone knows (including the companies) that they can't dominate like they used to.

[RustTown]

So, everyone who's voting that one company won't survive, which one did you choose to die?

[detwaa84]

Chrysler will be piecefully sold off. And just like Metro said, much sooner than 50 years.

[WOT]

I think that Chrysler will see some backlash over their deal with the China. I believe their will be current loyal buyers who won't want to support China manufacturing. Just sayin....

[Rybak 187]

I think that Chrysler will see some backlash over their deal with the China. I believe their will be current loyal buyers who won't want to support China manufacturing. Just sayin....

[RustTown]

I seriously doubt it. The "Buy American" movement is a niche movement, at best, (and has always been to an extent), and it can be easily seen in what type of cars people buy (i.e. less and less American cars). The truth is that most people don't care where their vehicle is made, and that's even true here in Michigan, the home of the American automotive industry. Any backlash will be minute.

[suydam]

I seriously doubt it. The "Buy American" movement is a niche movement, at best, (and has always been to an extent), and it can be easily seen in what type of cars people buy (i.e. less and less American cars). The truth is that most people don't care where their vehicle is made, and that's even true here in Michigan, the home of the American automotive industry. Any backlash will be minute.

[grrwymg]

Agreed. One need look no further than the west side of the state to see that the "Buy American Cars" thing is pretty much dead outside of Metro Detroit (not to say it's right or wrong...just observing that nobody seems to care one bit when you're more than an hour or two from the D).

[Rybak 187]

I have had my Chevy Cobalt for over a year and have not had any problems with it.

[Ka3kab]

After years of buying used cars, I finally was able to afford a "new" car. Sure it was a $19,000 new car, but it was still new and I thought I wouldn't have as many problems as I had in the past. Six years later, my wonderful Oldsmobile has gone through:

7 Pairs of brakes (6 front, 1 rear), $210.00

4 Wheel alignments, $250.00

4 Rotars, $140.00

2 Sets of shocks (all rear), $140.00

1 HVAC control center (inside dash knobs), $80.00

1 HVAC blower control panel, $50.00

1 HVAC blower motor, $50.00

1 Headlight plug (one caught fire), $10.00

1 Rear window defroster, $120.00

1 Window lift Motor, $90.00

and saving the very best for last

1 Brand spanking new engine. Mine blew on the way home from work one night at 69,000 miles because of a failed bearing in the crankshaft, $1,600.00

Luckily for me, I was able to save probebly thousands of dollars on labor seeing as how my brothers and I were able to fix all of the above.

Never, ever again will I buy American.

[jbr12]

Minus the engine, everything you have listed seems like normal maintenance, especially for six years running All the stuff you've listed, INCLUDING the blown engine add up to $40/month in maintenance... doesn't seem excessive to me, especially since you didn't buy it new

My wife bought a ford focus that was 3 years old and in 2 years we've put 40,000 miles on it and haven't had to do any more than an oil change. The car is now 5 years old with 100,000 miles and little stuff is starting to go. I don't see how we can say it wasn't built properly or it's Ford's fault... its a mechanical machine, stuff wears out

[Ka3kab]

I guess I should have stated that I put around 7,000 miles on my car a year.

[Rybak 187]

I put over 12,000 miles on mine so far.

[monsoon]

I guess I should have stated that I put around 7,000 miles on my car a year.

[Ka3kab]

I thought so too. I would love, absolutly love, to be able to support the Big 3 seeing as how so many of my family members work or worked and retired from GM (to the amazement of us, none of my eight relatives were ever laid-off from their respective Flint area plants) but with all of this trouble I just can't seem to want to. It's really not that big of a shame anymore to buy Japanese cars seeing as how they are build here in the US. People in Michigan or the U.S. aren't the only ones that have to eat.

[Rybak 187]

We also Chevy Blazer with over 218,000 miles on it with only regular maintenance. So, its possible you just were unlucky.

[Ka3kab]

There is no doubt there. I have had nothing but terrible luck with cars, even friggin' rental cars break down on me. I just need a jetpack to get around, but of course, that will malfunction as well.

[Rybak 187]

I guess that is a sign that you are supposed to use mass transit.

[Ka3kab]

No such thing in Traverse City. BTW, you can't say BATA because they are very sporadic in their service and they don't exactly make runs to Interlochen, where I work.

[DaltonGA]

I think Ford will outsurvive Chrysler, though Mercury is redundant, basically existing to help Lincoln dealerships with volume, basically selling thinly disguised Fords, and could eventually be eliminated along with the other "mid-price" GM brands Pontiac and Buick(though I think Buick has better long-term prospects than Pontiac). Ultimately there will be a FoMoCo producing Lincolns and Fords and possibly Jeeps, from Chrysler and GMC producing Cadillacs, Chevrolets, Saturns and GMC trucks.

It's even possible that Toyota or Honda could end up owning a stake in the remaining Big 2. Keep in mind that Ford has an interest in Mazda and GMC have long held stakes in Suzuki and Isuzu with partnerships with Toyota. Chrysler once held a large chunk of Mitsubishi, selling off its interests completely by the time Daimler took over.

What makes a car American now? Canadian built cars have long been considered domestic and NAFTA included Mexico. Many components are from foreign sources-electronics, steel, transmissions, etc. and only assembled stateside whether an American brand or Japanese. The decline of heavy industry in the United States has long lasting implications which many Americans, including politicians, have not fully realized.

The long term trend since the Depression has been consolidation, brand elimination, and concentration into the current Big 3. Studebaker, Packard, Auburn, Duesenburg, Cord, Stutz-Bearcat,

Nash, Hudson, Willys, Knight, Overland, Kaiser, Frazier, AMC/Rambler and many others merged and folded. GMC has eliminated Viking, LaSalle, Oakland and Oldsmobile. Chrysler has eliminated DeSoto, Plymouth, and Imperial(with revival attempts) and a short lived Eagle from the AMC takeover. Ford once produced Edsels and broke Continental out as a make from the Lincoln line.

Oldsmobile and Plymouth are merely the most recent domestic brands to be eliminated.

[Michi]

Ford's quality, safety, and reliability...as well as design are all improving.

My concern for the future would be Chrysler.

[NorthCoast]

Automobiles are so 20th century