Wednesday, January 27, 2010

Auto brilliance can tarnish in a flash

Toyota's recall and production stoppage over stuck accelerators has backed the venerable automaker into a corner of product quality and customer satisfaction issues. As horrible as it is, the immediate crisis will pass.

The incident has brought fond memories of a business cycle game played here in the Motor City that I will call Genius, Idiot and Dunce.

The players in this game are the local auto companies that used to be known as The Big Three: General Motors, Ford and Chrysler. In the 2010 version of this game, Ford is the Genius, GM is the Idiot, and Chrysler is the Dunce.

Ford, it seems, cannot do any wrong. It didn't accept any government bailout money. Its CEO, Alan Mulally, is a bona fide rock star among industry pundits. Products are hitting the mark with consumers.

GM has gone bankrupt. It has accepted federal money to salve a generation of management and economic missteps. But it has a solid product portfolio with more to come in the pipeline, a better labor agreement and a positive future vision.

Chrysler is GM on steroids, except for product. It is now controlled by Italian automaker Fiat that is probably more interested it Chrysler's distribution network in the U.S. rather than company resuscitation.

But history reveals a change of roles is always ahead. Chrysler was the Genius of the 1990s. GM carried the mail in the late 1970s and 1980s while Ford toiled in GM's shadow and Chrysler successfully shook off the shame of an earlier federal bailout.

The lesson: Like the weather around here, wait for the business cycle to change in an instant. Don't ever count anyone down and out in a fickle, dynamic and rapidly changing auto industry.


  1. Very true perspective. Always good to keep the past in mind when gauging the present and future.

  2. Let's hope these companies can each remain afloat independent. I despise a future with nothing but nameless, faceless, multinational mega-holding companies as our providers.