I think the extras are the difference. Good service, extras not costing extra, etc. I personally don't buy foreign vehicles (my wife does) but even I am impressed with the way Hyundai has treated her.
Posts: 880 | Registered: Nov 2005
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1)All of the above, plus making gas-guzzling, poor running vehicles doesn't help. "Loyalty" only goes so far.
2)Join the real world. Try what Scott said.
On a funny side note, the Car Talk guys were joshing a woman for not having more of a relationship with the Toyota dealership techs who gave her car its required maintenance. This meant larger repairs became problematic because now she'd have to build a trusting relationship with the techs.
Only problem is, the relationship wouldn't last long, because after they fixed this 100,000 mile problem, it'd be another 100,000 miles before she had another problem.
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Chrysler won't have to do anything "major". The merger with Diamler has given them a bigger market. In fact, their stock is doing quite well as it has gone up about 10 points since opening this morning.
GM right now is still America's #1 auto maker. However, they are about to be beat in the next few years. Most likely by Toyota. Their stock since opening today has dropped again, by just over a point. (I'm looking at my stocks as I type this. There is about a 15 minute delay in my numbers.) Gm also owns car makers that can be seen at a certain viewpoint as imports. SAAB, Isuzu, Vauxhall Motors, and IBC Vehicles. No, Saturn was never to be considered an import. That was GM's attempt to fight the imports. It failed.
Ford, yes has dropped a good 4 points so far. I don't think they will fare well financially right now. For one, they are making investors very unhappy at the moment (no wonder why). This is still, even though they do produce America's #1 truck.
Imports are hurting the US auto makers a lot, but I don't see them going too soon. Especially since Chrysler is in the process of some really good research at the moment dealing with fuel cells. Out of the three, I see Chrysler coming out on top. Thank gosh the 80's are over.
Right now companies like Nissan are trading for about the same price as GM. Toyota is leaving everyone in the dust at about $102 a share. Fiat is not even worth mentioning, it's so low.
I'm still waiting to see what happens when China really starts to import theirs. BRILLIANCE CHINA AUTO. Decent looking sports cars for a cheap price. Hmmm, not to wonder why the cheaper price, but US citizens do like their sports cars.
Posts: 2208 | Registered: Feb 2004
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Funny story. I used to work for General Motors Roadside Assistance. One day a guy calls about his new Silverado heavy duty. He's had it a week. He's driving down the road and both front shock absorbers fall off.
He wasn't hurt, just extremely unhappy.
Posts: 4569 | Registered: Dec 2003
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Well, the SUV thing only goes for people who BUY SUV's. And alternative fuel vehicles aren't as practical out in the country, with limited options to refuel.
Kell's Hyundai doesn't get any better gas mileage than the Ford Escape here at the office.
Posts: 880 | Registered: Nov 2005
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We discuss this subject very often in the school of business. Of course, most of that focuses more on the fact that foreign auto manufacturers are generally much more efficient in their manufacturing process and much more willing to try out new ideas. This is especially true for Toyota, etc.
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I thought announcing layoffs is supposed to make your stock price go up. Isn't that the whole point?
Posts: 5957 | Registered: Oct 2001
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I will go with the "make better cars" idea. Ford has a very specific set of people they sell to, and you can guess what kind by advertisements. They need to improve their found on road dead vehicles and expand the target market.
Posts: 2207 | Registered: Oct 2003
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Never had a major problem with a Ford. Never. Their trucks are #1 period, especially their heavy trucks. Even if you start having trouble with a Ford, it'll run that way forever. Trees crushing them, losing all oil pressure (my fault), losing all the coolant (again, my fault), they run like champs. Maybe my family just knows which ones to buy....
Posts: 880 | Registered: Nov 2005
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Well, I'm fair certain that Ford Escorts were secretly distributed by another manufacturer. I'm a T-Bird man myself.
Posts: 880 | Registered: Nov 2005
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Oh, yeah. They're also better now. But I had to use the excuse to tell my car bursting into flames story. Posts: 4077 | Registered: Jun 2003
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I had a friend whose care caught fire, while transporting her boyfriend (whom I didn't like) home from the airport... I know it's mean, but I think it's funny all of his possessions went up with the car. He was a jerk.
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Heh. Fortunately, by the time my escort caught on fire, I was no longer driving it regularly (due to its tendency to suddenly stop working in the middle of busy traffic).
Posts: 4077 | Registered: Jun 2003
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I recently bought a new car, and (very briefly and against my general nature) considered a Ford. For two or three years, Consumer Reports has given very high ratings to the Ford Focus, so I thought I'd give it a test drive.
I was completely unimpressed. There were several little things that just irked me about the car, from the sound of the blinkers, to the way it was put together. The salesmen were far too pushy and I just had an overall ewwy feeling about it. Admittedly, the Focus is the bottom of the Ford line, but that's the type of car I always buy. I'm not remotely interested in their mid and full sized cars, sports cars, SUVs or pickups. They may be great. I doubt it, based on my experience, but they could be.
A couple of months later, when I finally got around to buying my new car (I took over a year to finally do it) I went to a different Ford dealership (on Maui... the first one was in Honolulu), once again, just because I was trying to learn all I could about what was available. The salesman started pushing the Ford Fusion on me -it was brand new. There was only ONE on the island, and it had been delivered the day before. It was bigger than I wanted, more expensive than I wanted, with features I didn't want, and a standard transmission, which I specifically didn't want. I was trading in a standard, and wanted an automatic for my daughter to take her driver's test in - The guy kept going on about how it would be the "car of the year", like that was what I was looking for or something. (Oh, and when the car of the year was announced, I noticed that it WASN'T the Ford Fusion, it was the Honda Civic, so if I'd listened to all of his hype and bought the "soon to be car of the year" I'd have been as disappointed as I'm sure he was).
I finally got out of there and bought a Toyota, determined never again to even consider a Ford. I was trading in a Dodge, and owning THAT car has made me certain that I never want another Chrysler vehicle.
I like Toyotas, and I'm convinced if I bought a Toyota 6 years ago when I bought my Dodge, I wouldn't have had to by a new car this year. (I may have wanted one, but it wouldn't have been as urgent.)
Posts: 2069 | Registered: May 2001
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quote:Originally posted by Occasional: I will go with the "make better cars" idea. Ford has a very specific set of people they sell to, and you can guess what kind by advertisements. They need to improve their found on road dead vehicles and expand the target market.
I'm curious about what this set of people is, particularly since my family is apparently part of it. Although we're all slowly moving away from Ford because few of their cars appeal to us anymore. I do, however, have to admit that there are few cars of any make that currently appeal to me.
As to improving their vehicles, I have to think a lot of that is really about improving their image, because in my experience, there is little truth to either the 'found on road dead' or 'fix or repair daily' criticisms.
Posts: 959 | Registered: Jan 2002
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I know my family has been buying the Trucks, Crown Vics, Thunderbirds, and Mustangs since the beginning of time. We bought used for the longest time, because we trusted they still had another 100k miles on them. I think a lot of it's based on a few negative experiences with a particular company.
For example, my grandpa bought Ford, but one time was tempted into buying a GM. He had some problem with the paint coming off in sheets, and never went back. That was probably a one of a kind problem, not indicative of the company, but it didn't matter.
Posts: 880 | Registered: Nov 2005
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I have a Ford Focus maui babe and I love it. I've had mixed reactions on the sounds the blinker makes. It sounds like a bottle cap being popped, but I got used to it after a few weeks. I've had a few problems with it, but nothing major, well, other than the fact that the alternator died and had to be replaced.
Ford and GM will survive. Financially their biggest problem is age. They are old companies with a huge financial burden being placed on them by an aging work force and pensions that need to be paid. It's the same problem the airlines have. Younger fleets do better because they have less costs than the older fleets do.
They need to cut costs, they need new designs, and they need better service and warranty offers. They'll fix most of that in the next five years and be reborn. Toyota and Honda on the other hand are going to see more recalls in the next five years, and that will hurt their image.
Further, Ford and GM both sell Hybrid SUVs, and GM is leading the industry in fuel cell and hydrogen research. Their problems are design flaws I think, and a lot of mismanagement of overseas markets. The new Dodge Challenger looks like a nice return to the muscle car era, just as the newer Mustang is a nice rehash of the old style. They've never had a problem with truck sales.
The area they get beat up in is sedans and smaller cars in general. They need to lower the price of the car, which is hard to do when competing against carmakers that pay their workers significantly less, offer better warranties and quality, and thensome. It'll only get worse when China starts selling it's cars in America for 8K starting price.
It should be noted by the way, that part of the reason why American car companies are having a problem with hybrid sedan sales is that east asian companies control the patents and production of many of the hybrid technology parts. In essence, Ford and GM only get their leftovers, and it costs an arm and a leg. They aren't totally to blame.
Posts: 21898 | Registered: Nov 2004
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I'd believe Consumer Reports (nomethetic data) any day over anecdotal evidence. You can find exceptions to nearly any trend (people do win the lottery), but I'd rather go with the odds.
It is quite clear that as a general trend, as cars age, Toyotas and Hondas are more reliable than Fords. I am not interested in testimonial evidence to the contrary. Anecdotal evidence is simply not more reliable than well-done research that compiles the experiences of thousands of drivers.
Posts: 264 | Registered: Nov 2005
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Lyrhawn: pay their workers significantly less? Last I checked, several of the Japanese auto companies had opened plants in the US and were offering competitive wages.
Posts: 15770 | Registered: Dec 2001
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The new Mustang is the $h!t. And the new Chargers are SHARP.
Edit: Enoch, you trust what you like. I'm going to keep trusting my experience, and buy vehicles I like the design of. Apparently, these fit my driving and maintenance style.
If you mean just the domestically built foreign owned cars, then yes, you're right.
But if you include Hyundai, which is south korean, and whatever the Chinese car company is (in the future I know), what the companies pay their workers in the native country before the cars are shipped over here (they aren't all made here) and the lower amount those companies have to spend on things like medical benefits and pensions, then you get all in all a severely lower cost in financial burden from the workers themselves.
Strictly limiting it to Japanese auto plants IN the United States with a US workforce, you are correct.
Posts: 21898 | Registered: Nov 2004
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I think service is one of the determining factors in one's happiness with a particular car. And while the parent company can guide their dealerships, a lot of the actual effect is going to change with the dealerships. I have a Ford dealership I like because they are responsive and friendly, and another two I can't stand. Kell was drawn to the Hyundai for it's looks , but really loves the service she recieves at the dealership (first name basis, easy to get along with, etc). Me, I'd be frustrated as all get out that they haven't / can't fix the little compass / temp guage in there, but each person is different.
Posts: 880 | Registered: Nov 2005
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Except that the counterexample demonstrates how your argument is dissatisfying. If your argument were satisfactory, then we would not expect those automakers currently competing on price (of which the Japanese automakers are notable examples) to be opening plants in the US. They are, therefore your account misses something important.
Posts: 15770 | Registered: Dec 2001
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I had no hand in purchasing my toyota, as I "inherited" it from my father. However, I have had absolutely nothing to do with any toyota dealership. I love it because it NEVER has any problems of any kind.
We recently bought a Honda Civic because of a) generally very good consumer reports, b) generally very high gas mileage, and c) generally very good reliability (based on both reports and anecdotes). While I liked the dealership well enough (I guess), I like even better the thought that this car is highly unlikely to cause us any trouble for a good long while.
Edit: Hey...look at my nifty post count!
Posts: 4077 | Registered: Jun 2003
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Just for comparison, I'm driving a 1995 Honda Civic. I rolled 187,000 miles this morning. My dad owned it from brand new off the lot with under 100 miles on it until last summer when he gave it to me at 184K. He drove to work daily, roughly 125 miles roundtrip, took it in for all its routine maintenance stuff to the dealership and built a good relationship. When I "inherited" the car, I also inherited Jim. I've only been in to the dealership once, for its 186K oilchange and brakes.
Posts: 4515 | Registered: Jul 2004
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I love America, and from an economic standpoint it would make me very sad to see America's automakers go...
...but from a personal preference standpoint, I would be ecstatic to never see an American made car, ever again, ever. I'd also be overjoyed if foreign automakers began refusing to make trucks and SUVs.
Posts: 4313 | Registered: Sep 2004
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I think a lot of the problem with GM is that they're still stuck in the glory days and have lost touch with what American consumers want. They're too fixated on their brand structures and on trucks, SUVs, and big, powerful cars. They need to come up with some excellent compact and mid-sized cars. Trucks, SUVs, and muscle cars should just be gravy.
An the fact is that nobody cares about the small differences between a Chevy and a Pontiac or a Pontiac and a Buick. Seriously, do they need four different versions of the same mediocre minivan? GM currently has about 23 percent of the market share, and they have about the same number of models as they did back when they had 40 percent of the market. That bloat is killing them.
Posts: 9945 | Registered: Sep 2002
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quote:Originally posted by smitty: Never had a major problem with a Ford. Never. Their trucks are #1 period, especially their heavy trucks. Even if you start having trouble with a Ford, it'll run that way forever. Trees crushing them, losing all oil pressure (my fault), losing all the coolant (again, my fault), they run like champs. Maybe my family just knows which ones to buy....
Ford can be an acronym for one of two things (or both after our horrible Taurus) Found on Roadside Dead and/or Fix or Repair Daily.
Actually, my understanding is that Ford's trucks are really good. It's a shame that their cars stink. If you own a Ford Car, trade it in or sell it as soon as the first repair is needed. Even if all that happened is that your radio knob fell off.
Posts: 1214 | Registered: Aug 2005
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Doesn't include Hyundai, which is gaining marketshare, we're only talking about Toyota and Honda, and how long have then been operating factories in the United States for? Honda for about twenty five years, it's near that for Toyota too. They don't have the same pension debt that GM and Ford have, especially for GM who has literally tens of billions of dollars in underfunded pensions.
That's a huge drain on both American companies that Toyota and Honda don't suffer, and the price of the car suffers as a result. I don't see how you can argue that that doesn't have an effect.
Posts: 21898 | Registered: Nov 2004
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Strangely enough, Japanese companies are known for having overly extravagant pension plans and have been having to cut back of recent years. I wouldn't be surprised if Honda and Toyota have far greater pension funds in Japan than GM and Ford do in the US.
But even if they don't, any properly managed pension fund for past pensions is a sunk cost and irrelevant to the company's general ability to compete today: if they can compete on marginal cost, then they can deal with the pensions.
Its only when they're not competing on current marginal cost that the pensions start mattering, when their finances are in trouble anyways. If they compete on current marginal costs, any temporary cashflow issues from pensions become investment opportunities for outside investors.
Posts: 15770 | Registered: Dec 2001
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I have a 1991 Ford Ranger, with 184,000 miles on it, and until I had a problem with the U-joint's/driveshaft recently it ran perfect, even while pulling loads that were too heavy with it.
$400 later, with a new driveshaft and exaust system, it runs great again. Posts: 15082 | Registered: Jul 2001
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I guess it all comes down to poor management on Ford and GM's part then.
What about Hyundai? And I'm asking honestly, as you apparently know more than I do about the subject, I'm curious.
Posts: 21898 | Registered: Nov 2004
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Glad to see I'm not the only ford backer... it's just the escorts and taurus's that suck, according to anecdotal evidence Posts: 880 | Registered: Nov 2005
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Oh, my knowledge of the automobile industry is minimal; I'm relying on my knowledge of economics.
Personally, I think at least one or two American automakers will survive just fine. How they do so is considerably more up in the air.
Posts: 15770 | Registered: Dec 2001
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I wonder how likely a huge government bail out is. Ford and GM need to scale back, which they are doing, but they need to fix their finances too, before they can try any sort of overhaul that won't scare investors away.
The worst thing that could happen would be for either of them to declare banktrupcy. That'd pretty much be a death knell for whoever does it.
Posts: 21898 | Registered: Nov 2004
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Why? Lots of companies have come back from bankruptcy, lately including Kmart's notable return.
I am completely against any government bailout. If they can create a viable business plan, they'll be able to get private funding. If they can't, bailing them out is just throwing away money.
Posts: 15770 | Registered: Dec 2001
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quote:But even if they don't, any properly managed pension fund for past pensions is a sunk cost and irrelevant to the company's general ability to compete today: if they can compete on marginal cost, then they can deal with the pensions.
Are you including "properly funded" as part of properly managed? Because GM is underfunded by some 30 billion plus.
Posts: 26071 | Registered: Oct 2003
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Its costs must be properly estimated and managed, but the company doesn't necessarily need to be immediately capable of paying them.
Consider a company which, absent its past pensions, is capable of generating positive returns. It is a wonderful investment opportunity if it can accurately represent those pension costs -- private investors can put money in now to offset the pension and expect gradual payback as a percentage of the operating profits of the company.
This happens all the time.
Now, theoretically the costs of a pension could be so phenomenally huge as to make getting out from under it a matter of hundreds of years rather than ten or so, which would daunt investors. I expect this will be unlikely in the case of Ford or GM.
Among other things, there is going to be a major change in health care in the US int he not so distant future, likely to a system removing the burden from companies, and that should reduce pension costs considerably.
Posts: 15770 | Registered: Dec 2001
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What type of health care system would remove the burden from companies? I'll admit that my knowledge of economics is nowhere near as extensive as yours fugu, but it seems like common sense that someone has to pay for health care. If you're talking about government, then it must come from taxes, right? And those taxes will either be on individuals or companies or both I would imagine. So from your statement I don't understand how this will make it cheaper. Could you please elaborate on what you said?
Posts: 1412 | Registered: Oct 2005
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quote:Consider a company which, absent its past pensions, is capable of generating positive returns. It is a wonderful investment opportunity if it can accurately represent those pension costs -- private investors can put money in now to offset the pension and expect gradual payback as a percentage of the operating profits of the company.
So does that mean you're counting ongoing pension expenses as part of marginal cost?
Posts: 26071 | Registered: Oct 2003
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I have a 1994 Buick Skylark. I'm just past 168k miles, and aside from an upcoming seal replacement, the engine seems fine. The car's been reliable enough I could possibly be persuaded to buy another Buick. This is assuming Buick makes a hybrid of more gas efficient model sometime soon, though... Posts: 1813 | Registered: Apr 2001
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I'm a T-Bird man myself.
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I had a friend whose care caught fire, while transporting her boyfriend (whom I didn't like) home from the airport... I know it's mean, but I think it's funny all of his possessions went up with the car. He was a jerk.
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, but really loves the service she recieves at the dealership (first name basis, easy to get along with, etc). Me, I'd be frustrated as all get out that they haven't / can't fix the little compass / temp guage in there, but each person is different.
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