The Big Three Blame Game
Jan 13, 2009
It was recently announced that provisions of General Motors’ and Chrysler’s $17-billion in federal loans automatically places them in default if union workers go on strike.
This should come as no surprise to anyone as many in Washington and around the globe have long blamed union workers for Detroit’s woes. These critics often blame workers’ “bloated” salaries and pensions as the primary reason the domestic automakers are now in financial ruin.
It’s interesting to note that the workers (at least those who already haven’t lost their jobs) have been among the first to make concessions to allow their companies to regain a firm financial footing. For example, next year, workers at Ford plants will earn an average $53 an hour with benefits, the result of an industry agreement worked out with the UAW in 2007. That’s close to the $49 an hour average that workers at U.S. Honda, Toyota and Nissan plants make and far below the $71 an hour with benefits that was the old UAW wage. It’s a substantial wage cut for workers, but many still blame the “greedy” workers for Detroit’s problems.
Others are quick to blame the “Big Three’s” poor quality and slipping sales for their woes. It’s true, sales for each have slipped, but so have everyone else’s. However, it’s getting more and more difficult to question the quality of North American automobiles.
In fact, according to Consumer Reports’ latest reliability survey “almost all Ford models are now average or better…Ford’s reliability is now on par with good Japanese automakers.”
Yet, negative perceptions of American vehicles remain. For instance, if you ask the average North American which brand they believe makes more reliable cars, GM or Mercedes-Benz? I’m certain most would give the nod to the German brand. But they’d be wrong. In fact, none of Mercedes models “scored above average and a third are still below average” according to Consumer Reports. As for GM, quality car rater J.D. Power recently rated the Cadillac CTS and Chevrolet Malibu as top picks in their respective categories.
So let’s see, it’s getting more difficult to blame the union workers and you can’t just say the American’s make crappy cars anymore, so who’s to blame? Well, the global financial situation definitely didn’t help. The downturn in the market hit the financing arms of each Detroit automaker hard.
But I think consumers, people like you and I, are the real ones to blame – the people who are willing to buy a Kia, Suzuki or Mitsubishi rather than a GM, Ford or Dodge. This is the real reason people working for the “big three” have lost their jobs over the last few months.
Over the years, it’s become much cooler to buy a “foreign” car instead of a “domestic”. You can talk all you want about build quality, reliability, and performance, but when it comes to cars the average person places more stock in the colour, styling and caché of a brand than anything else. Many think “why buy a Cadillac when I could get a BMW?” and their decision is given little more thought than “a BMW says I’ve arrived”.
Call me crazy, but I think it’s our ignorance as consumers and the lack of thought on the effects of our buying decisions that are the real reason behind the “Big Three’s” troubles.
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