Rest in Peace- Demise of GM, Ford and DCX – American Automotive
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The news of General motors (NYSE-GM) stock plunging 31% today (Oct 10th 2009) to trade at $4.80 took many by shock, some by surprise but one person as a long awaited outcome .. Yes that’s me! |
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And that is because I truly believe that the demise of American automotive has not come because of the financial industry Armageddon rather it’s internal and inherent to the manufacturing culture practiced by these out of touch and stubborn organizations for decades. The credit market crunch has surely helped ease their pain by expediting the trip to their ultimate destination… |
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I remember from my days of working in the automotive industry between years 00-05, in my countless visit to GM, Ford and Chrysler factories spread through the continent again and again I would see the demise of basic manufacturing quality culture; a focus on produce produce produce and no regard and attention for reducing waste and variation and thus giving customers products that have highest reliability and superior quality to meet their expectations. Japanese understand this and that’s why they are eating the lunch and dinner of GM, Ford and Chrysler. I remember one of my superior’s Darrel W, the operations director at a Tier 1 Supplier Company I worked for, supplying parts to the (then) Big-3 and the Japanese car-makers once in a meeting made the comment with passion. Friends! Said Darrel, “I wouldn’t be surprised if in some years Ford Co has a logo of Toyota outside their headquarters”. This was year 2004. Darrel, I am sure we are getting close to that. Ford after years of touting zero defects as a philosophy (and not understanding and implementing it) is going to make up for it by a near zero stock price ($2 today). |
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I for one has predicted and argued to my peers and friends for this writing has been on the wall and any one who can, should get out of American automotive (read Michigan as well) as soon as possible.. Just as I did back in 2005.. LET ME REITERATE AGAIN …The fun and party is over here.. If some one is so much in love with the industry and the automotive life.. They should go work in China or India where the next upbeat revolution is happening in manufacturing. |
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I think this all happening as a result of America’s economy coming down day by day (news from different sources), and rise in china’s industry due to low labor and automotive parts cost. I am sure but this is only my opinion just to take part in this discussion.
But isn’t there any European countries taking part in this race?
Zia, you may say that. But the current situation being faced by the US automotive sector is partially due to their and their countrymen and women’s myopic view of the world affairs. As mentioned by the author that their inability to change according to the times ultimately shrank, or infact, destroyed their monopoly in their biggest market – their home ground, the US. Hence, all this coupled with the current meltdown brought the once-biggest US industry to its knees.
People are worried about the Automotive Industry- I’m sad – Linen’n'Things is going bankrupt! Where do we go for shopping for our home things now – Booo hooo!
UAE would be next good place.
Zia as I said this is much more then just the economy. Big three had it coming for them over the years