Detroit?

[Shortround6]

Rumor I've heard is that some US auto executives will tell you, in private, after a few single malts, that the CAFE standards saved them: their corporate culture was so attached to heavy, high-powered, inefficient vehicles that they would have kept going down the path to oblivion.

Some of us can remember the US "economy" cars of the early 60s. given the choice of options Detroit seemed to say "You want a small car? you must want rubber floor mats, cardboard door liners, cheap upholstery and really bad performance from a 3-3/1/2 liter six with a carburetor that could use a quarter as a choke plate." If you wanted a better quality interior you had to buy a bigger car.
I remember shopping for a new car in 1972, Ford Pinto started at just about 2,000 dollars. hub caps were extra, bumper guards were extra, rugs were extra, passenger side mirror was extra , radio was extra, and so it went. You could add hundreds of dollars to the car just to get it up to a decent standard. Went to Toyota dealer, Got a Corolla SR-5 ( first year) for 2500 dollars. Hundreds less than equivalent Pinto.

one reason Japanese cars were cheaper than American cars was labor, the labor of assembling and keeping track of all the options. Back in 1970 somebody estimated that GM could build 1 million cars, no two the same if the option sheets were filled out right. The Japanese just standardized the cars a lot more. Just a few option packages and a few colors, Much simpler to build and much, much simpler to inventory.
Also in 1970 American Motors standardized air conditioning on their largest car (the Ambassador ) and dropped the price 100 dollars. It cut the number of possible combinations of options in 1/2, it also meant EVERY car on that production line got air conditioning with a simplification in dash construction, ducts, engine brackets, pully's and belts.

American pricing was such that the dealer had different profit margins on the options than he did the basic car and could make more profit on the options alone than on the basic car.

 

[evangilder]

I remember that craziness. The list of options was humungous and you could really increase the pricing with it. Hard to imagine now having to pay extra for the passenger side mirror, and seeing lots of cars with mismatch side mirrors because after market ones were way cheaper. That is part of the demise of the city, coupled with some horrible mismanagement.

I remember when Lockheed left Burbank, CA. For a while, the city kind of stagnated, then with proper management and incentives for the studios, Burbank is back to thriving. Granted, it's not like the heydays, but it is still better off than a lot of the surrounding communities that have really gone to hell. Some of the neighborhoods I remember being kind of shady are nice now. Detroit's demise is not completely the auto maker's faults.

 

[Lucky13]

Come to think of it, like Lockheed and Burbank....
Where I used to live in Sweden, where my parents still, Östersund..
We used to have an air force base, fighter wing, an artillery and one infantry regiment, military schools the lot, now it's all gone.
Well, we were all worried what was going to happen. As it is, the army and air force barracks are not allowed to be pulled down, as they're listed.
Nowadays they're offices, schools etc., etc....
So far, I think that we're, they're doing good...

Hope for the best for Detroit, she deserves it...

 

[evangilder]

To be honest, Jan, I think Detroit is in serious trouble and may not recover, or it will take many years to. Some of the most incredible homes that once graced the higher class neighborhoods have been burned down or bulldozed as have some of the cities landmarks. It should serve as a warning to other cities that are being mismanaged. Unfortunately, few are paying attention. It'll happen again, it's only a matter of time.

 

[Shortround6]

A major problem with American politics and thus government planning is that most planning/budgeting is either one year or to the next election, so short term savings (lower taxes this year) are often bought with higher long term costs.

That and every politician (or would be politician) who can come up the price of a batch of bumper stickers claims HE/SHE knows how to provide more services for less money before the election.

 

[vikingBerserker]

A major problem with American politics and thus government planning is that most planning/budgeting is either one year or to the next election, so short term savings (lower taxes this year) are often bought with higher long term costs.

That and every politician (or would be politician) who can come up the price of a batch of bumper stickers claims HE/SHE knows how to provide more services for less money before the election.

A FRICKEN-MEN!!!!!!!!!!!!

 

[Lucky13]

Some areas must be like ghost towns....?

 

[syscom3]

Pittsburg successfully navigated the downsizing of the steel industry. And so must Detroit embrace the fact that auto manufacturing is not coming back. The city must downsize. And the state of Michigan (and other rust belt states) must change their antiquated labor codes to reflect the here and now of the economy, and not of a century ago.

 

[razor1uk]

Stagnation, ignorance delusions of grandeur = demise + crime lowering population = things need to change with conviction, transparency and hopes for the future that do not rely on false promises and egomaniacs.
Good luck Detroit and remember, its not quite "..you have 20 seconds to comply!" just yet.

 

[Shortround6]

You also have to balance what people expect from city services today and what they cost to what was expected 40-50 years ago.
You can have cheap city services as long as your expectations are low. 40-50 years ago city Ambulances just threw the patient on a stretcher (with minimal bandaging if they were bleeding) and drove like He** for the hospital. No drugs for stroke or heart attack victims in the field. Little or no spinal immobilization for accident victims, no IVs to keep fluids (blood pressure) up.
Firefighters often had no breathing apparatus so fires were fought from the outside= more foundations saved.
If a city was shut down by snow for a day or two, well, it was winter.
Now everybody wants first rate MODERN medical care, first rate fire fighting ( and accident response, Hurst tools and the like), Next to no delay in snow removal and so on. It all costs money. And the people who provide those services would like to make a living wage, like be able to live in/close to the city they work? Not qualify for free school lunches for their kids if the wife is not working, Not have to suit up and climb 3 steps onto a fire truck at age 65 because the pension su**s (lets face it, do YOU really want a pair of 65 year old firemen trying to drag YOU or a loved one OUT of a burning building?)

And not funding pension programs for years and then claiming cities can't afford pensions they signed onto years earlier ( saved tax dollars for those years they didn't put money in the pension fund didn't they) doesn't sit well.

 

[Lucky13]

Rust Belt??

 

[Matt308]

Geographical iron industry locations in US.

And shortround... local garbage workers recently went on strike here. On average they make over $90k/year. That's a damn good living for driving a recycle/garbage truck. Job qualifications? Over 18, highschool diploma or equivalent, pass a urine analysis and no driving under the influence violations. And these gents never have to lift a finger. It's all automated. Pretty damn cushy if you ask me.

 

[B-17engineer]

Thats the problem, there's no such thing as the "American Dream" anymore everyone believes they're all entitled to things instead of working for them.

 

[Shortround6]

Geographical iron industry locations in US.

And shortround... local garbage workers recently went on strike here. On average they make over $90k/year. That's a damn good living for driving a recycle/garbage truck. Job qualifications? Over 18, highschool diploma or equivalent, pass a urine analysis and no driving under the influence violations. And these gents never have to lift a finger. It's all automated. Pretty damn cushy if you ask me.

Sounds good to me, I retired after 33 years at under $72K/year pay, not pension. That included all over time and bonuses. We had a guy back in the 90s with 2 kids and wife not working, if he quit his part time job he would have qualified for free school lunches. for the kids. Sometimes unions are a problem and sometimes they are not. Like to guess what the town wanted us to work for

Thing is somebody on the town side has to agree or for Fire/police it goes to binding arbitration ( no strikes/no lockouts).

 

[Njaco]

You guys are making me sick. We have to keep the politics down but Detroit's problem as is with all the rest of America is nobody votes anymore. I believe that the highest percentage of those able to vote in an election and actually do is around 30%. Its these career politicians who greedily destroy things - and that comment is meant to be bi-partisan.

 

[syscom3]

Rust Belt??

That's a term used to describe the old industrial and manufacturing cities of the midwest and northeast states. Principally Michigan, Illinois, Indiana, Ohio, Pennsylvania, New York and Massachusetts.

Many of the factories started closing up in the 70's and 80's as globalization caught up with them exposing quality, cost and efficiency deficiencies. And some of them simply closed up because of changing technologies and consumer tastes.

As it pertains to auto manufacturing; its several fold in complexity. You had the American manufacturers making horrible quality cars that drove (no pun intended) customers to foreign makes. Then you have a unionized workforce with their collective heads stuck in an era when there was no competition, and the resultant labor immobility and inefficiencies. And then factor in on how poorly the management was, for 50 years or more.

Now whats screwed for Detroit, is when a new assembly plant is built, it isnt in that city at all. The jobs when created now, are elsewhere. And that goes for the state of Michigan and the other "rust belt" states.

Rust Belt or not. Factories all have limited lifespans. You have to invest in them from time to time to bring them to modern technological standards and keep them efficient. Or they will slowly "rust" over time and eventually become obsolescent, then obsolete and be shut down.

 

[davparlr]

Some of us can remember the US "economy" cars of the early 60s. given the choice of options Detroit seemed to say "You want a small car? you must want rubber floor mats, cardboard door liners, cheap upholstery and really bad performance from a 3-3/1/2 liter six with a carburetor that could use a quarter as a choke plate." If you wanted a better quality interior you had to buy a bigger car.

I don't agree with you fully here. In 1960 the US auto industry delivered three solid compact cars, the Corvair, the Falcon, and the Valiant. These were very basic automobiles with limited niceties, but so were the foreign cars at the time such as the technologically simple VW (it had no gas gage). The Valiant was probably one the best cars ever built (if you can get by the ugliness of the Exner designed first three years). Combine the slant six, especially the 225 CI one, with the torqueflite, you have a peppy little car with recognized durability. I owned an upgraded compact, a 1963 Oldsmobile F-85 Station Wagon which had equal plushness of the 63 Olds 88 we had owned. It had 185 hp 215 CI aluminum V8, which later became the Rover 3.5 liter V8, and hydramatic transmission. It was a nice car. I bought my son a 1965 Corvair and with its Corvette-like independent rear suspension, it tracked like it was on rails with little body lean. If you want a cheap fun car, get a 65+ corvair with the 140 hp engine and four speed. In 1964, with the advent of the Mustang and GTO, American car industry entered its exciting phase that I was a privileged to participate in. In my opinion, the American automobile reached its peak in style and performance in the later part of the 60s. In the early seventies it started to collapse.

I remember shopping for a new car in 1972, Ford Pinto started at just about 2,000 dollars. hub caps were extra, bumper guards were extra, rugs were extra, passenger side mirror was extra , radio was extra, and so it went. You could add hundreds of dollars to the car just to get it up to a decent standard. Went to Toyota dealer, Got a Corolla SR-5 ( first year) for 2500 dollars. Hundreds less than equivalent Pinto.

All of these things are true but it wasn't what killed American auto industry. People were nameplate loyal going into the 70's, but quality collapsed due to poor management and greed. I am sure you would have found that Toyota much more reliable than the Pinto. Due to poor quality, the American automobile lost its owner loyalty which it has never gained back. Had it not done this, the American public would have stuck with Detroit iron. As proof of this, look at the medium truck business. The best selling vehicle in the US is a Ford truck, Chevy and Ram are right behind. Toyota and Nissan trucks in this category, with excellent vehicles, are struggling, barely making a dent in this very profitable line. That is because the American truck manufacturers never lost their owner loyalty, meeting or exceeding their expectations. A Ford truck owner, is a Ford truck buyer, so too for Chevy and Ram. Oldsmobile owners used to be Olds buyers, but no more, in fact there are no more Olds. This happened to me.

In my opinion, the root of the collapse of the American automobile business was greed on the part of Unions and greed, incompetence, and arrogance on the part of management.

Sometimes unions are a problem and sometimes they are not. Like to guess what the town wanted us to work for

Yes. I am a product of unions. My dad was a fireman/engineer on the railroad, throwing coal into the belly of the beast, and before the unions they could work you to death for little or nothing. Unions let them have a life and a living. Unfortunately too many unions have become greedy and some socialistic. Management have always been greedy.

 

[swampyankee]

Actually, if you look at Consumer Reports (which has problems with its statistics -- it frequently rated a car with an American nameplate much worse than the same car, coming off the same production line, as much worse than the mechanically identical "Japanese" variant), Honda, Toyota, and Datsun were consistently worse than American cars until well into the 1970s. (a friend had his Corolla throw a rod....) They improved, largely because their management invested in plant, employee training, and engineering while the US companies invested in ... what did they invest in? Do note that at this time, Japanese labor was not notably cheaper than US labor, Japanese companies pretty universally worked on employment for life, and Japanese workers do not work in slave-like conditions. On the other hand, Japanese companies are not responsible for employee health benefits (I don't know the details of the Japanese system; I believe that it is, overall, similar to the systems in Germany, Switzerland, Taiwan, and the Scandinavian countries, where everybody gets health insurance but hospitals are not government-owned and operated and physicians and surgeons are not government employees).

 

[davparlr]

Into the 1970s American and Japanese automobile manufacturers were heading in different directions. While the Japanese were revolutionizing build quality, American manufacturing, baffled by by emission and safety standards, were driven by bean counters to keep the bottom line up by accepting lower quality standards.

 

[Readie]

Pittsburg successfully navigated the downsizing of the steel industry. And so must Detroit embrace the fact that auto manufacturing is not coming back. The city must downsize. And the state of Michigan (and other rust belt states) must change their antiquated labor codes to reflect the here and now of the economy, and not of a century ago.

What did JFK say?
Ask not what your country can do for you
Ask what you can do for your country

True then and even more so in 2013 in America and here in the UK. The culture of entitlement has run its course....