American automotive industry in decline

Photo by: Henoc Kivuye

 

At the start of the car industry, American-made cars were at the top of the list – the Cadillac of the industry, so to speak.

“[American manufactures] had really desirable cars,” sophomore Brad Eckhart said. “When gas was cheap, people would rather have a really nice body style, and they don’t care about how high gas mileage is.”

Now, cars like Pontiac and Oldsmobile are things of the past because of the growth of the foreign car industry and the collapse of the economy, which greatly effected General Motors (GM), Ford and Chrysler, better known as The Big Three in the car industry.

“American car manufactures didn’t have any competition from overseas,” Jody Jones, business professor and former Ford employee, said. “In the early 1980s, some things happened and we ended up with more Japanese cars. And we hadn’t been used to that competition, so we didn’t do very well.”

GM had an especially hard time with the new competition because of the way their business was run.

“I know nothing about writing newspaper articles, and if I were to take over a newspaper and try to manage the accounting for it without knowing anything about selling newspapers, I would be in trouble,” Jones said. “That’s kind of where GM was.”

Eventually, GM had to file bankruptcy. After this, several opportunities arose to  assist GM in gaining their previous power back.

“GM has cut a lot of their product lines,” Jones said. “There is no more Pontiac; there is no more Oldsmobile. Hummer belongs to a company in China now.”

The federal government also offered money and programs to save The Big Three. The largest mission was the federal bailout.

“That bailout was totally necessary,” Eckhart said. “If that hadn’t have happened, the car companies all would have crashed. The Big Three are so intertwined that if one goes down, they will all go down because they all buy parts from the same suppliers.  If the bailout hadn’t happened, Detroit would have keeled over, and Michigan would have keeled over, and it would have been a horrible, horrible situation: poverty and joblessness.”

Other influences besides the economy also effect American car sales.

“The foreign companies work on making their cars sturdy and well-built, and American manufactures work on making attractive body styles for cars,” Eckhart said. “So as a result, the foreign cars have lasted longer.”

There are several issues the American car companies need to work on in order to climb above the foreign companies.

“[American cars] already have bad stereotypes, and that is hard to change,” Eckhart said. “But they need to build more structurally sound cars.”

There are many different ways for American car manufacturers to lead the market.

“I think innovation is at the heart of the American spirit of capitalist growth,” sophomore Evan Loomis said. “We need to be as innovative as our foreign competitors.

According to Jones, cars are like the newest smart phone on the market: whatever new feature or app is the most attractive is the greatest, but as soon as a better, shinier phone appears, the old one is obsolete.

“Whoever comes up with something completely new is going to be a game changer,” Jones said.

Figuring out the newest way to raise fuel efficiency is one way to change the game.

“I think innovation is the key to success, taking what some people are doing and improving it,” Loomis said.

Students have their own opinions on how they might run a car manufacturing company if given the chance.

“I would have all the production take place in the United States, and I wouldn’t be as worried about the foreign market as the local market,” Eckhart said. “I would make cars that are longer lasting. I would make the payment plans cheaper, and I would allow people to lease cars.”

Despite foreign cars being large in America, there are some places in the United States that American manufactured cars are more popular than their foreign counterparts.

“Drive a foreign car in Michigan, and you’re not going to have a good time,” Michigan local Eckhart said.

Because Detroit, Mich. is such a large part of the American car industry, many citizens, including Eckhart, see it as offensive to drive a foreign car. Eventually, the whole nation might look at driving a foreign car just as Michigan does; however, it will take time, hard work and change.

“The automobile industry was birthed in America, and to stay on top, we need to bring our A-game,” Loomis said.

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