U.S. Auto Manufacturers Are They Ready To Declare Bankruptcy?

By: David Maillie

U.S. auto manufacturers are facing more pressure from import manufacturers every year. They have already been feeling the heat from Nissan, Toyota and Honda, but now with Hyundai taking a larger chunk of the middle and lower range cars, SUV's and trucks this may be the start of the end of the likes of Ford and G.M.

Ford has already announced a restructuring and a projected cut of 30,000+ jobs. G.M. has recently retired an old name brand Oldsmobile and is posting losses on a regular basis. Delphi Corp., the largest auto parts supplier for U.S. manufacturers has already declared bankruptcy which makes buyers leary of future parts availability. Most of the other parts suppliers are very close to or are currently declaring bankruptcy.

In the 80's when Chrysler was having severe finacial woes the government stepped in with million dollar loans and other aid. The government is currently reeling from Katrina, New Orleans, and the war in Iraq. It can't afford to bail out Ford or G.M. The public opinion is against a government bailout as the economy is not its best. George Bush has too many other problems to deal with like high gas prices, natural gas, Iraq, etc...

So, without a government bailout and no proposed new laws to halt the outsourcing and outflowing of jobs and such to overseas giants like China and Japan, it is only a matter of time before Ford and G.M. go bankrupt. Toyota and Honda have been gunning for the number 1 spot and now that they have it are not going to give it up. The only hope left is with the trucks. Both Ford and G.M. have a bustling truck business and it is their only profitable business. The imports have tried to break into this market and after quite a few years they have not had much success. The majority of trucks are bought by die hard Ford or Chevy people. But, that may also change. Toyota has found that the key may be in Nascar. This could and will lead to other imports getting involved and taking the American out of Nascar. That would eventually happen as they have more money and lower costs.

Basically, with the laws the way they are right now, the U.S. auto manufacturers do not stand a chance. So the question is do we restrain trade with countries like China and Japan, possibly hurt foreign relations, Make it more expensive to buy better built and higher quality imports, etc... Or let democracy, free trade, and a capitalist society have its way giving Americans the best, safest vehicles, for the lowest price? Regardless of how we make our laws, Walmarts or their equivalents will always prevail - the basic premise of Walmart's founder Sam Walton was to sell the best products to consumers at the lowest price possible. Look at what he did. In a period of 40 years he went from one store to being the largest retailer in the world. Walmart has plans for 2500 stores in China. Maybe the U.S. auto manufacturers could learn something here. Take the imports on at their own game, stop paying multi-million dollar compensation packages to executives that aren't fixing the company. Maybe they need to pay more attention to what brings the best results in advertising at the least expense. Why is it that some companies must spend millions on advertising and others in the same niche get more results for much less?

Ford and G.M. need to rethink and come out with an attack plan. Go after the imports at their own level. Maybe make a marketing ploy of America and what we may lose. The kids of today aren't growing up dreaming of Shelby Mustangs and Corvettes. They are driving Honda and Toyotas that they fix up like in the Movie The Fast and the Furious. Maybe its too late.

Article Directory: http://www.articletrunk.com

| More

David Maillie is a chemist, an alumni of Cornell University and holds numerous patents including his recently awarded patent for headlight repair, cleaner and restorer. He can be reached at M.D. Wholesale: www.mdwholesale.com

Please Rate this Article


Not yet Rated

Click the XML Icon Above to Receive Manufacturing Articles Articles Via RSS!

Powered by Article Dashboard