Saturday, November 22, 2008

BAILOUT?

 



The CEO’s of the “Big Three” American automakers (GM, Ford, Chrysler) were recently shown on TV begging Congress for money.  “Conventional Wisdom” blames the labor unions for the fiscal mess in which the automakers find themselves.  To paraphrase Henry Higgins, “Why can’t they (the workers) be more like Jesus (or Ghandi)?” and demonstrate some altruism not found among any other well-employed workers in the American (or world) economy.  What is wrong with those greedy workers that they won’t refuse being handed some big bucks to turn a few wrenches on the assembly lines?


We may as well ask why professional athletes, doctors, entertainers, famous artists, politicians or corporate CEO’s don’t turn down the big bucks!  How is it that the wage-earners are constantly under the hammer for not turning away larger wages and benefits, but the others get a pass?  What tripe!


To be sure, the “Big Three” are strapped for cash, and paying out those wages and benefits (especially healthcare for retirees) is quite expensive.  If they go under, their employees will well likely do without.  But I thought it was especially funny that some committee members asked the CEO’s which of them flew commercial to come testify before Congress.  All three came to Washington in their corporate jets.  It is a bit unseemly to be begging for taxpayer dollars in your $700 tailored suits, having just deplaned off your corporate jet.


The fact is that none of the “Big Three” should get bailed out with taxpayer dollars because they are probably going to fail anyway.  We are witnessing the predictable and inevitable result of very stupid corporate management theory that has been in place (at least at GM) since at least the late 1960’s.  I know something about the auto industry, though admittedly I have never worked in it.  I have been a “car nut” most of my life, since I was about 8 years old, some 54 years now.  I am a certified car mechanic, having graduated summa cum laude from the local community college’s auto mechanics program, and I have passed all eight of the ASE (Automotive Service Excellence) Master Mechanic’s exams, though I do not qualify for that since I have not apprenticed “in the trade” for the requisite year.  I have driven, bought and sold a lot of different car brands and types, and I currently own six vehicles of varied type, including four older ones.  I have followed the fortunes of GM especially closely, but I have most recently been the victim of the bean-counter mentality that dominates all domestic manufacturers by virtue of owning a Ford truck.  More about that later.


I have also been a general-practice lawyer for over 35 years.


Once upon a time, GM promoted a bean-counter finance person to the chairmanship, and a (tech background) “car guy” to the presidency.  GM used to build some great cars that way.  In the mid-1960’s, however, GM stopped that practice for the most part and started promoting bean-counters to the corporate presidency as well, using the presidency as a stepping-stone to the chairmanship, as in most other companies.  This was a serious tactical blunder.  “Car guys” could no longer count on being promoted past divisional manager/vice-president.  Control at GM (and the others) was becoming the exclusive province of the bean-counters.  Building good vehicles took a back seat to the Bottom Line on the balance sheet and to the philosophy of tricking the customers into thinking they were still getting good cars with clever “marketing.”


The quality of American cars started to suffer as the Bottom Line trumped all, and “voodoo marketing” was more important than the product being marketed.  Management of the Big Three began to consider the remedy for their then-occasional ills as clipping more costs and ratcheting up the marketing fluff.  The labor unions began to be blamed for those problems and, ultimately, the labor unions have been forced to make serious concessions to preserve their preferred positions.


I won’t argue here that workers have always been well-represented by their unions, but the unions and the workers have been getting more and more of the blame.  Even today, when ordinary people contemplate why the Big Three are in such financial trouble, it is usually overpaid, cosseted assembly-line workers who are deemed to be at fault.  The American public is so brainwashed by the constant drum of anti-union propaganda, at least ever since Richard Nixon’s presidency, that few who are not so employed are willing to consider that unions and hourly wage earners have no role whatsoever in deciding what products to design or manufacture, that the work product of the Big Three is no longer desirable and no longer selling very well.


Rick Wagoner, CEO of GM, testified before the congressional committee that the Chevrolet Malibu was a fine car.  It may well be, but it is but one product out of 35 or 40 that otherwise really SUCK for the most part!  Reading Consumer Reports every month as I do, I have decided that I wouldn’t buy a modern GM product, even though I own a 1941 Buick, a 1964 Olds, and a 1966 GTO.  I love the Toyotas I have owned, and I even liked my Nissan products though, in my opinion, the Toyota products are better.  Either are better than the tripe that the Big Three produce.  I have always wanted to like GM products, so it makes me sad that the current crop of vehicles is so undesirable.  A taxpayer bailout is not going to begin to change the culture at the Big Three.  In my opinion, it is not about safety nor environmental benefit nor fuel efficiency either.  It is almost indefinable what is wrong, but I think it is because the bean-counters are making the ultimate manufacturing decisions instead of car guys.


My special loathing, however, is for Ford Motor Company.  They refused to honor the warranty on my Diesel truck.  I had to pay to replace the entire accelerator-pedal assembly because one of the electronic sensors thereon was bad.  It was clearly covered under warranty, but Ford refused to honor it.  That accelerator-pedal assembly now costs over $500.  I priced it when I noticed that my truck was surging as I drove down the road.  The pedal assembly has two electronic sensors on it, an idling sensor and an acceleration sensor, both made in China most likely.  In their typical, bean-counter arrogance, Ford wouldn’t sell me just the relatively cheap sensor I needed.  They insisted that I purchase the entire pedal assembly with the two sensors on it.


I checked the acceleration sensor with an oscilloscope, and I noted that it was manifesting a “dropout,” a dead spot in the sensor that was probably causing the surging.  I concluded that sensor was about to fail again, so I had to do something.  I tried to order just a sensor from Ford; no deal.  They insisted on selling me the $500+ pedal assembly.  I tried to order a sensor as listed from NAPA, but it turned out to be a throttle position sensor for a gasoline-powered vehicle.  Same function, but different style and shape.


I went online and Googled “Diesel accelerator sensor” and got a hit at RockAuto.com, so I ordered a virtually identical sensor for $45 from them and replaced it in about 20 seconds!  After a few “wiggles” here and there, the $45 sensor has been working just fine ever since.


Why would not Ford sell me just the sensor?  Why would the bean-counters insist on making me purchase the unneeded pedal assembly?  There was nothing wrong with the pedal assembly—why make me buy another?  I daresay it is because the bean-counters are now in charge, and they think it is “cute” or something to make us dumb-ass customers pay for stuff we don’t need if we wind up giving Ford more money.  A “car guy” might have spared me that annoyance.  A car guy might have wanted me to fix the thing as quickly and as simply as possible.  Had Ford been willing to treat me with respect and tried to help me address my problem simply, I would most likely be willing to purchase another Ford product.  But, guess what?  I will NEVER buy another Ford product as long as I live, and I will do my best to cost them as much money as I possibly can hereafter.  I will screw them to the wall if I can.  I despise Ford Motor Company, and I intend to burn them now as much as possible.  I do whatever I can to dissuade others from buying Ford products also, and I have a rather large auto-advice following.  So much for brand loyalty.  Sadly, that is not the fault of the assembly-line workers or their unions, but they'll surely take the blame.


Finally, there is yet another symptom to consider.  Most European and Asian vehicle manufacturers provide very detailed owner’s manuals with their vehicles that do not presume the customer to be an idiot.  They presume instead that the customer might be intelligent enough to really want to know how the vehicle works and maybe do some of the routine maintenance on it.  Contrast them with the manuals provided with most American vehicles: said manuals are very superficial and seem to assume that the customer is some sort of knuckle-dragger who does not have sense to come in out of the rain.  American owner’s manuals are almost worthless crap.  Big Three management (and, unfortunately, some dealers, too) are condescending and treat the customer poorly.  THAT corrosive attitude problem is not going to be fixed by a taxpayer bailout, either.


The real idiots are the bean-counters running the Big Three and the politicians who listen to what they say.  Instead, they should say “no” to idiocy.  If the Big Three are ever going to amount to anything again, we need to put the bean-counters in their rightful place, which is to say, we should stash them in a back room in the finance section somewhere!


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