http://biz.yahoo.com/ap/081108/autos_what_happened.html
“They” say US automakers won’t survive unless the government steps in with a bailout package for auto makers, just like for financial firms. That may be true, short term. But what about long term effectiveness? The above article says the business decisions of the US Big 3 during the flush times led to their demise. Fine – fix the business decisions by taking on the Unions, etc, etc, to reduce costs. But what of consumer preference? Will a bailout will fix that problem? No chance.
The only fix to consumer preference is producing a high quality product that consumers want to buy. The Japanese have studied this point for years and developed the “know how” that now allows them to provide the excellent quality products US consumers have come to recognize. They call it “monozukuri”, or the science (not art) of making things. The US manufactures have generally ignored the fine details of monozukuri and have instead pushed technology down hill and out the door to suppliers. They themselves have largely become coordinators and program managers. The suppliers in turn were allowed to become sloppy (by Japanese standards) because all the OEM’s care about is whether they can produce test results showing their parts meet the OEM specifications (and more importantly to them, whether they are they the lowest cost supplier). The OEM engineers generally have lost the technical depth to fully understand the technology details of the products assembled into their vehicles (relative to their Japanese counterparts).
Ask any global Tier 1 supplier which customers are more difficult to satisfy. The answer – the Japanese, no question about it. Why? Because they demand to understand in minute detail the technical characteristics of every component they use.
Unless US automakers and their suppliers learn the same principles discovered by their Japanese counterparts over the past thirty years, no bail out package will have the capability to save them from their oncoming demise.
Read more in the book, "Becoming Re-Successful" www.lulu.com/content/4339719
