Thursday, August 4, 2011

Give me a break Martin!

Martin Swig, of San Francisco Auto Center fame and automotive bon vivant, wrote this article for Sports Car Digest, “Puzzles Facing the Car Industry” (http://www.sportscardigest.com/puzzles-facing-the-car-industry/).

Somehow Swig ends up blaming CAFÉ (Corporate Average Fuel Economy) for the Chevy Vega and Chrysler Omni (don’t know how he forgot the Ford Pinto). Funny that at the same time Detroit was building these abysmal excuses for fuel efficient cars, Europe and Japan were cranking out, small, reliable, and fuel efficient cars. I would argue that if it wasn’t for CAFÉ there might not be any domestic car companies in existence. We definitely would not have the clean, fuel efficient cars we all now take for granted.

Martin says that because government couldn’t force people to buy that junk, the car companies had to offer huge discounts to sell them. This was at the time that the Japanese were kicking the crap out of the domestics; they had no trouble selling small, fuel efficient cars. Mr. Swig even ties the eventual bankruptcy of Chrysler and General Motors to the ‘70s, CAFÉ and of course the evil UAW. (It should be noted that Martin Swig’s SF Auto Center was vehemently anti-union. In union-friendly San Francisco Martin Swig successfully broke the Machinists Union.

Strange that Swig doesn’t bemoan the always huge bonuses of the upper executives at the domestic car companies. Like Nero they fiddled while Detroit fell into ruin. I remember attending a press conference with some GM big wig in the ‘80s; someone asked a question about GM’s dwindling sales and market share, asking something about maybe there was something wrong with the vehicles GM was offering the public. The answer astounded just about everyone in the room, and I’m paraphrasing but it was along the lines of, “there’s nothing wrong with our cars, the public just doesn’t appreciate real quality when they see it.”

The domestic auto makers suffered because they built a ton of crap and a lot of what was good was wrong for the market. They also lacked a strategy for the unforeseen. When fuel prices spiked, the domestics were still cranking out big SUVs and trucks.

I won’t give the UAW a pass; like their employers the UAW resisted change. In the face of shrinking sales they stuck to their age-old, and admittedly hard-won, pay and benefit formulae. As the domestics closed factories and laid off workers the UAW still resisted change. (Of course they didn’t see any suffering from the higher ups who still collected their obscene bonuses.)

I’m not sure how much stock we should put in Martin Swig’s opinions and advice; after all, he did recommend a Chevy Corvair wagon to his sister way back when.

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