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Old 11-19-2008, 12:31 PM   #1
AVANTI R5
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Default 6 myths about the Detroit 3

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The debate over aid to the Detroit-based automakers is awash with half-truths and misrepresentations that are endlessly repeated by everyone from members of Congress to journalists. Here are six myths about the companies and their vehicles, and the reality in each case.

Myth No. 1

Nobody buys their vehicles.

Reality
General Motors Corp., Ford Motor Co. and Chrysler LLC sold 8.5 million vehicles in the United States last year and millions more around the world. GM outsold Toyota by about 1.2 million vehicles in the United States last year and holds a U.S. lead over Toyota of about 560,000 so far this year. Globally, GM in 2007 remained the world's largest automaker, selling 9,369,524 vehicles worldwide -- about 3,000 more than Toyota.


Ford outsold Honda by about 850,000 and Nissan by more than 1.3 million vehicles in the United States last year.
Chrysler sold more vehicles here than Nissan and Hyundai combined in 2007 and so far this year.
Myth No. 2

They build unreliable junk.

Reality
The creaky, leaky vehicles of the 1980s and '90s are long gone. Consumer Reports recently found that "Ford's reliability is now on par with good Japanese automakers." The independent J.D. Power Initial Quality Study scored Buick, Cadillac, Chevrolet, Ford, GMC, Mercury, Pontiac and Lincoln brands' overall quality as high or higher than that of Acura, Audi, BMW, Honda, Nissan, Scion, Volkswagen and Volvo.


Power rated the Chevrolet Malibu the highest-quality midsize sedan. Both the Malibu and Ford Fusion scored better than the Honda Accord and Toyota Camry.
Myth No. 3

They build gas-guzzlers.

Reality
All of the Detroit Three build midsize sedans the Environmental Protection Agency rates at 29-33 miles per gallon on the highway. The most fuel-efficient Chevrolet Malibu gets 33 m.p.g. on the highway, 2 m.p.g. better than the best Honda Accord. The most fuel-efficient Ford Focus has the same highway fuel economy ratings as the most efficient Toyota Corolla. The most fuel-efficient Chevrolet Cobalt has the same city fuel economy and better highway fuel economy than the most efficient non-hybrid Honda Civic. A recent study by Edmunds.com found that the Chevrolet Aveo subcompact is the least expensive car to buy and operate.
Myth No. 4

They already got a $25-billion bailout.

Reality
None of that money has been lent out and may not be for more than a year. In addition, it can, by law, be used only to invest in future vehicles and technology, so it has no effect on the shortage of operating cash the companies face because of the economic slowdown that's killing them now.
Myth No. 5

GM, Ford and Chrysler are idiots for investing in pickups and SUVs.

Reality
The domestic companies' lineup has been truck-heavy, but Toyota, Nissan, Mercedes-Benz and BMW have all spent billions of dollars on pickups and SUVs because trucks are a large and historically profitable part of the auto industry. The most fuel-efficient full-size pickups from GM, Ford and Chrysler all have higher EPA fuel economy ratings than Toyota and Nissan's full-size pickups.
Myth No. 6

They don't build hybrids.

Reality
The Detroit Three got into the hybrid business late, but Ford and GM each now offers more hybrid models than Honda or Nissan, with several more due to hit the road in early 2009.
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Old 11-19-2008, 12:46 PM   #2
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So based on "reality" #1, GM is the stupidest car company.
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Old 11-19-2008, 12:52 PM   #3
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They do, however, don't build cars that appeal to a lot of the up and coming generation and a lot of those in their 20's. They're getting better, but not great. Interiors aren't very inspiring and their best efforts lately seem to have been retro styled bits while the more affordable cars tend to be bland in comparison to similar import offerings.
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Old 11-19-2008, 12:54 PM   #4
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General Motors Corp., Ford Motor Co. and Chrysler LLC sold 8.5 million vehicles in the United States last year and millions more around the world. GM outsold Toyota by about 1.2 million vehicles in the United States last year and holds a U.S. lead over Toyota of about 560,000 so far this year. Globally, GM in 2007 remained the world's largest automaker, selling 9,369,524 vehicles worldwide -- about 3,000 more than Toyota.
But at what cost have those sales been made? They've been selling pickup trucks at huge, huge, huge discounts and are surely not turning any profit. Look at the profit numbers - GM lost billions in Q3, but Toyota made several billion in Q3. Do raw sales count for anything if every sale you make means you are losing more and more money?

Quote:
The domestic companies' lineup has been truck-heavy, but Toyota, Nissan, Mercedes-Benz and BMW have all spent billions of dollars on pickups and SUVs because trucks are a large and historically profitable part of the auto industry.
But the domestic companies relied too heavily on trucks, and didn't have any quality small cars to push to the forefront when gas prices took a major leap. They put all of their eggs in one basket, and that is what was idiotic.

Quote:
The Detroit Three got into the hybrid business late, but Ford and GM each now offers more hybrid models than Honda or Nissan, with several more due to hit the road in early 2009.
But GM, at least, suffered a huge problem with a battery recall that basically took out all of their supply. That has affected their ability to produce and sell hybrids. What's the use of having many models if you can only push out a handful?
From GM's site, for sales in Oct 2008: GM hybrids continue to build sales momentum and the company has broken through the 10-thousand vehicle sales mark. A total of 1,496 hybrid vehicles were delivered in the month. Hybrid sales included: 372 hybrid Chevrolet Tahoe, 193 GMC Yukon and 230 Cadillac Escalade 2-mode SUVs delivered. There were 325 Chevrolet Malibu, 22 Saturn Aura and 354 Vue hybrids sold in October. GM has sold 10,549 hybrids so far in 2008.

Meanwhile, in October alone, Toyota sold 11,804 Priuses.

I think that the "Detroit 3's" reliance on model numbers is also misleading. Yes, they have more models in raw numbers.. but all of the models are basically the same thing with different badges. The hybrid Yukon, Tahoe, and Escalade are technically three models, but they're the same car underneath.
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Old 11-19-2008, 01:02 PM   #5
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^^^

Like the Aveo,Now they could of done better than that.Then they slap a rebadge and call it a G3 or something for the Pontiac Division.
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Old 11-19-2008, 01:05 PM   #6
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Globally, GM in 2007 remained the world's largest automaker, selling 9,369,524 vehicles worldwide -- about 3,000 more than Toyota.
Yes. GM sold 9.37 million cars last year. Toyota sold 9.37 million cars last year.
Hmm. Looks liek a dead heat. And since GM can barely keep afloat and is begging for gov't help, i think that puts toyota very well on par to demolish GM this year. If GM is even around by next year.

How about some overall 2007 sales growth?

Chrysler Group –3.4% at 2,076,650 (2006: 2,142,505)
Ford Motor Co –12.1% at 2,572,599 (2006: 2,918,674)
General Motors –6.5% at 3,866,620 (2006: 4,124,645)

Honda America 2.5% at 1,551,542 (2006: 1,509,358)
Nissan North America 4.5% at 1,068,238 (2006: 1,019,249)
Toyota Motor Co. 2.7% at 2,620,825 (2006: 2,542,524)

Who's selling more? who's selling less? seems pretty clear cut to me.

Wanna claim a domestic is reliable? ask anyone with one. Why did the camry take the #1 selling vehicle car spot away from the Taurus years ago, and hasn't let up since?

Aww. Give up domestics, roll over in your grave and go back to sleep.

Last edited by neko; 11-19-2008 at 01:12 PM.
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Old 11-19-2008, 01:12 PM   #7
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Quote:
Myth No. 2

They build unreliable junk.

Reality
The creaky, leaky vehicles of the 1980s and '90s are long gone. Consumer Reports recently found that "Ford's reliability is now on par with good Japanese automakers." The independent J.D. Power Initial Quality Study scored Buick, Cadillac, Chevrolet, Ford, GMC, Mercury, Pontiac and Lincoln brands' overall quality as high or higher than that of Acura, Audi, BMW, Honda, Nissan, Scion, Volkswagen and Volvo.
The DO build unreliable junk. All of the ratings that are being thrown around on how the US brands are equal to or better than japanese brands is largely bogus. All the ratings are of 'initial quality' and 'initial reliability'. Sorry, but I think reliability is most relevant, when a car's warranty expires. You will see many more ten year old '09 Toyotas and Hondas in 2019, than Chevys or Pontiacs.
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Old 11-19-2008, 01:12 PM   #8
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The Baby Boomers which seem to be the core Big Three buyers have defected to Camry's and Accords et al, and there's only so many 20- somethings that want a Cobalt or the like.

My wife and I (mid 30's) went to find a replacement for her 04 FXT. Her stipulations were 1) Fun to drive, 2) stick shift, 3) AWD. I did my best to find an American car to test drive, but alas NONE existed with that combination. NONE. We tested Asian, German and Swedish cars. My sig tells the story of which one won the test.

So, to recap, non-enthusiast folks around 16-25 don't want domestic cars because the stigma is that they suck. Unless their baby boomer parents are devoted domestic fans, they head to asia or germany for their rides. Some younger enthusiasts accept the few "inexpensive" domestic options like the SRT-4 and the Cobalt SS and Mustang GT because they can afford to buy them and mod them. There's really very few domestic choices available for the enthusiast. Even less for those folks that see snow near their house. People in my "seasoned" age group that want a performance car won't consider the domestics I mentioned because our peer group thinks those cars are for "kids" AND think they suck.

Of course I am open-minded, not rich and appreciate that the domestics have at least something to offer. Unfortunately until they bring something that has all the things my wife (and me too!) wants they won't be on my menu of car choices. Ever.

I hope the domestics can survive this, but I fear for their future. How does one write GM or Chrysler in chinese?
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Old 11-19-2008, 01:15 PM   #9
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How many of those sales were government vehicles? They sell an astronomical amount of vehicles to all branches of the government.

Also, "Initial Quality" means the door didn't fall off your Ford Focus in the first 3 months of owning it. They are still very far behind in the reliability sector over the long term, which is what reliability really is.
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Old 11-19-2008, 01:18 PM   #10
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Originally Posted by delongedoug View Post
How many of those sales were government vehicles? They sell an astronomical amount of vehicles to all branches of the government.
Yup, see how well Chrysler will do after the gov't finally pulls their contracts one day and switches over to toyota or honda. That should be a final bullet to the head if they're not already gone of their own mistakes.
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Old 11-19-2008, 01:24 PM   #11
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A big problem with the Big 3 is that the cars they sell are UGLY!

U-G-L-Y
You ain't got no alibi!
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Old 11-19-2008, 01:49 PM   #12
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Yup, see how well Chrysler will do after the gov't finally pulls their contracts one day and switches over to toyota or honda. That should be a final bullet to the head if they're not already gone of their own mistakes.
Right, it's a guaranteed sale of a gajillion vehicles. Think about EVERY little sector of government. Parks services, public works, police, environmental vehicles, livery and on and on and on in every single town in America. Cars, trucks and vans, oh my! It's mind-boggling.
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Old 11-19-2008, 01:57 PM   #13
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Quote:
Myth No. 7

Considering all of the above factors, the big 3 are well managed, competitive and profitable auto makers that can go head to head against the likes of Toyota and Honda.

Reality
Excuses based on cherry picked factoids and "he did it too" mentality do not change the reality.
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Old 11-19-2008, 01:58 PM   #14
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How about a few TRUTHS:

1) The list of "6 myths" demonstrates Americans PERCEPTION of the big 3. They created that perception over YEARS of non-competitive products. These are AMERICAN's perceptions of AMERICAN companies.

2) The RESALE value of US vehicles are HORRIBLE compared to most non-American brands. (Again, perception = POOR RESALE)

3) They bought all the failing or failed automakers they could in the 80-90's. Instead of investing in progress, they wanted to buy established/ failing companies which sucked more money out of them.

4) Ford shut-down its 2000 Blue Project within about 12-18 mos. It was put together to develop fuel-efficient, environmentaly conscientious vehicles. The project was basically supposed to develop the new millenium vehicle. Ford decided that these vehicles didn't have good profit margins. Trucks and SUV's were the way to go to get MOOLAH.

5) How many saw "Who Killed the Electric Car?" GM squashed EV-1 >>> No clear reason ever identified >>> Most believe PROFIT MARGIN again being the issue. Disregard the fact that the EV-1 had the highest customer satisfaction in GM history (See the Toyota Prius today).

6) How about GM and "HUMMER?"? The epitome of GM GREED.
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Old 11-19-2008, 01:58 PM   #15
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You forgot a myth; According to the big three it's extremely expensive to build cars/trucks in the US.

But Toyota, honda and some subies (well mine was at least) built (or assembled) in the US.

I think the ethics of the big three is what makes it expensive for them.
IMO
They have a lot of nerve begging for money. You know that their exec's, CFO's and CEO's are still getting mad money. That's their downfall, the whole AIG mentality. Just my opiinion though. FYI, I just couldnt buy a GM anything. Myth or no myth, everyone I know who bought a tahoe, suberban, etc are always in the shop.
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Old 11-19-2008, 02:03 PM   #16
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Originally Posted by AVOID92x View Post
How about a few TRUTHS:



5) How many saw "Who Killed the Electric Car?" GM squashed EV-1 >>> No clear reason ever identified >>> Most believe PROFIT MARGIN again being the issue. Disregard the fact that the EV-1 had the highest customer satisfaction in GM history (See the Toyota Prius today).
.
A lot of opions in the movie not many facts. Toyota had a electric car and killed them to but no one mentions that. There were many reason why the EV1 went away.
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Old 11-19-2008, 02:06 PM   #17
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A lot of opions in the movie not many facts. Toyota had a electric car and killed them to but no one mentions that. There were many reason why the EV1 went away.
AND I identified that no clear reason mentioned >>> "MOST BELIEVE Profit margins."

I personally believe the Oil companies paid them off to kill it. Again, GM greed wound up burning them in the end. Exxon has no problem making $100 billion + in quarterly profits while the companies that helped get them all that money (GM, Ford, etc) by building non-fuel efficient SUV's goes under.
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Old 11-19-2008, 02:14 PM   #18
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cant believe there were 17 posts before someone mentioned the UAW.
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Old 11-19-2008, 02:18 PM   #19
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Originally Posted by paycer View Post
The Baby Boomers which seem to be the core Big Three buyers have defected to Camry's and Accords et al, and there's only so many 20- somethings that want a Cobalt or the like.
I think you are off by a generation. From what I see the "greatest" generation are the biggest Detroit flag wavers. Remember who ushered in the age of the Yuppie, they were boomers.
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Old 11-19-2008, 02:25 PM   #20
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Like AVOID92x and others said, none of those things matter if long-term reliability and resale value are rock-bottom. Perception is 90% of reality, and even if LTR numbers are up, people still have the impression that they're still terrible. I haven't really seen anything in the Big 3's advertising to tell me any differently. That being said, as I've mentioned elsewhere, the Aura, Enclave, Acadia and Malibu are all American cars that are very appealing to me. It's just tough to pull the trigger in this economy.

-Mike
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Old 11-19-2008, 02:46 PM   #21
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Originally Posted by AVOID92x View Post
AND I identified that no clear reason mentioned >>> "MOST BELIEVE Profit margins."

I personally believe the Oil companies paid them off to kill it. Again, GM greed wound up burning them in the end. Exxon has no problem making $100 billion + in quarterly profits while the companies that helped get them all that money (GM, Ford, etc) by building non-fuel efficient SUV's goes under.
They didn't get paid off. The car was very very expensive to make. That is why they only made a limited amount and only leased the vehicles. The cars were 10 years old when the "killed" them. There was to much liablity and such to sell the used cars to people. Not to mention the market wasn't as big for electic cars then when gas was 99 cents a gallon. Alot of people wouldn't have justified the extra cost back then.

GM did make people but Fuel efficient trucks and SUVs that is what people wanted at the time. Profit margin is that the purpose of selling things anyways.
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Old 11-19-2008, 04:33 PM   #22
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Mark Phelan is an ass, every "article" of his that I have read has been nothing but praise for the domestics and finger waving at anything not American.
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Old 11-19-2008, 04:58 PM   #23
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Myth 6

They will get 25 billion of the gov.
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Old 11-19-2008, 06:21 PM   #24
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Quote:
Originally Posted by delongedoug View Post
Right, it's a guaranteed sale of a gajillion vehicles. Think about EVERY little sector of government. Parks services, public works, police, environmental vehicles, livery and on and on and on in every single town in America. Cars, trucks and vans, oh my! It's mind-boggling.
i find it heartening that UW (the university of washington) has quite a large fleet of Toyota Priuses for their white-paint official-duty vehicles.



(incidentally, so does microsoft.)
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Old 11-19-2008, 06:42 PM   #25
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Toyota had a electric car and killed them to but no one mentions that.
Toyota was basically forced into killing it.

A brief history...

Cobasys obtained the patents on large-format NiMH batteries from the inventor, Ovonics. GM sold control of Cobasys to Chevron.

Chevron sued Panasonic for patent violation. Panasonic made large-format NiMH batteries for Toyota. Panasonic believed their chemistry was different enough from Cobasys' but the court battle eventually (apparently, the judgement is sealed) awarded damages to Cobasys and ordered Panasonic to cease and desist production & sales of large-format NiMH batteries. I believe they were allowed to supply some for warranty work, but that's it. It may also be that Toyota was enjoined from producing any electric car using NiMH batteries, we really don't know and Toyota can't say without presumably paying big penalties...

So long story short: Toyota suddenly had no batteries they could use. Cobasys wouldn't sell them to Toyota, nor would they license the patents to Panasonic or anyone else. So the technology sits dormant until the patents expire...

This is probably part of the reason why Toyota is so shy on a plug-in Prius as well. Don't expect to see one from them until they have confidence in lithium batteries...

BTW, most of the surviving RAV4 EV's are still running fine and still have around 100 miles range per charge, a few have sold for big money on Ebay in the past year.
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