[SSLL]

U.S. carmakers see Midwest dominance fade
By Sharon Silke Carty, USA TODAY
BURLINGTON, Iowa — On the banks of the Mississippi River here, farmers and local business owners gather Thursday evenings in the summer to hawk fresh corn, grapefruit-size tomatoes and homemade soaps.
The farmers unload their goods from the backs of Ford (F), Chrysler (DCX) and Dodge pickups. Once the tables and pop-up tents are in place, it's like a tailgating party.

In the middle of it all is Terris Cooper, owner of T Coop's House of Bagels and Bistro, who sells baked goods from behind his white Toyota Avalon. His is the only foreign-branded car in the lot, which doesn't surprise him.

Foreign automakers with manufacturing plants in the USA
Plant location Vehicles made there
BMW
Spartanburg, S.C. X5 and Z4
Honda
East Liberty, Ohio Civic and Element
Lincoln, Ala. Odyssey and Pilot
Marysville, Ohio Acura TL and Accord
Hyundai
Montgomery, Ala. Sonata and Santa Fe
Mitsubishi
Normal, Ill. Eclipse, Endeavor and Galant*
Warren, Mich. Raider*
Nissan
Canton, Miss. Infiniti QX56, Altima, Armada, Quest and Titan
Smyrna, Tenn. Altima, Frontier, Maxima, Pathfinder and Xterra
Subaru
Lafayette, Ind. Baja, B9 Tribeca, Legacy and Outback
Toyota
Fremont, Calif. Corolla and Tacoma
Georgetown, Ky. Avalon, Camry and Camry Solara
Princeton, Ind. Sequoia, Tundra and Sienna

U.S. automakers with plants in Mexico and Canada
DaimlerChrysler
Brampton, Ontario Chrysler 300, Dodge Magnum and Dodge Charger
Windsor, Ontario Dodge Grand Caravan, Chrysler Town & Country and Chrysler Pacifica
Saltillo, Coahuila, Mexico Chrysler PT Cruiser and PT Cruiser convertible
Toluca, Mexico state, Mexico Dodge Ram quad, regular and megacab and Dodge Ram SRT10
Ford
Oakville, Ontario Ford Freestar and Mercury Monterey
St. Thomas, Ontario Crown Victoria and Mercury Grand Marquis
Hermosillo, Sonora, Mexico Ford Fusion, Mercury Milan, Lincoln Zephyr
General Motors
Oshawa, Ontario Chevrolet Impala, Chevrolet Monte Carlo, Buick LaCrosse, Pontiac Grand Prix
Oshawa, Ontario Chevrolet Silverado, Chevrolet Silverado SS, GMC Sierra, GMC Sierra Denali light duty
Ramos Arizpe, Coahuila, Mexico Chevrolet Cavalier, Pontiac Sunfire, Buick Rendezvous
Silao, Guanajuato, Mexico Chevrolet Suburban, GMC Yukon XL, Cadillac Escalade EXT, Chevrolet Avalanche, Cadillac Escalade ESV
Toluca, Mexico state, Mexico Chevrolet Silverado and Chevrolet and GMC commercial trucks
* — Shares space with Chrysler.
Source: USA TODAY research

"That's because I live in town. The rest of these guys are farmers," Cooper says, laughing. The farmers, he says, feel compelled to buy American cars out of a misplaced solidarity with blue-collar autoworkers. "They think you're hurting the working man by driving a foreign car." But his car was made in Kentucky, he argues. "Who am I hurting?"

Attitudes about buying American cars are changing in the Midwest, once easy pickings for domestic automakers. And that could spell trouble for Detroit.

General Motors (GM) and Ford Motor face tough times, with their North American auto operations losing more than $3 billion combined so far this year. The last time they were in such a crunch, in the early 1990s, "Buy American" became a rallying cry, and in the Midwest, it was almost taboo to drive anything else.

But now, it's hard to tell if many people care. "We don't have people marching down the street saying 'Buy American.' There's no collective group rally of people saying we need to do that," says Steve Delaney, editor and publisher of Burlington's daily newspaper, The Hawk Eye.

U.S. automakers' stranglehold on much of the Midwest is eroding. From 2000 to 2004, their share of the Midwest market fell from 78.6% to 71.2%, according to R.L. Polk & Co., which tracks auto registrations. Asian automakers' share went from 17.6% to 24.2%. The Midwest — North Dakota, South Dakota, Nebraska, Kansas, Minnesota, Iowa, Missouri, Wisconsin, Illinois, Indiana, Ohio and Michigan — is Detroit's biggest market. On the East and West coasts, Detroit vehicles make up about 50% of sales; in the South, they make up about 60%.

The automakers say what's happening in the Midwest isn't much different from what's happened all across the country: Asian automakers are aggressively opening dealerships and entering new segments — most notably, SUVs and pickups.

George Pipas, Ford's director of sales analysis, says any time a competitor opens a dealership, it leads to a decrease in market share.

Stopping the fall-off in heartland sales won't be easy for U.S. automakers, which face two problems:

• Asian automakers have branded themselves as quasi-American companies that are creating jobs in the USA while Detroit automakers continue to cut them. The fact that one of the traditional domestic companies, Chrysler, is now part of German-owned DaimlerChrysler further confuses the issue.

• With the economy stagnant in many parts of the Midwest, feeding job-security fears, Japanese automakers' reputations for cars that have high quality and low-cost maintenance are a lure to buyers.

Fuzzy borders

For a long time, it was clear what an American-made car was: Ford, GM and Chrysler were based in Michigan, used unionized American labor and relied on homegrown suppliers for parts. But thanks to 1994's North American Free Trade Agreement — which made it easier for U.S. automakers to build cars in Canada and Mexico — and to a push by Asian automakers to build cars in the USA, the lines aren't as clear anymore.

William Ealey, a retired Caterpillar line worker and World War II veteran, is a Buick man. Volunteering to take tickets at a demolition derby at the Christian County Fair in Taylorville, Ill., Ealey wears a T-shirt emblazoned with the American flag and the slogan, "Taking Pride in the United States of America." He acknowledges a bias against German- and Japanese-made cars because of his time in the war, when both groups were unequivocally the enemy.

His definition of an American-made car: one manufactured within U.S. borders by American employees of U.S.-based companies. "The rest of that stuff, it's not American," says Ealey, who drives a 1999 Buick Century.

When told that his Century actually was made in Canada, Ealey is visibly surprised. He pauses a moment, sets his jaw and says it doesn't matter. "They're American. They've always been American."

But it's that kind of border crossing that makes buying an American car seem like less of a civic duty for many. Japanese companies, most associated with the auto industry, accounted for 94,000 jobs in Michigan and Ohio last year, according to Japan's consulate general in Detroit, and are growing at time when other companies are shrinking.

Toyota is planning a new technical center in suburban Detroit. South Korea's Hyundai is attracting attention for its new plant in Alabama, thanks in part to a massive ad campaign showing how red, white and blue the factory is.

What really makes a car American? "I don't know, because I don't understand the entire picture," says Jack Raleigh of Decatur, Ill., a domestic-car owner. "You look at the Hyundais made in Alabama and the Toyotas made in Tennessee, and those are American jobs. And the American automakers, they're closing plants and taking away jobs. So I don't know."

Says David Shepherd, a Ford, Chrysler, GM and Toyota (TM) dealer in Fort Scott, Kan.: "It's pretty hard anymore to identify the national origin of a product by its name. ... There really isn't a truly American-made and manufactured vehicle like there may have been at one time. That has changed attitudes."

"The whole identity of a product is much less clear than it used to be," says David Cole, chairman of the Center for Automotive Research. "It reflects a true global integration of the auto industry. We are in an integrated economy, and that's life." Cole doesn't think U.S. automakers will resort to flag-waving anymore. "They just don't think it's appropriate, they don't think it will resonate that well. I think they believe that day has passed."

Tight pocketbooks

Shepherd opened his Toyota dealership in Fort Scott in 1988, after he learned people were going to Kansas City to find cars that were more reliable than the domestics they were driving. In the heart of the Little Ozarks, Fort Scott's economy relies on the fluctuating farming and tourism industries.

People here tend to buy used cars because they can't afford new. When they do buy a new car, quality is an issue, Shepherd says.

While the domestic automakers are catching up in that arena, the message hasn't gotten through, he says. "When we became a Toyota dealer, there was a huge quality gap. That gap has closed dramatically to the point where, in some cases, probably the domestics have surpassed Toyota. But the psychological gap for many folks still exists."

In the Springfield, Ill., area, farmer Stan Schutte says money is tight. Smaller farmers are being squeezed out by international operations, and manufacturing jobs are hard to come by. Job uncertainty affects the way people approach buying a car.

"Sometimes, a car is the biggest purchase you'll make in your life," he says. People turn to Japanese cars because "they're cheaper, more reliable. That's just the way it is."

Paul Ballew, GM's director of global market and industry analysis, says it could take until the end of this decade for perception to catch up with the domestic automakers' quality gains. "To get that message along, it's a drip-drip-drip effect," Ballew says. "To break through, it takes awhile. You have to be patient. You have to stick to your message."

Because they tend to hang onto their cars for years, people in the Midwest have long memories.

More than a decade ago, Springfield resident Marilyn Ferry says she was backing out of her driveway in her nearly new Mercury Villager minivan when the engine sputtered to a stop. Ferry, who still had payments left, thought the problem could be fixed. She says the dealer said it could, but only if she paid for a new engine. The experience soured her on U.S.-made cars.

She bought a used Honda Odyssey minivan, which has lasted since 1995 with only regular oil changes and no other issues.

"It isn't that I'm anti-American. I just really wanted a stable car you can count on," says Ferry, who is relying on the Odyssey to last for at least another year. "I think American cars have improved, but I'm not sure I want to take that risk."

Ironically, Ferry's Mercury minivan was designed by Nissan and powered by a Nissan-made engine, but built at a Ford plant in Avon Lake, Ohio.

Spotty loyalty

At the fair in Taylorville, Miss Christian County makes a tour, stopping to pet a prize pig and giving a hug to an adoring 8-year-old fan. Tabitha Spinner, 20, arrived at the fair in an Oldsmobile Alero, not surprising, because only three cars parked on the dirt lot were foreign brands.

"I like American cars. I think everybody should drive American cars," she says.

It might seem like a bit of politicking, but Spinner lives in the heart of one of the remaining bastions for Detroit automakers. Christian County is populated with 11 times more acres of corn and soybeans than people. Folks here like their Ford, Dodge and GMC trucks. Anything else is considered unpatriotic and damaging to the American way of life.

That's how it used to be in most of the Midwest, even in the big cities. Neighbors would chide drivers of non-American-made cars, and small-business owners feared offending customers if they were seen in a Honda.

But that's changing.

Just 25 miles north of Taylorville in Illiopolis, Ill., the Prairieland Dance Club meets every Wednesday night for a couple of hours of line dancing and socializing. Dance club president Suzi Morrow and her husband have never felt compelled to buy a car simply because of where the parent company is based. Morrow's brother-in-law is a car salesman, so the family bought cars at a discount from wherever he worked. In the 1980s, Morrow was one of the few people in her neighborhood to own a Japanese car.

People talked.

"They would be critical," says Morrow. "They would act like the Ford or Chevy they were driving was a more reliable and better car. They would say things like, 'You drive a Jap car?' or some of the even more unsavory descriptions of people from Japan." It made her uncomfortable, even when people tried to act like it was all just good-natured ribbing.

Now, Morrow's Toyota Sienna minivan has plenty of company in the Prairieland parking lot. Of 21 cars, nine are foreign brands. She'd be surprised if anyone made a derogatory comment toward her or her car now. "I'm glad those days are over," she says.

What's the best deal?

Bill Shea, owner of Shea's Gas Station Museum on historic Route 66 in Springfield, says buyers are growing immune to a brand's national origin and are just looking for the best deal.

That might be true. According to J.D. Power, domestic market share bounced back significantly for the first half of the year, thanks to GM's "Employee Discount For Everyone" promotion. GM's program was so successful in June that Ford and DaimlerChrysler matched it in July. The employee-pricing plans were scheduled to end Monday, but Ford and GM are extending discounts on 2005 models until Sept. 6, and Chrysler is extending the deal indefinitely.

The gain in market share "is all based on incentive," says Tom Libby, Power's senior director of industry analysis. He expects a reversal of that trend after the promotions end.

The success of the employee-discount deals, like the growing popularity of foreign brands in the Midwest, would be no surprise to Shea. "People don't care what the name on it is," says the 83-year-old World War II vet. "You could put my name on it or your name on it, and they don't care. It's all about the price."

[edluva]

it hasn't mattered for over a decade.

[shortydee999]

It never matter to me.

[Lost Island]

Wal-Mart doesn't even make any appearances as such anymore...

[innov8]

As far as cars go... I always buy foreign.

[subterranean]

personally, (and i'm from michigan), I find the foreign cars more appealing.

still, i think it's only a matter of time before things start leveling out. the big 3 had their reign. they'll dip for some years to come, but things will level out.

[Jersey Mentality]

No its doesnt matter, especially with nearly all out industrial base moving overseas, the only industry here in the states maybe controlled by foreign companies.

[SSLL]

'Foreign' cars rolling out of U.S. factories
Royal Ford
Boston Globe
Sept. 12, 2005 12:00 AM
Next time you see a new foreign-brand automobile, odds are it was made in America.

Toyota, Honda, Subaru, BMW, Mercedes-Benz, Hyundai and others - more than 40 models of foreign cars, minivans, SUVs and pickup trucks - are rolling off assembly lines at 15 plants in the United States so rapidly that last year brought a tipping point.

For the first time, more foreign-brand vehicles sold in the United States were built here - 3.7 million - than were imported - 3.4 million - according to the Center for Automotive Research, non-profit auto-industry analysts in Michigan.

That's a sea change from 20 years ago when 460,000 foreign-brand vehicles were built in the United States while 3.6 million were imported, according to the automotive forecasting wing of J.D. Power and Associates, a California information-service company.

The latest Power projections for 2005 estimate that 4.8 million of the 7.2 million foreign vehicles that will be sold here will be built here.

The evolution reflects automakers' strategy to build plants closer to buyers, the ever-growing popularity of foreign-brand vehicles and the blurring of what "made in America" means.

Is the wildly popular Chrysler 300C a foreign car because Chrysler now is owned by the German company DaimlerChrysler AG? What about a Honda Odyssey minivan, built by American workers and rolling off an assembly line in Lincoln, Ala., or the first big Toyota Tundra pickup to roll out the doors of a new plant in the heart of hard-trucking Texas?

To many people, it doesn't matter. "A brand's a brand, and people don't care where it originated," said Ron Harbour, president of Harbour Consulting, a Troy, Mich., manufacturing and management consulting firm.

"They can't tell you where it was built or even what country it was built in."

Lonnie Miller, director of industry analysis for R.L. Polk & Co., a Michigan auto information and marketing firm, said that a new generation of young buyers, increasing populations of Asian and Hispanic Americans, even increasing numbers of older buyers choose vehicles not based on brand loyalty or national fealty, but on "what car best fits their image, or the car rated most reliable or most fun."

He called the change "a fundamental shift to what the car is offering as opposed to the hood ornament."

The establishment of foreign plants in the United States gives their manufacturers the economic advantages of cutting huge overseas shipping costs and of protecting themselves from fluctuations in currency values.

The bulk of these plants are new, modern and more nimble than Detroit's facilities.

Foreign-owned plants offer the flexibility to build as many as four or five models in the same factory, nearly double that at many American plants. This is a critical advantage in an automotive age where runs of as few as 30,000 of certain models are all that are needed to fill a crucial niche in sales.

What's more, foreign brands use their American presence to persuade even loyalist American-only buyers that the vehicle they are buying is American-made.

Honda, with plants in Ohio and Alabama, is having success selling Americans that "even though it's a foreign brand, it's a domestic vehicle," said Mike Chung, an analyst for the automotive Web site Edmunds.com.

Toyota said one reason it is building its near-billion-dollar pickup plant, capable of producing 200,000 Tundras per year, in San Antonio is that it goes right to the heart of the American vision of trucking: big, wide open, rugged.

"It's the first time we chose a location for marketing reasons," said Dan Sieger, spokesman for Toyota Motors North America. "Texas is the biggest pickup market in the country, probably making it the biggest in the world, and to have a truck built by Texans can only make it better."

The culture change is dramatic. In the 1970s, more than 70 percent of the vehicles sold in the United States were American-made, but by last year domestic sales had fallen, to 58.6 percent.

On the East and West coasts, the split is almost even, according to R.L. Polk. The differences are wider elsewhere. Only the South (60.4 percent domestic) and the Midwest (71.2 percent) are keeping American manufacturers in the lead.

The gap continues to close. Polk's Miller noted that states the U.S. Census Bureau ranks among the fastest growing - Arizona, California, Florida, North Carolina and Texas - are hotbeds of growing populations of young and immigrant buyers who prefer foreign-brand vehicles.

The surge in gasoline prices certainly could close the gap further.

Any significant turn from SUVs and trucks, which burn more gas, easily could nudge Americans to foreign vehicles, which have a better reputation for fuel efficiency and quality.

[COtoOC]

My parents always were and still are big on buying American cars. I also saw what pieces of crap they were even as a kid. My first couple cars were GMs and they were total crap. After buiyng a Japanese car and realizing that 3 year old cars don't have to cost $300 a month in repairs to keep them running, I've never had anything but foreign cars. Funny though, because my parents' Dodge and Chrysler were made in Mexico and Canada but my Nissan was made in the U.S.

I'll buy American when they can build a reliable car, but somehow I think GM will go out of business before that happens.

[James Bond Agent 007]

^
Why do so many people still think Detroit makes only crappy cars?

Has anyone looked at quality rankings lately (like JD Powers)? Detroit cars hold their own against European and Japanese cars these days.

[SSLL]

Some of the new domestic cars are awesome, and a lot of them are really reliable.

[edluva]

^
Why do so many people still think Detroit makes only crappy cars?

Has anyone looked at quality rankings lately (like JD Powers)? Detroit cars hold their own against European and Japanese cars these days.

there's an ocean of difference between mere quality, and refinement. just because american cars don't fall a part anymore doesn't mean they're going to be desireable.

[James Bond Agent 007]

^
COtoOC's comment was about American cars not being "reliable." I merely was responding to that.

Obviously different people will have different stylistic tastes in cars, so if someone happens to like the designs of Nissans compared to Chevy's, there's no way to dispute that. But that's merely a subjective criteria.

[COtoOC]

^
Why do so many people still think Detroit makes only crappy cars?

Has anyone looked at quality rankings lately (like JD Powers)? Detroit cars hold their own against European and Japanese cars these days.

Because I've driven them and had family members who've driven them. I still see things like my parent's PT Cruiser that had a bad oil leak around 30K miles and someone at work who had to replace an entire engine in a 4 year old Malibu. I can also see how terrible GMs especially have aged. A 10-year-old GM usually has fading paint, broken parts and generally looks like crap. Granted it makes a difference if the car is garaged and well-driven. I also dislike the styling of pretty much any Chrysler product with their new "muscle car-ish" designs and many GMs look like 10-year-old styling, although they're starting to catch up on styling. I think the new Cobalt is a decent looking car (I'll only consider small, high-mileage cars) but I doubt if I'd buy one because I'd be afraid of getting burned when it starts falling apart in 3 or 4 years. Ford's styling isn't bad either.

Those quality ratings really don't tell you much. Most are based off how many of a certain model come back to the shop in the first 6 months or first year. To me the real quality is when you can hit 100K miles without anything other than expected maintenance. That's why I drive a Nissan.

[Jersey Mentality]

^ yeah I just bought a Nissian myself, well my insurance did after my Buick got totaled. I never had problems with that Buick although it was a 2001 it ran good up until that accident.

[James Bond Agent 007]

Well I had a Honda Civic once which had plenty of problems. Maybe it's just a matter of luck.

[COtoOC]

Well I had a Honda Civic once which had plenty of problems. Maybe it's just a matter of luck.

I definitely think there's a "luck factor" involved. That and the way you drive and take care of your car.

[edluva]

^
COtoOC's comment was about American cars not being "reliable." I merely was responding to that.

Obviously different people will have different stylistic tastes in cars, so if someone happens to like the designs of Nissans compared to Chevy's, there's no way to dispute that. But that's merely a subjective criteria.

I understood your point. I was merely pointing out that yes, while refinement is a subjective criterion, most people would be able to differentiate between a Saturn and a Lexus, despite the fact that JD Power says neither of them fall apart quickly. refinement counts, even if it's not quantifiable.

[James Bond Agent 007]

Whatever . . .

[edluva]

I'll take that as a reply then.

[Evan]

I live only 35 miles from the Honda factory in Lincoln, Alabama and it has for the most part, saved this town. Our 2nd largest industry closed down a few years ago, putting 1800 people on the street. 900 people from my county now work at Honda, another few hundred people work at the numerous feeder/supply plants that sprang up in counties surrounding the factory, including my own. Luckily, the Honda plant was already about to open when Gulf States closed down, so people here just played the waiting game until the plant started hiring.

As for reliability, I own a Toyota 4-Runner, a little Ford Ranger for buzzing around town, and a Ford Mustang I've had since I was in high school.

The 4-Runner has been recalled twice, for small things, but it is hella reliable. It isn't driven as much now since gas went through the roof, but it is a good solid SUV that has caused me no real problems.

On the other hand, you could drive my little Ranger into the river, and it would still start up and run. It is a cheap little truck, but solidly built and it has 98,000 miles on it and i have had zero problems with it.

The Mustang has become more problematic, but it is nearly 20 years old and has over 160,000 miles on it, but overall, it has been an amazing auto, causing me very little trouble. It has taken me across the country twice without incident. I am really going to be sad when that car finally dies, because I have never loved a car like I love that one, but the body is going to fall apart long before the engine does.

I guess what I am trying to say is, yes Detroit has and still can build some shit, but I also have to be fair and say that my experience with American cars has overall been positive. I would not be afraid to go down and put my hard earned money on an American car. In the 70's no. They were shit. In the 80's they improved alot in reliability, they were just rather generic looking. These days though, I have no issues with most American cars.

Sorry for the long post.

[pablosan]

How many foreign components are in American made products? At this point global industrialization has changed they way things are manufactured.

[edluva]

^american auto is the still same same cash cow that produced junk two decades ago. it's just a lot more globalized. the way things are manufactured hasn't really changed all that much. gm and ford are still unable to innovate because they're still lagging in per-vehicle cost compared with foreign counterparts - their focus on the suv and truck segment has kept them afloat until now. the amount of liability inherited from organized labor and poor management are to blame. the origin of parts or labor has very little to do with it.

[PA Pride]

That article is ridiculous.... Why would anyone only buy American made products just because it's got a sticker of old glory on it? As a smart consumer, everyone should be buying the best quality item for the best value, no matter what country it's made in and that is what determines which company sells the most product. Do you think someone in Japan should only buy products made in their country? If a foreign construction company refused to buy Caterpillar machinery then people in the US working for Caterpillar would be losing their jobs.... It's been proven over and over that free trade among all the countries of the world is what creates compeitition and forces better quality merchandise to be made for the cheapest price possible. It's a win-win for EVERY economy. You can't have a protectionist attitude towards global trade or you will get left behind in economic competitiveness.

Why can't hillbillies understand how a global economy and a free market system work?

Does ANYONE agree with me?

[Evan]

That article is ridiculous.... Why would anyone only buy American made products just because it's got a sticker of old glory on it? As a smart consumer, everyone should be buying the best quality item for the best value, no matter what country it's made in and that is what determines which company sells the most product. Do you think someone in Japan should only buy products made in their country? If a foreign construction company refused to buy Caterpillar machinery then people in the US working for Caterpillar would be losing their jobs.... It's been proven over and over that free trade among all the countries of the world is what creates compeitition and forces better quality merchandise to be made for the cheapest price possible. It's a win-win for EVERY economy. You can't have a protectionist attitude towards global trade or you will get left behind in economic competitiveness.

Why can't hillbillies understand how a global economy and a free market system work?

Does ANYONE agree with me?

Dude, I agree with you. I won't buy something just because it has a "Made In USA" sticker on it. If I do buy an American auto, it is because it suited my needs, like my truck did, but I don't base my buying decisions on where something was made. If that were the case, I would have no televisions, no DVD players, no VCR, blah blah and so forth.

The American mindset of many is still stuck in the 1970's when the entire country was pounding on the BUY AMERICAN tom tom, and running around slicing the tires on Japanese cars and throwing their Sony products in the river. That's some ig'nunt redneck bullshit that unfortunately, is still in pockets all around the country.

I buy what I need, and like most people I consider price, needs, and my situation when making decisions. I don't give 2 farts in the wind where something was made. Toledo or Toykyo. Evan doesn't care, just give me a good product at a good price and I'm happy.

I am every bit as likely to buy an American product as an imported one IF it suits my needs and my price range, and vice versa, but I won't buy something just because it was made in an American factory by American workers.

This is the real world not a fantasy land. Like I said in my post above, I have no issue with the reliability of American cars these days, but that doesn't mean I am going to run out and buy a shitty base model Chevy just because its American when I can get a shitty base model Toyota for the same and sometimes, even lower price.

There is such a thing as national pride of course, but there is also such a thing as just being a dumbass redneck thinking that if it wasn't made in America, then you don't want it.

[phillyskyline]

I agree w/ both of you. I only buy foreign cars myself. My Dad is still driving his '93 Toyota Camary with 202K miles around with no problems! That is some ingenuity.

[lost carolinian]

That article is ridiculous.... Why would anyone only buy American made products just because it's got a sticker of old glory on it? As a smart consumer, everyone should be buying the best quality item for the best value, no matter what country it's made in and that is what determines which company sells the most product. Do you think someone in Japan should only buy products made in their country? If a foreign construction company refused to buy Caterpillar machinery then people in the US working for Caterpillar would be losing their jobs.... It's been proven over and over that free trade among all the countries of the world is what creates compeitition and forces better quality merchandise to be made for the cheapest price possible. It's a win-win for EVERY economy. You can't have a protectionist attitude towards global trade or you will get left behind in economic competitiveness.

Why can't hillbillies understand how a global economy and a free market system work?

Does ANYONE agree with me?


In complete agreement.

I could go into my personal and family's experiences with American cars, but it's the same story that everyone knows.

Even my old school father has finally had enough and vowed to go foreign next time. My in-laws, on the other hand, still have that irrational will to buy domestic.

American auto-makers had their chance to listen to William Deming back in the day, but opted to ignore his doctrines in statistical process and quality control. The Japanese listened, though, and he is viewed as being largely responsible for the post-war revolution in Japanese industry becoming quality and recognized as such.

Not that the American companies can't implement the same methods. I suppose that it boils down to management and business models. Maybe Detroit will wake up someday.

[James Bond Agent 007]

My in-laws, on the other hand, still have that irrational will to buy domestic.
There's nothing irrational about it.

[lost carolinian]

Actually, I can't really blame them. They've not had my luck with American cars, and Chevrolet seems to be on the better side of quality, as far as domestic alone is concerned.

After MY Saturn and Ford experiences, on the other hand, it would be highly irrational for ME to ever buy American again! Shame on me once and twice. Not about to repeat. ;)

[edluva]

Shame on me once and twice. Not about to repeat. ;)

fool me once, shame on ... shame on you... if fooled i can't get fooled again

[James Bond Agent 007]

To be honest, I don't really understand this "Japanese cars last longer" stuff. I see WAY more old American cars on the road than old Japanese cars.

[edluva]

i thought you already established that american cars have caught up in reliablilty.

[James Bond Agent 007]

^
That was my whole point.

In spite of the fact that I pointed that out, there's still a lot of people in this thread claiming that American cars break down easier and don't last.

But if that's true, then how come I still see so many Chevy's and Fords from the 60's, 70's and 80's on the road, but very few old Toyotas or Hondas.

When was the last time you saw a 70's or 80's Corolla still on the road? I probably haven't seen one for five or ten years.

On the other hand, I see old American cars on the road *all the time*

[lost carolinian]

To be honest, I don't really understand this "Japanese cars last longer" stuff. I see WAY more old American cars on the road than old Japanese cars.


What, like at Carlisle in September?

j/k

Define "old."

[James Bond Agent 007]

^
Older than about 10 or 15 years.

I almost *never* see a Japanese car older than 15 years old still on the road.

But I still see old junker American cars on the road *all the time* - and I'm not just talking about collector cars.

For one example, last fall I used my boss' father's '78 Plymoth station wagon for about a month. Though it certainly had problems, it still ran and was in OK shape.

In contrast to that '78 Plymouth, I can't possibly remember the last time I saw a '78 Honda or Toyota still on the road.

[lost carolinian]

^
That was my whole point.

In spite of the fact that I pointed that out, there's still a lot of people in this thread claiming that American cars break down easier and don't last.

But if that's true, then how come I still see so many Chevy's and Fords from the 60's, 70's and 80's on the road, but very few old Toyotas or Hondas.

When was the last time you saw a 70's or 80's Corolla still on the road? I probably haven't seen one for five or ten years.

On the other hand, I see old American cars on the road *all the time*

Ahh, that's your "old." That's in part because prior to the eighties the Japanese models WERE crap! According to my almanac, the US market for Japanese cars did not really pick up until the mid-eighties.

The real answer to your question, however, lies in the fact that domestic sales have always been greater than foreign. In 1985 for example, domestic sales were 8,204,542 units versus total import sales of 2,837,745. Simply more domestics on the road to begin with.

Japanese sales actually decreased steadily and consistently over time relative to domestics. Hmmm, could this be because Japanese cars LAST?!

A truly fair comparison would be percentage remaining on the road by class (dom., for.) and model year.

[lost carolinian]

He heh. I bet in France all of the cars on the road are new because:

Quote: "On an average Saturday night in France, he said, youths burn about 100 cars."

http://www.cnn.com/2005/WORLD/europe/11/13/france.rioting.ap/index.html

Never mind the riots!

:haha:

[James Bond Agent 007]

^^
I disagree. I don't know how old you are (I'm 41), but there were tons of people buying Japanese cars in the 70's and 80's . . . and one reason why people bought them was because they were purportedly of better quality than American cars. I had a 79 Honda Civic for a few years. But it had plenty of problems.

If there was about an 8:3 ratio of domestic to foreign cars sold in 1985, how come (aside from European cars), I *still* see FAR fewer foreign cars from around 1985 on the road than American cars? The ratio of American cars to Japanese cars from around 1985 that I still see on the road is more like 15:1, not 8:3.

Based on what I see on the road, I have no choice but to conclude that American cars last longer than Japanese ones. Start observing this yourself: Look around at all the old cars you see on the road, and notice how few of them are Japanese, and how many of them are American (and lots of European ones, too).

[James Bond Agent 007]

Japanese sales actually decreased steadily and consistently over time relative to domestics.
No way!!!

You yourself just said that Japanese car sales started taking off in the mid-80's. Now you're saying that their market share has been declining????

If the Japanese market share has been declining, then how come GM is having to lay off 30,000 due to overcapacity and declining market share? (Ditto Ford)

[lost carolinian]

No way!!!

You yourself just said that Japanese car sales started taking off in the mid-80's. Now you're saying that their market share has been declining????

If the Japanese market share has been declining, then how come GM is having to lay off 30,000 due to overcapacity and declining market share? (Ditto Ford)

Pick up an almanac and look at the hard DATA. Share on the rise from 1980, peaked in 1986, on the decline from there.

You're basing your entire argument on your demographic area. I live in yuppie Volvo-land, and it's primarily Japanese and European where I live. That's a small part of the universe and not representative of the whole, obviously.

WRT your second comment, I believe that all boils down to good old supply and demand does it not?

[James Bond Agent 007]

No way!!!

You yourself just said that Japanese car sales started taking off in the mid-80's. Now you're saying that their market share has been declining????

If the Japanese market share has been declining, then how come GM is having to lay off 30,000 due to overcapacity and declining market share? (Ditto Ford)

Pick up an almanac and look at the hard DATA. Share on the rise from 1980, peaked in 1986, on the decline from there.
Japanese market share is currently at an all-time high:
--> Click here (http://www.finfacts.com/irelandbusinessnews/publish/article_10003794.shtml) <--


You're basing your entire argument on your demographic area. I live in yuppie Volvo-land, and it's primarily Japanese and European where I live.

This is even more the case on the West Coast (where I live) than any other part of the country.

About half of the cars sold here are foreign - mostly Japanese. It's been like this almost ever since I moved here in '88.

And in spite of that, I *still* see far more old American cars on the road here than Japanese cars. I see very few Japanese cars from the 80's on the road anymore, while American cars from the same decade are still fairly common.


WRT your second comment, I believe that all boils down to good old supply and demand does it not?
Yes, it's supply and demand. Demand has been greater and increasing for Japanese cars, and declining for American cars. In other words, domestic makers' market share has been going down, and foreign (mostly Japanese) market share has been going up.

[SSLL]

GM cuts jobs, will shut plants
It’s company’s largest reduction since 1991

By Rick Popely
Tribune staff reporter
Published November 21, 2005, 9:52 PM CST

General Motors Corp., confronting the biggest challenge in its history--survival--swallowed a bitter pill Monday and announced a massive plan to shrink itself.

The company that once dominated the global auto industry but is now hemorrhaging losses said it will reduce its North American manufacturing capacity by nearly 20 percent, or 1 million vehicles. It will close four assembly plants, one production line at another plant and four other production facilities by 2008, eliminating 30,000 jobs, most through attrition.

The decision represents the largest-scale cuts GM has undertaken since it closed 21 North American plants and eliminated 74,000 jobs over four years starting in 1991.

When the slashing is done, GM will be configured to build 4.2 million cars and trucks in North America, enough to supply as much as one in four vehicles that Americans buy. But it is almost certain that GM will never again dominate the industry as it did in the 1960s when it manufactured more than half of the vehicles on the road in the U.S.

"They absolutely had to do this," said analyst Rebecca Lindland of research firm Global Insight.

What's more, GM's decision to take significant capacity out of the industry is likely to level a devastating blow to the already struggling auto supply industry.

Several suppliers teetering on the brink may soon follow auto supply giant Delphi into bankruptcy, forcing the elimination of more manufacturing jobs while putting even greater pressure on the Midwest economy, analysts say.

Even after the cuts, GM will be in a position to be America's biggest automaker, but with a diminished margin over hard-charging Toyota. Of much greater significance is that the company hopes to post a profit on that scale of business, though its fortunes have fallen so far there is no guarantee the company will recover.

This year, GM is on track to lose at least $4 billion. Saddled with the high cost of union labor and facing intense competition by nimble Japanese and South Korean car companies, as well as an accelerating Chrysler Group, GM has seen its market share drop 4.6 points since 1997.

Adding to its woes, Delphi, its major auto parts supplier, is threatening to strike, possibly costing GM even more money if its supply line is disrupted. The situation is so bad that some analysts are counting GM's cash hoard--still a voluminous $19 billion--and calculating how long before America's most venerable manufacturer runs out of money and must file for Chapter 11 itself.

GM had signaled it was ready to take drastic action, but Monday's announcement was bigger in scope than expected. Originally the company was looking at cutting 25,000 jobs.

GM's plans were announced in Detroit by Chairman and Chief Executive Rick Wagoner, who has been under growing pressure to turn around the struggling automotive giant. The idea is to wring efficiencies by cutting production capacity until it is in line with sales.

Global Insight estimates GM's 30 North American assembly plants are running at 78 percent of capacity this year. With the closings, it projects GM will run at 95 percent by 2009, even as its U.S. market share shrinks to 23 percent from the 26.6 percent it had through September.

"This will get them more to where they need to be in production capacity," Lindland said. "The ideal situation is to run your plants 24/7."

GM held 31 percent of the U.S. market as recently as the mid-1990s.

"It's unrealistic to expect them to get back to 30 or 35 percent," Lindland said. "They're better off restructuring to 23 percent [market share]. Anything above that is a bonus."

If demand exceeds GM's reduced capacity, plants can work overtime or add third shifts, Lindland added.

Toyota No. 1 by '06?

Toyota's U.S. share has grown to 13.2 percent this year from 8.1 percent in 1997. As GM retrenches and Toyota expands, the Japanese company could overtake GM as the world's largest automaker, based on production volume, as early as next year.

GM has lost $3.8 billion so far this year, mainly in North America, and its credit rating has dropped to "junk" status, raising the question of future viability.

"These actions are necessary for GM to get its costs in line with our major global competitors," Wagoner said in a teleconference.

He did not give a timetable for GM to be profitable but said the cuts would reduce annual operating costs by $7 billion by the end of 2006--$1 billion more than a previous target.

Most of the 30,000 blue-collar job cuts will be made through attrition, but Wagoner said some would be through early-retirement buyouts. He said restructuring costs from buyouts and plant closings would be "significant" but gave no details.

Buyouts costly

J.P. Morgan analyst Himanshu Patel estimates that buyouts of union workers would average $80,000, and the tab could hit $917 million. "Other restructuring charges could equal or exceed this buyout amount," Patel said in a research note.

GM's restructuring sets up contentious contract negotiations in 2007 with the United Auto Workers, which decried the cuts as "extremely disappointing, unfair and unfortunate." The UAW represents 107,000 GM workers, nearly half of whom will be eligible for retirement in the next three years.

GM can idle plants before the contract ends in September 2007, but closings are negotiated as part of new contracts. UAW workers laid off next year will be placed in a "jobs bank" and receive most wages and benefits through the contract if there is no work for them.

The union and GM are in talks about plant closings and the fate of the affected workers, and GM is expected to press the UAW to eliminate the jobs bank. The union also fears that GM will import more cars from Daewoo, its Korean subsidy.

"Today's announcement clearly makes those negotiations much more difficult," UAW President Ron Gettelfinger said in a statement. "Workers have no control over GM's capital investment, product development, design, marketing and advertising decisions. But, unfortunately, it is workers, their families and our communities that are being forced to suffer."

Janesville plant spared

Several analysts had identified GM's Janesville, Wis., plant as a likely candidate for closing because it builds full-size sport-utility vehicles, whose popularity has taken a hit recently. But the plant, which opened in 1919, survived the cut.

Those assembly plants closing are located in Doraville, Ga., Oklahoma City, Ontario, Canada, and Lansing, Mich. One Saturn production line at Spring Hill, Tenn., also will close. Among the other facilities to be shut down are stamping and powertrain plants in Lansing, Pittsburgh, Flint, Mich., and Ontario.

Though it has prodded GM to take such drastic action, Wall Street was underwhelmed by the news. Merrill Lynch analyst John Casesa said that's because the cuts won't address GM's biggest problem: a lack of products that compel consumers to buy.

"Ultimately, to successfully restructure GM there will need to be a significant increase in product investment," Casesa said. "It is impossible for GM to cost-cut its way to sustainable profitability."

GM's shares fell 47 cents Monday to $23.58 in New York Stock Exchange trading. The stock had gained $2.95 Thursday and Friday after Wagoner told GM employees the company was not considering bankruptcy.

Ford Motor Co., which faces struggles of its own, expects to announce plant closings and job cuts in JanuaryPart of that plan emerged last week when workers were told in a company-wide e-mail that 4,000 white-collar jobs would be eliminated in 2006.

[SSLL]

What bankruptcy would mean to GM

Plunging market share, huge layoffs and a copycat filing by Ford. Those are just a few of the likely outcomes if GM can't avoid bankruptcy court.

By Robert Walberg

Rick Wagoner, chief executive of General Motors, has tried to comfort investors by saying GM has no plans to file for bankruptcy protection.

Cold comfort, I'd say. The company's deeds, if not the CEO's words, point to an acute need for some sort of bankruptcy plan, even if just as a contingency. Consider: GM (GM, news, msgs) lost nearly $4 billion over the last year; its credit rating dropped to junk status; car sales plunged as GM built bigger cars and trucks just as gas prices skyrocketed; its cash horde has been cut nearly in half; and its leading parts supplier, already in bankruptcy, faces a possible strike that could shutter GM plants for weeks if not months.

It would be irresponsible of management not to at least have some bankruptcy plan in the works, so that if the worst-case scenario did play out, they would be ready with a recovery plan. Below, I'll outline what a GM bankruptcy might look like, and how it would impact workers and competitors.

No leadership, no vision
First, a quick look at what management is doing now. GM's main push in coping with its current troubles is to cut back production deeply enough to create a balance between supply and demand. To achieve this objective, management announced that it will be closing a total of 12 plants and support facilities and slashing 30,000 employees by the end of 2008.

Basically, this course is a tacit admission by management that it has no interest in developing a plan to increase customer demand for its cars. That would require real vision, real leadership and real innovation. These are not traits Wagoner has displayed to date.

[lost carolinian]

Japanese market share is currently at an all-time high:
--> Click here (http://www.finfacts.com/irelandbusinessnews/publish/article_10003794.shtml) <--



Right, and in this case the market trend upward can be attributed to different reasons (as the articles describe).

I'll give you the benefit of the doubt that your observation about seeing more older American cars on the road in your area is valid.

One thing that occurred to me is that older American cars may be more appealing to work on than foreigns (??). I don't know. Just a guess. At some point any car is going to require repair in its lifetime. I have a 1970 Olds quietly rusting under a cover patiently waiting its one day restoration. Personally, tinkering on an '85 Civic wouldn't be as gratifying. Perhaps to someone else.

But a newer American car for day to day? Not for this customer.

[edluva]

^^
Based on what I see on the road, I have no choice but to conclude that American cars last longer than Japanese ones. Start observing this yourself: Look around at all the old cars you see on the road, and notice how few of them are Japanese, and how many of them are American (and lots of European ones, too).

that is a faulty conclusion. there are cultural factors that might explain why people who were likely to purchase american cars during that time choose to keep their cars, while those who purchase japanese weren't. my 97 accord is running tip top at 190,000, but i'm already looking for a new car anyways. my neighbor tinkers with his 83 chevy all day long, but it's always been his baby.

also, you're going by personal observation. where you live might not be the case elsewhere. and the quality of japanese cars WAS superior to domestic in the 70s-80s. that has never been a controversy. even domestic auto admits it.

[sequoias]

I have known that Japanese cars last longer on average than American from what I've seen, tho it depends how the owner takes care of the car and reliabity varies by mileage and owner.

My car has 80,000 miles on it and still runs fine, It's a 1994 Honda civic, too. I had a 1983 Honda Civic and it still ran fine with 210,000+ miles on it and broke down only ONCE because of the manual transmission went out and got it rebuilt and back up running again, during my mom had it and gave it to me. Also, my parents 1993 Honda Accord had 175,000 miles on it and still ran great, sold it and got a 2005 Honda Accord. Also, the 1986 Nissan truck they had had 138,000 miles on it and still runs solid.

Let me tell you this, I'm a bit surprised to hear my co worker has a 1986 Oldsmobile Cutlass with 500,000 miles on it and still runs, but beginning to fall apart. It's american...don't ask me how it still runs. :-P

My girlfriend has a 1991 Pontiac Sunbird, it breaks down almost all the time and has problems time to time.

[SSLL]

Toyota is poised to race past GM
By Hans Greimel
THE ASSOCIATED PRESS
Wednesday, Nov. 23 2005

WHAT'S HAPPENING: General Motors could lose its title as the worldwide leader
in automobile production.
WHY: Toyota is increasing its production in the United States, while GM is
cutting its North America factories.
WHAT COULD CHANGE: GM is making gains in Asia, which could hold off Toyota's
claim.


TOKYO

Toyota Motor Corp. is quickening its quest to unseat ailing rival General
Motors Corp. as the world's biggest automaker with reported plans to start
manufacturing up to 100,000 Toyota vehicles at a Subaru factory in Indiana.

Word of Toyota's ramped-up production schedule comes only days after
money-losing GM said it will close 12 facilities by 2008 in a move that will
slash the number of vehicles it is able to build in North America by about 1
million a year.

The combined developments could help Toyota surpass GM in worldwide production,
although it's unclear if that would happen because Detroit-based GM is growing
rapidly in Asia.

Toyota expects to produce 8.1 million vehicles this year, while GM expects 9
million, according to Greg Gardner of Harbour Consulting, a manufacturing
consulting firm.

Toyota will also chip away at GM's lead with a new pickup plant scheduled to
open next year in San Antonio that will add 200,000 vehicles to Toyota's annual
capacity.

The Japanese company's output will be boosted by another 100,000 vehicles in
2008, when Toyota's new RAV 4 plant comes online in Canada.

Under the latest expansion plans, the world's No. 2 automaker has asked Fuji
Heavy Industries, maker of Subaru autos, to start building Toyotas in 2007 at a
Lafayette, Ind., factory operated by Fuji's wholly owned subsidiary, Subaru of
Indiana Automotive, the Asahi newspaper reported Wednesday, without identifying
its sources.

Company representatives were unavailable for comment on Wednesday, a national
holiday in Japan.

Ann McConnell, a spokeswoman for Subaru of Indiana, said Fuji Heavy Industries
and Toyota Motor Corp. have been in discussions, but that there has been no
word of a decision.

There are five to six candidate models for production, the newspaper said, with
the number manufactured annually to gradually increase to 100,000 vehicles.
Earlier reports have suggested that Toyota might produce hybrid vehicles at the
Fuji plant.

The Indiana plant produced nearly 120,000 Subaru models last year.

It wasn't immediately clear if Subaru production would be reduced or what the
factory's total vehicle output would be.

Fuji teamed up with Toyota in October after ending a five-year tie-up with GM,
which sold its 20 percent in the Japanese company. Toyota, based in Toyota City
in central Japan, bought an 8.7 percent stake from GM for about $315 million to
become Fuji's top shareholder.

Overall, GM lost almost $4 billion in the first nine months of this year, hit
by falling sales and rising health care costs. Its share of the U.S. market has
shrunk to 26.2 percent from 33 percent a decade ago.

GM's plant closings, which will entail 30,000 job cuts, are meant to chop $7
billion off its $42 billion annual bill for operations by the end of next year,
including a $3 billion cut in health care costs.

Toyota, by contrast, is on pace to set a fourth straight year of record profits.

Both GM and Ford Motor Co., the world's third-biggest automaker, are seeing
their U.S. market share shrink because of Toyota and other Asian competitors.
Toyota, Nissan Motor Co. and Honda Motor Co. all are reporting healthy earnings
bolstered by their reputation for well-built, fuel-efficient cars at a time of
surging gas prices.

GM's tie-up with Fuji was largely deemed a flop. But access to Fuji's plants
could help Toyota boost production at a time of soaring sales, analysts say,
although Fuji has only the one plant in North America, so additional capacity
will be limited.

Completed in 1988, the Indiana factory was built under a joint-venture
agreement between Fuji and Isuzu Motors Ltd. Fuji bought out Isuzu's share in
the venture and became sole operator of the plant in 2003.

After GM's latest cost cuts, the company will be able to build about 4.2
million vehicles a year in North America, down 30 percent from 2002. Toyota is
expected to have North American capacity of about 1.81 million cars by then, up
from 1.44 million vehicles last year, Toyota spokesman Dan Sieger said Monday.

China is one bright spot for GM, which said last month that sales there rose
27.8 percent in the first three quarters of the year to 472,468 vehicles.
Growth was fueled partly by a mini-vehicle joint venture with Shanghai
Automotive Industrial Corp. and Wuling Automotive.

GM and Toyota have a long-standing partnership to share environmental
technology, and they run a car assembly plant in California together, although
the ties do not involve holding stakes in each other.

Out of concern for GM's plight, and possibly to stave off an anti-Japanese
backlash by American consumers, Toyota Chairman Hiroshi Okuda suggested earlier
this year that Toyota should raise the price of car models in the United States
to level the playing field. Toyota raised prices soon after, but denied the
move was to placate U.S. automakers.

[SSLL]

I would like to mention my parents have driven their '94 Taurus to the ground, and it still drives. They also had an '83 Chevy Caprice Classic that only was retired in 2002! I don't really care the make of the car being Japanese, but it's also nicer if they're built in the US or Canada.

[James Bond Agent 007]

edluva-

As I said, here in Washington state, Japanese cars have constituted about half of the cars sold here almost since I first moved here in '88. And yet, the percentage of old (>10 or 15 years) cars I see on the road that are American cars far outnumbers the old Japanese cars I see on the road.

If Japanese cars really did last longer than American ones, and since the Japanese-domestic ratio here has been about 50-50 for at least 15 years, it would stand that I would see more old Japanese cars on the road around here than American ones, because they originally numbered about the same as domestic makes, and they supposedly outlast American cars.

But that's not what I see - what I see on the roads is the opposite of what you would expect to see if Japanese cars really did outlast American makes.

Let me tell you this, I'm a bit surprised to hear my co worker has a 1986 Oldsmobile Cutlass with 500,000 miles on it and still runs, but beginning to fall apart. It's american...don't ask me how it still runs. :-P
This is exactly what I'm talking about - this car is almost 20 years old with 500K miles and it is STILL on the road!

Of course a 20-year-old car with half a million miles on it is going to have some problems!! But at least it's still on the road! I rarely see any 20-year-old Japanese cars on the road at all!

The more I read about these stories of people's old cars, the more I'm beginning to think that this Japanese-cars-last-longer thing is largely an urban myth.

[Last Chance]

I grew up in Mid-Michigan. Not far from Buick City. We always drove GM cars. I flew back there two months ago and rented a car at Detroit Metro airport. There was one Hyundai in the whole lot. It was parked up front with the mid-size cars, and the rep said,"That one has problems, you don't want to rent it."

GM cars are like couches on wheels. When you have roads like Michigan, that freeze and thaw all the time, you need a comfortable ride. A milder climate allows for a stiffer, sportier suspension.

How many people in the Pacific NW like Airbus planes? How many people in St. Louis drink Corona? How many people in Vermont put Aunt Jemima syrup on their waffles? How many Apple computers are there in Austin, TX where Dell and IBM employ over 22,000 people? Don't expect the midwest to have any less regional pride. Their friends and neighbors have jobs there. It still matters in that part of the country - always will.

[SSLL]

December 31, 2005

Poor year is closing for Big 3
U.S. automakers lost market share in 2005
By Sarah Karush
Associated Press
December 31, 2005

DETROIT -- A lackluster December is expected to cap a dismal year for U.S. automakers, who saw Asian competitors eat away at their market share throughout 2005.
Analysts are forecasting a weaker month than December 2004, as the impact of traditional year-end deals was muted by deep discounts during the summer. However, the month's sales are likely to be vastly improved from the autumn slump that followed the end of the summer's promotions.
Automakers are scheduled to report December results on Wednesday.
Full-year sales are expected to be essentially flat, but with market share losses for the Big Three, whose best sellers -- gas-guzzling trucks -- fell out of favor.
General Motors Corp., Ford Motor Co. and DaimlerChrysler AG's Chrysler Group had a combined U.S. year-to-date market share of 57 percent at the end of November, down from 60 percent two years before.
Robert Barry, an analyst with Goldman Sachs, estimated their December market share at 54.5 percent, down from 58.1 percent last year.
Early numbers released mid-month indicated that sales got off to a slow start in December, traditionally a time of brisk sales thanks to year-end deals. U.S. sales were down 14 percent for the first 11 days of the month, according to the Power Information Network, a division of the marketing research and consulting firm J.D. Power and Associates.
Though the pace picked up later, analysts John Murphy, of Merrill Lynch, and David Healy, of Burnham Securities, both predicted December sales would be 5 percent below year-ago levels.
GM, Ford and Chrysler saw sales soar to near-record levels this summer with discounts that let consumers pay the employee price. But sales plummeted as soon as the discounts expired in October.
The automakers returned to incentives at the end of the year, though after the summer's deals they had less effect than in previous years.
Analysts said the biggest change in 2005 was a shift toward cars and away from trucks.
"This shift has been especially prominent in (the) last four months as September's hurricanes and $3/gallon gasoline served as a turning point in consumer preference," Murphy noted, adding that if it continues, the trend could accelerate the market share loss of GM, Ford and Chrysler. The domestic Big Three rely on SUVs and other light trucks for the majority of their sales.

[Nutterbug]

edluva-

As I said, here in Washington state, Japanese cars have constituted about half of the cars sold here almost since I first moved here in '88. And yet, the percentage of old (>10 or 15 years) cars I see on the road that are American cars far outnumbers the old Japanese cars I see on the road.

If Japanese cars really did last longer than American ones, and since the Japanese-domestic ratio here has been about 50-50 for at least 15 years, it would stand that I would see more old Japanese cars on the road around here than American ones, because they originally numbered about the same as domestic makes, and they supposedly outlast American cars.

But that's not what I see - what I see on the roads is the opposite of what you would expect to see if Japanese cars really did outlast American makes.
Could it be that people are more hesistant to replace their big old American cars, because there are no new replacements on the market for them now, whereas with the Japanese cars, they were compact then and they are now, so people feel they might as well do with the newer models?

Also, could it be there's more of an export market for used Japanese cars to foreign, poor countries, since they don't use up as much gas and have the reputation to last?

[James Bond Agent 007]

Could it be that people are more hesistant to replace their big old American cars, because there are no new replacements on the market for them now, whereas with the Japanese cars, they were compact then and they are now, so people feel they might as well do with the newer models?

Also, could it be there's more of an export market for used Japanese cars to foreign, poor countries, since they don't use up as much gas and have the reputation to last?
Not all of the old American cars I see on the road are big ones. I still see a fair number of 80's Cavaliers kicking around, for example. But I *don't* see very many 80's Corollas kicking around.

Don't know anything about the export market for used cars.

[James Bond Agent 007]

BTW, I'm renting a 2006 Nissan Sentra this weekend which had a paltry 1,100 miles on it. I've also rented Ford Focus', Chevy Malibus and a Kia Rio in the past several months.

The automatic transmission on the Rio was just awful - don't even think about going up a hill and retaining your sanity. ;)

The Malibu was nice. Had no complaints about it at all. So was the Focus.

The Sentra I'm now renting is nice, too. However, I really don't sense any qualitative difference between it and, say, the Focus, which is a direct competitor. Some Japanese car-snobs would have you believe that to sit down in a Japanese car would make one cum in their pants from its excellent-ness, and that sitting down in an American car would make it fall apart instantly. Or something like that.

But the Sentra I'm renting now is really no different than the Focus. It's nice, but I don't see anything to get so excited about.

Frankly, of all the cars I've rented recently, the one I liked the best was the Malibu.

[SSLL]

I have seen lots of old late '80s early 90's Japanese cars though, much more than US cars. Civics, Corollas, Camrys, etc.

[James Bond Agent 007]

^
Well, that's not what I see.

That's not to say I don't see any Japanese cars from the 80's and earlier, it's just that the overwhelming majority of the cars from that era I see still on the road are American cars.

[SSLL]

GM surpasses VW to become top-selling foreign automaker in China last year
CHRISTOPHER BODEEN
Thu Jan 5, 1:49 PM ET
SHANGHAI (AP) - General Motors Corp. became China's top-selling foreign automaker last year, surpassing Germany's Volkswagen AG, after seeing its sales grow 35.2 per cent to 665,390 vehicles, according to company figures released Thursday.

South Korea's Hyundai and Japan's Honda also reported strong growth, while Volkswagen, the former market leader, saw its sales decline in 2005.

GM, which is looking to growth in China to make up for its shrinking market share in the U.S., said sales were driven by the continuing popularity of its Buick brand, led by the Excelle sedan and hatchback.

It sold 105,000 of those two models through September, according to the China Auto Industry Association, although GM (NYSE:GM - news) gave no figures for the entire year.

Sales of the Buick GL8 luxury passenger van also recorded steady growth, while newly introduced Chevrolet and Cadillac models also did well.

The sales growth gives GM, the world's largest automaker, about 11.2 per cent of the Chinese market, up from 9.4 per cent in 2003, the company said.

Nearly all GM cars sold in China are made domestically.

The company has opened a second plant in Shanghai last year and added three new Chevrolet models in 2005, the Sail compact car, Epica intermediate sedan and Aveo hatchback. That pushed China sales for the brand past the 100,000 mark for the first time, establishing China as Chevrolet's fourth-largest global market.

"We have no intention of letting up on the accelerator," Kevin Wale, president and managing director of the GM China Group, was quoted as saying in the release.

Volkswagen, which once had more than half of China's car market, said overall sales declined for the second straight year, falling about 15 per cent to 564,306.

Annual sales at its flagship Shanghai joint venture fell 19 per cent to 287,000 vehicles, said a company official speaking on condition of anonymity. Its other joint venture, China Volkswagen Automotive, saw sales edge up just 3.2 per cent to 277,306 units from 268,000 in 2004.

VW has seen its market share drop sharply from over 50 per cent in the 1990s. Hoping to regain lost ground, it has slashed prices and announced plans to introduce up to 12 new models in China by 2009 while cutting costs and improving service.

Hyundai Motor Co., meanwhile, reported annual sales of 233,668 cars produced by its Beijing Hyundai Motor joint venture, up 62 per cent from 2004, spokesman Sun Zhenjie said.

Growth came mostly from its Elantra model, the mainstay of Beijing's taxi fleet and the mainland's second best selling sedan after China's own Xiali.

The Korean company aims to boost production and sales by about 30 per cent in 2006 to 300,000 units, Sun said. Targets call for China production capacity of 600,000 units by 2008.

Japanese carmaker Honda Motor Co. reported a 19.1 per cent rise in sales to 255,500 units in 2005, public relations manager Masaya Nagai said. Production in China last year rose 24.4 per cent to 266,500 units, he said.

The company aims to raise sales 38 per cent this year to 353,000 cars and boost production 41 per cent to 375,000 units, Nagai said.

Meanwhile, GM's flagship joint venture in Shanghai, Shanghai General Motors Corp., sold 325,429 vehicles, up 28.7 per cent from the previous year, the company said in a release.

Minivans and small trucks sold under the Wuling brand - made at the GM's joint venture in southwestern China, SAIC-GM-Wuling Automobile Co. - benefited from strong sales in rural China and cities in the relatively poorer interior, it said. That joint venture sold 337,188 units, up 43.4 per cent from 2004.

New models under the Buick, Chevrolet and Cadillac brands will be introduced this year to keep up with what Wale predicted would be 10 and 15 per cent growth in the Chinese vehicle market.

GM gave no figures for profits in its China operations.

But in July-September quarter, GM earned $176 million US in Asia while losing $1.6 billion in North America. In 2004, GM sold 4.7 million cars and trucks in the U.S. and 4.3 million elsewhere.

[SSLL]

Chevrolet surpasses Ford as No. 1 brand in U.S. sales in 2005
January 4, 2006 - 18:21
By DEE-ANN DURBIN

DETROIT (AP) - Chevrolet was the best-selling brand in the U.S. market in 2005, outpacing Ford for the first time in 19 years, General Motors Corp. said Wednesday. But that was where the good news ended for GM and other U.S. automakers, who continued to lose ground to foreign rivals.

Japanese automakers Toyota Motor Corp. and Nissan Motor Co. and South Korean automaker Hyundai Motor Co. all reported sales increases of nine per cent or more for the year. Toyota, whose U.S. sales were up 10 per cent over 2004, said its Camry sedan was the best-selling car in the United States for the fourth year in a row, while its Lexus nameplate was the best-selling luxury brand.

Meanwhile, 2005 sales fell four per cent at both U.S. industry leaders GM and Ford Motor Co., while DaimlerChrysler AG's Chrysler Group sales rose five per cent.

U.S. automakers also reported disappointing results for December despite a new round of holiday discounts. GM's December sales were down 10 per cent, Ford fell 8.7 per cent and Chrysler was down five per cent as payback from strong summer sales continued.

Asian automakers fared better in December, in part because they didn't offer employee-discounts over the summer. Toyota's December sales were up eight per cent, while Hyundai's were up nearly 16 per cent as customers snapped up the 2006 Sonata. Honda Motor Co.'s December sales were off three per cent while Nissan's were off one per cent.

GM's sales decline for the year included a seven per cent decline in car sales and a two per cent decline in sales of trucks and sport utility vehicles. Although Chevrolet sales slipped slightly from last year to 2.6 million, they outpaced Ford by around 21,000 vehicles thanks to strong pickup sales and enthusiasm for GM's new HHR crossover.

Paul Ballew, GM's executive director of market and industry analysis, said the year-end totals were below the company's expectations. But he said the win for Chevrolet gives the world's largest automaker an important boost. GM lost nearly $4 billion US in the first nine months of 2005 as it struggled with high costs and falling U.S. market share.

"It does confirm our ability to produce industry-leading vehicles," Ballew said.

Ford's sales drop for 2005 reflected lower consumer demand for trucks and sport utility vehicles in the face of high gas prices. Chrysler's rise for the year was due to hot-selling models like the Chrysler 300 sedan and the Town & Country minivan, which both saw sales increase more than 25 per cent for the year.

Japan's Honda reported an increase of five per cent over 2004 sales. Honda's car sales were flat but the automaker's truck and SUV sales rose nearly 14 per cent, largely on the strength of the Honda Pilot small SUV and Honda's new Ridgeline pickup. Honda said it was the company's 12th consecutive year of U.S. sales increases.

It was a tumultuous year for automakers, who enjoyed near-record sales thanks to employee-pricing discounts over the summer but watched large SUV sales plummet when gas prices spiked after hurricane Katrina. Ford's U.S. sales analysis manager George Pipas predicted SUV sales will stabilize in the coming year as long as gas prices remain lower than $3 a gallon.

"This is still a big segment, this is still a popular segment that meets the needs of many consumers," he said. "The wild card is gas prices."

But Pipas also said there is a definite consumer trend away from SUVs in favour of cars and crossovers, which are car-based SUVs. Ford, the second biggest automaker after GM, said 2005 car sales rose five per cent for its Ford, Lincoln and Mercury brands, but truck and SUV sales fell eight per cent. Pipas said it was the first year since 1981 that cars gained market share against trucks.

Ford also said sales of its crossover vehicles rose 28 per cent. The company predicted crossover sales will continue to outpace all other categories through the end of the decade.

Automakers expressed optimism about 2006. Ballew said the economy is expanding just as new vehicles are hitting the pipeline.

"It's not the perfect backdrop because energy prices are higher than people anticipated, but the overall backdrop for this industry is not that poor," Ballew said.

Sales figures were adjusted for the number of sales days. There were 307 sales days in 2005 and 308 sales days in 2004.

GM shares rose 51 cents to close at $19.41 on the New York Stock Exchange while Ford shares rose 18 cents to end at $8.01 and DaimlerChrysler's U.S. shares lost 24 cents to $53.51. Toyota's U.S. shares fell 26 cents to close at $106.59 on the NYSE.

[SSLL]

New Ford executive Mark Fields emphasizes brand's American identity
January 4, 2006 - 18:13
By TIM MOLLOY

LOS ANGELES (AP) - Ford Motor Co.'s new president of the Americas on Wednesday aggressively promoted the brand's U.S. identity and charged that foreign competitors were posturing as American.

"In terms of economic and social influence there is no other company that's had a greater impact on the lives of people in this country and in the 20th century than Ford," Mark Fields said in a speech at the L.A. Auto Show.

Fields said that "many brands want to be American" and he specifically pointed to Toyota Motor Corp. as "desperately trying to cast itself as an American brand."

"Toyota is trying to be American because they realize the market potential is huge," he said.

Fields' comments came as Ford and other U.S. automakers are losing billions of dollars as well as U.S. market share to Toyota and other Asian carmakers. Fields was named president of Ford's Americas division in September and is developing a restructuring plan expected to include plant closings and job cuts that is scheduled to be announced on Jan. 23.

He was formerly executive vice-president of Europe and the Premier Automotive Group, the London-based company that oversees sales, distribution and other services for Ford's high-end brands like Aston Martin, Jaguar and Land Rover.

As he was talking to the audience in Los Angeles, Ford was reporting its sales dropped four per cent in 2005 as consumer demand for trucks and sport utility vehicles fell in the face of high gas prices. General Motors Corp.'s Chevrolet surpassed Ford as the best-selling brand in the U.S. market in 2005 for the first time in 19 years. GM is the biggest U.S. automaker and Ford is second.

Responding to Fields' remarks, Toyota spokesman Mike Michels said, "We view ourselves as the customers' brand, nothing more and nothing less."

Toyota has advertised its manufacturing in the United States "to make sure people are informed about the positive economic impact that we have here," Michels said.

"In the end," he added, "all automakers are international brands."

Fields told the Los Angeles audience the days of the Big Three - GM, Ford and DaimlerChrysler AG's Chrysler Group - were over and have been replaced by a "Big Six" in which everything is up for grabs.

Using such phrases as "red, white and bold" and "bold, American and innovative" to describe Ford's new strategy, he said, "It's time to play offence" to preserve Ford's market share.

Fields said Ford's strategy would include a new emphasis on crossover vehicles that include many of the comforts and conveniences of sport utility vehicles but handle more like cars than trucks and have better fuel economy than SUVs.

Fields described what he said was his company's unique relationship with consumers, saying Ford had most success in the areas where it best knew its customers, including the market for the aggressive 550 horsepower V-8 Ford GT.

"Ford vehicles from the Model T to the Mustang are in our national consciousness," he said.

Art Spinella, president of CNW Marketing Research, a Bandon, Ore., auto research firm, said Field's remarks reflect fears that foreign automakers will break into the full-sized truck market in the mountain states and southeast, where loyalty to American trucks is high.

Ford was particularly threatened by Toyota opening a truck plant in Texas because it could diminish customer loyalty there to American automakers, Spinella said. The company is trying to hold onto its 45 per cent share of the full-size pickup market, he said.

Foreign automakers "don't have a very big slice of large trucks, but once they didn't have a large slice of the car market either," Spinella said.

In his remarks, Fields dismissed the "much talked about new competition" for Ford's F-Series trucks without naming specific competitors.

[SSLL]

Thursday, January 5, 2006
Welcome mat's out for Toyota
No plans for new plant, but Ohio ready anyway

By Mike Boyer
Enquirer staff writer

Toyota says it has no immediate plans to build another North American assembly or engine plant, but Ohio Gov. Bob Taft wants to be ready just in case.

In response to a reporter's question Wednesday, Taft said the state has offered the automaker a free site and annual grants of $2 million for 15 years should it locate in the Buckeye State.

"We are definitely competing aggressively for that project," Taft said Wednesday during a bill-signing ceremony in Columbus for the Jobs for Ohio bond issue.

Victor Vanov, a spokesman for Toyota's North American manufacturing headquarters in Erlanger, said there were no current plans to build new facilities, but that could change if sales stay strong.

And a spokesman for the Ohio Department of Development said the automaker "has no specific expansion plans," but the state and Toyota are constantly talking about potential plant sites, including three in Southwest Ohio.

"The reality is Toyota is a year or more away from making any decision,'' department spokesman Merrel Madrid said.

Michigan, already reeling from planned or impending cuts by General Motors and Ford Motor Co., has been aggressively wooing Toyota, said David Cole, director of the Center for Automotive Research at the University of Michigan.

"Toyota's a smart company,'' he said. "They're particularly concerned about their impact on traditional manufacturers."

While sales by the Big 3 have been declining, Toyota's North American sales have been growing. Toyota said Wednesday that North American auto sales topped 2.26 million units in 2005, up 10 percent from 2004.

But Toyota, which has 11 assembly and parts plants in North America and is building new vehicle plants in San Antonio, Texas, and Woodstock, Ontario, probably isn't looking for additional assembly plants, Cole said.

Toyota's agreement last month with Fuji Heavy Industries to use excess capacity at its Lafayette, Ind., assembly plant eases its need for additional assembly capacity for the near future, Cole said.

Yet Toyota, which will unveil its new hybrid Camry at the Detroit Auto Show Monday, may need additional engine-plant capacity within the next year or two, he said.

Toyota's largest plant outside Japan is the 7,000-employee Georgetown, Ky., factory, which is marking its 20th year and will begin assembling the first hybrid-powered Camry.

Toyota officials have said they are unlikely expand in Kentucky.

They cited the size of their operations already in the commonwealth.

Workforce is key

Toyota typically seeks plant sites of a couple hundred acres with access to rail. But Cole said the most critical element is access to plenty of trainable workers.

"They typically want eight or 10 applicants for every job,'' he said. "And they want to be the highest-paying employer in the area.''

The popular perception is that Toyota and other foreign-owned auto makers seek communities without heavy union activity. But Cole said, "That's not necessarily the case. Their joint venture with General Motors Corp. in California is a plant represented by the United Auto Workers.''

Possible sites include areas in Clinton, Fayette and Preble counties, according to an Oct. 19 letter Taft sent to Seiichi Sudo, president and chief executive officer of Toyota's North American manufacturing headquarters in Erlanger.

Those southwestern Ohio sites are accessible to Toyota's current network of suppliers and offer immediate access to skilled auto workers, Taft said in the letter.

Brown County, east of Cincinnati, is another possibility, said Madrid.

Car makers wanted

Taft personally escorted Hyundai executives to Mount Orab and other sites in Southwest Ohio in 2002, when the South Korean automaker was considering Ohio and Kentucky for an assembly plant that was built outside Montgomery, Ala.

A decade earlier, Mount Orab was briefly considered by Toyota for the pickup truck plant that was subsequently built in Princeton, Ind., near Evansville.

Toyota is operating beyond its current North American plant capacity, with 1.45 million cars and trucks built in the United States through November, up from 1.41 million for all of 2004.

[SSLL]

January 8, 2006
Is There a Future in Ford's Future?
By MICHELINE MAYNARD
DEARBORN, Mich.

MARK FIELDS has no time to waste - and no time to become acquainted with employees at Ford Motor, where he is the new president of its American operations.

That is why Mr. Fields, who recently returned to Ford's headquarters here in October after three promotions that had taken him to Argentina, Japan and England in the last eight years, has been firing off "Dear Team" e-mail messages to employees, outlining the steps that he thinks the company needs to take, and serving as host for internal Webcasts.

Borrowing tips from the business books he devours as late-night reading, Mr. Fields has also written long lists, which he keeps in a binder that sits on a shelf behind his desk, of what he expects from his staff - and what they should expect from him. He displayed them last week in his first interview since his promotion; the lists cover topics like the way he wants to run meetings (no secret BlackBerry surfing, no wall-sitters who do not take part in decision-making) and his personal values (candor, humility and a sense of humor). He wants reports on white paper, and memos delivered ahead of meetings - so that executives know what they will discuss. And he wants managers to wear enameled pins bearing the blue Ford oval insignia.

All of those might seem like the latest executive whims at a company that has been through every management trend to hit the business world in the last 25 years, from Japanese-style quality circles to global development teams. But Mr. Fields has an enormous challenge ahead in fixing the sickest part of Ford - its sprawling operations in the United States - and he does not want employees to spend months figuring him out. The detailed instructions are necessary to speed up his acclimatization, he said, because "they can't read my mind." Indeed. But no one can misread Mr. Fields's challenge.

The difficulty of his task was underscored just last week, when Standard & Poor's cut Ford's credit rating an additional two notches deeper into junk status, moving the company even further away from regaining the top investment grade rating it had used as a competitive tool throughout much of the 1980's and 1990's.

After meeting with Ford officials last month about the turnaround plan that Mr. Fields is drafting, S.& P.'s analysts warned that Ford could also be swamped in the event of a bankruptcy filing by General Motors, which is grappling with its own radical restructuring program. G.M. would be able to cut its labor and other costs under court protection, giving it an advantage.

Further crowding Mr. Fields's plate is the strength of Toyota, which is poised to pass G.M. this year as the world's biggest auto company, and which, at one point last year, came within a hair's breadth of catching Ford to become the second-biggest auto company in the United States market.

When William Clay Ford Jr., the company's chairman and chief executive, was asked what he wants from Mr. Fields, he replied bluntly: "I want him to turn the place around."

JUST five years ago, the talk in Detroit was about whether Ford could eventually outsell G.M. Now the talk is about which of these two companies is worse off.

Dealing with G.M. is particularly treacherous these days for Ford, which is about a third smaller in the United States. G.M. proved again last summer that it was still willing to sacrifice long-term performance for short-term gain, offering consumers the deep discounts it usually reserves for employees.

Ford and Chrysler were forced to match the deals, which caused sales to soar. But sales crashed just as quickly when the offers ended, and the gimmick did little to help G.M. or Ford stave off the threat posed by Toyota. By contrast, Ford found a way in the mid-1980's to confront Toyota, by introducing the Taurus sedan, which initially outsold Toyota's Camry.

"It feels like a lot of obstacles hitting a weakened company when the competition is moving from strength to strength," said John Paul MacDuffie, an associate professor of management at the Wharton School of the University of Pennsylvania.

Today at the North American International Auto Show in Detroit, Mr. Fields will take a big step in trying to reverse that momentum by introducing the first of Ford's next wave of new vehicles aimed at recapturing at least some of its lost sales. They include a crossover vehicle called the Edge - no relation to the U2 guitarist - as well as the MKX, a replacement for the Lincoln Aviator sport utility, and an eye-catching concept car, the Ford Reflex, whose low-slung lines and rear-hinged, flip-up doors are meant to show that Ford believes a small automobile can still be imaginative.

The tougher - but equally crucial - job comes later this month. On Jan. 23, he will give the details of the Way Forward, a name he chose for his turnaround plan at one of his earliest meetings after his arrival in Dearborn. The plan is expected to include plant closings, thousands of job cuts, new brand images for the Ford and Lincoln-Mercury divisions and a renewed effort to streamline the company by paring expenses and eliminating white-collar workers.

"He's got a lot of things to do," Mr. Ford said in an e-mail interview last week. "But I believe he can do them."

The details that Ford executives shared on the plan did not convince S.& P.'s analysts, who issued their downgrade last Thursday, nearly three weeks before Ford officially introduces the program.

While S.& P.'s veteran analyst, Scott Sprinzen, declined to discuss the plan's details, he said that Ford had to overcompensate for anything G.M. might do as it worked out its own strategy for survival. "G.M. is one factor in the marketplace that Ford has to consider in setting its own restructuring plan," Mr. Sprinzen said. According to news reports, G.M. will soon announce extensive price cuts on its cars and trucks. Rick Wagoner, G.M.'s chief executive, declined to comment on the reports.

Many of the elements in the Way Forward were part of Ford's last comeback, deployed in 2002, soon after the company's chairman, Mr. Ford, ousted Jacques Nasser as chief executive and took the job himself. In that turnaround, Ford cut billions of dollars in costs, shut factories and returned to profitability. But its market share in the United States, which Mr. Nasser had once pushed above 25 percent, kept falling as the S.U.V. lineup that Mr. Nasser had championed faded in popularity.

Ford ended 2005 with just 17.4 percent of the American market, its lowest level since the early 1980's. And for the first time since then, Chevrolet beat the Ford division last year as the top-selling brand among Detroit companies. "In some ways, Ford never recovered from the woes of the Jacques Nasser era," Professor MacDuffie said.

Now comes Mr. Fields, who owes Mr. Nasser some of his reputation as a rescue artist, albeit one who has historically been sent someplace else before he could see his plans fully bear fruit. Mr. Fields, a former I.B.M. manager whose first job was selling Selectric typewriters, was running Ford's operation in Argentina when Mr. Nasser phoned in 1998 and convinced him to transfer to Japan to help run Mazda, of which Ford had gained management control.

Four years later, Mr. Fields was on the verge of introducing an entire new lineup of Mazda vehicles when he received another phone call from Dearborn, this one asking him to move to England to run the Premier Automotive Group, the collection of luxury brands including Volvo, Jaguar and Land Rover that Mr. Nasser had assembled in hopes of expanding Ford's profits.

Mr. Fields was still in the midst of a turnaround effort at Jaguar last year, when Ford was hit by a wave of executive departures, including those of seven senior managers who retired or quit. That turbulence resulted in his latest promotion, which sent him back to Ford's home office for the first time in more than a decade.

There, the woman who became his No. 2 executive, Anne L. Stevens, the chief operating officer in the Americas, was already in place. Trained in manufacturing, Ms. Stevens had never before worked with Mr. Fields. But they shared two things: a mentor in James J. Padilla, Ford's president and chief operating officer, who had worked with both in different parts of the world, and a fondness for New York-ese.

Both Mr. Fields, who was born in the Canarsie section of Brooklyn and raised in Paramus, N.J., and Ms. Stevens, a Pennsylvania native who has lived in Manhattan and Hoboken, have the same "you gotta problem with that?" chemistry that allows them to cut through red tape and get to the point. No need for any black binders here: the pair can sit down, "talk fast, have a drink and talk New York," said Ms. Stevens, who was in charge of Ford's operations in Canada, Mexico and Latin America before her own promotion last year. The executives have become inextricably linked with each other; Mr. Ford refers to them in one breath as "Mark-and-Anne" and calls their skills "a great fit."

Mr. Ford wrote in an e-mail message: "In some ways, they're so much alike. They're both tough, but personable. Their skills are very complementary. He's very strong in sales and marketing, and she's strong in manufacturing and product development."

And they have become the latest celebrities in Detroit, a city where senior automotive executives are akin to Hollywood stars.

"Now it's the Mark-and-Anne show," said James P. Womack, the author and expert on manufacturing efficiency, who has studied the company for 25 years.

People are watching closely, to the point where many Ford executives have taken to wearing blue rubber inspirational wristbands like those prominently sported by Mr. Fields and Ms. Stevens.

Recently, The Detroit News breathlessly described Mr. Fields, with his jet-black hair, as "movie star handsome," although his slightly rough-edged demeanor may be best suited to a Martin Scorsese film or an episode of "The Sopranos." ("You don't sound professional when you say 'uh' all the time," one employee said in an anonymous e-mail message to Mr. Fields during a recent company Webcast.)

That's all fine, Mr. Womack said, but given the drain of executive talent and the mounting problems at Ford, Mr. Fields and Ms. Stevens still have to prove that they are more substance than style. "The history of Ford is that nobody is able to make any decisions, and they go down all kinds of irrelevant cul-de-sacs," he said. "Within the next year, an awful lot of this has got to get resolved."

Mr. Fields has to do that with an admittedly skeptical work force. Privately, Ford executives said they were alarmed when a proposal that would make modest cuts in the company's health coverage for blue-collar workers was barely approved in late December by members of the United Automobile Workers union. Last week, three union members said they would demand a recount, although U.A.W. officials have said they stand behind the results.

While Mr. Fields does not have direct responsibility for union relations, he will have to develop relationships with union leaders, including the U.A.W.'s president, Ron Gettelfinger; contract talks loom in 2007.

That is where his time overseas is a drawback, said Brett D. Hozelton, an analyst at KeyBanc Capital Markets and a former financial analyst for Ford. "The U.A.W. is going to look at Mark and say: 'Mark, you're a whiz-bang guy. You may even be a likable guy. But frankly how do I know that if you tell me you're going to close this plant, that will be the last one?' " Mr. Hozelton said.

Mr. Fields, however, said he had had experience with unions elsewhere in the world and did not consider dealing with the U.A.W. a daunting prospect. He added that he had received hundreds of e-mail messages of support for his efforts, although Ford's salaried staff, which was already reduced under Mr. Ford's first turnaround effort, is also seeing its benefits cut.

Mr. Fields acknowledged that Ford's business is "under stress," but both he and Ms. Stevens expressed a resolve to restore Ford's profitability. Details are scant, though determination is not. "There is no 'can't,' " Ms. Stevens said, a touch sternly, when asked last week if the pair had a backup in case the Way Forward did not pan out.

Mr. Fields can take heart from the turnaround at Chrysler, which was the only Detroit company to increase its sales and market share last year. After two waves of job cuts and cost-cutting programs this decade, the comeback at Chrysler has taken wing, largely on the strength of a single car: the eye-catching 300 sedan, which has made the company seem hip again.

"There is a formula that can be very, very effective," said Jeremy P. Anwyl, the chief executive of Edmunds.com, a Web site that offers car-buying advice to consumers. "You have to decide what you are going to be." He said that Ford had good products, notably the new Fusion midsize sedan, but added that they had been ill-served by its lackluster marketing efforts, which have failed to create a clear image for the company or its products.

IN a speech last week, Mr. Fields vowed that that would change. Ford, he said, wants to be known as "red, white and bold," stressing its American heritage and its latest emphasis on innovation. Mr. Fields said that the phrase, which is embossed on the company's blue wristbands, "is not about wrapping ourselves in the American flag." But Ford, he said, cannot escape the fact that Ford, Lincoln and Mercury are American brands - even if the industry in which they were born has inextricably changed.

Like Dieter Zetsche, the former Chrysler chief executive who recently took the helm at its German parent, DaimlerChrysler, Mr. Fields said he believed that the Big Three's years of dominance were over - as were Ford's chances of getting back to one-quarter of the domestic market. "Those days are gone," he said. "We have to act like a smaller company - not necessarily be a smaller company. But we have built up the bureaucracy of a company that once had 25 percent, and we don't any more."

To him, the market is the Big Six - G.M., Ford, DaimlerChrysler, Toyota, Honda and Nissan - and to think otherwise is foolhardy. "This is not a cyclical change," he said of G.M.'s and Ford's decline. "This is a secular change."

And Mr. Fields does not expect it to be easy. On one of the sheets in his black binder is a definition of "what a turnaround feels like." The sensation, Mr. Fields told his managers, is "uncomfortable and exhilarating at the same time."

Depending on whether the Way Forward actually is a way forward, Mr. Fields may end up wondering when the second part of that description begins.

[Last Chance]

Well, it sure was nice to see the new Camaro and Challenger at the Detroit auto show. I'm not trading in my truck for the Camaro, but it's nice to see some style come back to GM.

[SSLL]

Foreign Carmakers in the Passing Lane as GM, Ford Sputter
By Sholnn Freeman
Washington Post Staff Writer
Saturday, January 14, 2006; A01

DETROIT -- While the two largest U.S. automakers are in a painful fight for their financial well-being, surging foreign rivals are dealing with more refined issues.

This week at the North American International Auto Show, Japanese auto giant Toyota Motor Corp. rolled out a Camry with seat fabric coated with moisturizer gleaned from silkworms and an air-conditioning system that removes odors and bacteria.

Toyota's luxury Lexus line showcases a new LS sedan that parallel-parks almost entirely on its own. There are a back massager, a leg rest and reclining seats in the back. The LS will be the first car in the industry with a gas-electric-hybrid-powered V-8 engine, a technological breakthrough designed to merge horsepower with fuel efficiency. Both Toyota models are due this year.

Toyota and other foreign automakers are using the auto show, the biggest annual U.S. display of products, buzz and insight into the mind of the globe's automakers, to capitalize on Detroit's weaknesses. As big U.S. automakers grapple with union contracts, the bankruptcy of a major parts supplier and shareholder unrest, Toyota is rolling out new models and new technology in a bid to knock General Motors Corp. from its 75-year perch as the world's No. 1 automaker, perhaps as soon as this year.

The prospects of such a realignment have energized the auto world and given new momentum to competitors from South Korea, Europe and China. It promises to feed another round of sticker wars, with automakers offerings rebates and price cuts to win over fickle customers.

All told, the world's automakers will introduce 27 redesigned and 23 new models in the coming year, according to J.D. Power and Associates. "The world is converging," said Michael Robinet, vice president of vehicle forecasting at CSM Worldwide, an auto industry research firm. "Trade is becoming freer, no matter how many trade hawks are on the horizon. We are down the road to freer trade, and it will not end. The quicker countries and governments accept this, the better off they will be."

The fierce competition comes as the top two U.S. automakers, GM and Ford Motor Corp., struggle to put 2005 in the rearview mirror.

Later this month, Ford will release its restructuring plan, expected to contain tens of thousands of job cuts and other draconian cost-slashing measures. GM lost nearly $4 billion in its North American operations in the first nine months of 2005. The company is laying off 30,000 workers, shutting down or scaling back at 12 plants and scrambling to cut billions of dollars in overhead costs. But even that isn't enough for some. Billionaire Kirk Kerkorian, who owns 7.8 percent of GM's shares, is demanding that the company move into "crisis mode" and pare back operations even further, suggesting that GM sell off its Hummer and Saab brands.

Under questioning by analysts in Detroit yesterday, GM chief executive G. Richard Wagoner Jr. said the automaker could not forecast when its North American operations will again be profitable.

Wagoner said GM is on track to cut $6 billion in costs by the end of this year, but he added that the company's outlook remains clouded by a number of uncertainties. At the top of the list is parts supplier Delphi Corp., which is under bankruptcy protection and seeking relief from GM, its former parent, as well as concessions in pay and benefits from the United Auto Workers. "For 2006, our focus is very clear: The absolute top priority for me and the entire GM team is to turn around the North American business," Wagoner said.

GM and Ford are seeking help from Washington. Ford wants tax cuts and subsidies for the industry so U.S. companies can catch up with Toyota's lead in technology. GM says the industry needs relief from health care expenses, pension bills and other "legacy" costs that are a result of promises made to workers when GM had more than 50 percent of U.S. market share. By 2005, that share had dropped to 26 percent.

DaimlerChrysler AG's U.S. division has been alone among the Detroit automakers in holding its ground. Chrysler has already been through a wrenching overhaul at the hands of its German parents. The automaker's U.S. share grew slightly last year, and it had a lively show in Detroit with a number of new vehicle showings, including a Chrysler Imperial that looks like it borrowed more than a little from a Rolls-Royce Phantom.

As if Detroit didn't have its hands full with operational problems and rivals from Japan and Korea, analysts see a second wave of Asian automakers storming the U.S. market in the future, perhaps including an entrant from India or China. This year, Geely Automobile Co. became the first Chinese automaker to exhibit at the Detroit auto show, displaying a snappy little sedan. The automaker says it plans to enter the U.S. market in two years, though it faces significant distribution and regulatory hurdles.

Automakers from around the world are taking a page from Toyota's playbook, fueling their charge into the U.S. market with vehicles built at U.S. factories. In recent years, auto plants have been popping up in Southern states, including a Hyundai Motor Co. plant in Alabama and a Nissan Motor Co. plant in Mississippi. Toyota is finishing a new factory in Texas that will pump out thousands of pickup trucks this year. The world's automakers are increasingly looking beyond Detroit as competition heats up. For example, Robert F. Cosmai, Hyundai's U.S. president, mentioned Lexus and BMW sport-utility vehicles as chief competitors to the Hyundai Santa Fe, failing to name a single American rival.

Then there is the latest vehicle from Hyundai.

"The scariest picture in town is the Hyundai Sonata," said Sean P. McAlinden, chief economist at the Center for Automotive Research, a nonprofit auto industry watcher. "It's the best value in the automotive market. It has everything that a Honda Accord and a Toyota Camry has, and it's built in Alabama."

McAlinden called the Sonata "an embarrassment to Detroit." "Why haven't we done that in the last 30 years when they've done it in four?" he said.

McAlinden says he expects U.S. sales to grow to 20 million by the end of the decade, up from 17 million last year. He expects market share for Detroit automakers to slip to 50 percent, from 56 percent today. "Maybe we ain't that big no more," he said. "It's hard for us to swallow around here, even for me."

The American automakers play down such gloom and doom and say they are not cowed by the competition. GM, Ford and Chrysler all rolled out rosters of new models this year. And in some cases, they hope to find a bit of their future in their past, when Detroit was king.

GM showed a futuristic version of the Chevrolet Camaro, its classic pavement burner. Chrysler wheeled out a Dodge Challenger concept, its design paying homage to the venerated early 1970s model. Ford promised more iterations of the made-over Mustang that went on sale last year and proved popular. With the throwback designs, U.S. automakers say they are trying to reignite passion and interest in the car brands that they hope could translate to other cars in their lineups.

At the auto show, GM's Wagoner vowed that his company will continue to parry with new vehicles. He said GM officials recognize that they can't fix the business by solely by cutting costs and closing plants.

"We're going to keep bringing out new cars and trucks. We've got to do that for success," Wagoner said. "We are in the very early stages of the soccer game. A lot of time is left and we're going to be ready to play."

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Tuesday January 17, 06:37 PM
Toyota has no plans to overtake GM in volume: exec

DEARBORN, United States (AFP) - Japanese automaker Toyota Motor Company has no intention of overtaking its US rival General Motors in terms of global sales volume, a senior executive said.
"We're not interested in seeing GM declining," said Jim Press, President and Chief Operating Officer of Toyota Motor Sales USA. "We have no intent on being number one. We don't think it is going to happen."

Toyota recently announced plans to build 9.06 million vehicles in 2006, a move which prompted many analysts to speculate that it was vying for the position of the world's largest automaker.

GM, which posted multibillion dollar losses following a sharp drop in sales in the US market, has vowed to reverse its declining market share at home. The Detroit-based automaker recently reported global vehicle sales totaling nearly 9.2 million during 2005.

Speaking at an auto industry trade conference in a suburb of Detroit, Press said if Toyota Motor Co. decides it needs to add engine capacity in the United States, Michigan would be considered as a potential location for the facility.

He said the Japanese automaker would make a decision "in the short-term" as to whether it needs to add engine capacity in the United States.

The added capacity would be needed to feed two Toyota plants under construction in the United States and Canada.

The automaker will open its San Antonio, Texas, truck plant in the fourth quarter, capping an 800 million dollar investment plan.

Additionally, Toyota is investing 800 million Canadian dollars in a manufacturing plant in Woodstock, Ontario, Canada, which will begin assembling the RAV-4 sport-utility vehicle in 2008.

"We need to have engine (capacity) very close to our plants. There is no reason why we wouldn't consider Michigan," Press said, adding Toyota's Woodstock plant would be within close proximity to Michigan, if the automaker chose the state for an engine manufacturing plant.

Earlier Monday, Toyota said it had produced a record 1,558,828 vehicles at its North American manufacturing facilities in 2005.

GM has yet to announce production figures for 2005.

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Patriotism doesn't sell cars today

By Rick Popely and Deborah Horan
Tribune staff reporters
Published January 24, 2006

When domestic automakers had their backs to the wall 25 years ago, they could count on a "Buy American" sentiment to keep some customers from defecting to fuel-efficient foreign cars.

Today, many loyal domestic vehicle owners say they would be comfortable buying an import.

Chuck Sonne, a Country Club Hills electrician, drives a 1997 Chevrolet pick-up and has owned two Fords in the past, but asked if he would only buy an American vehicle in the future, Sonne said, "No, whatever runs better and is cheaper."

As Ford, which announced a massive restructuring Monday, tries along with struggling GM to regain market share in the U.S., it faces an uphill climb. Asian rivals, such as Honda, Toyota and Hyundai are luring buyers with a relentless supply of new and compelling models.

But while the competition has intensified, the comforting old idea for Ford and GM that Americans will make patriotic purchases carries less and less weight.

For one thing, it isn't even clear anymore what "Buy American" means when it comes to cars and trucks. Many of those new models from Toyota and others are built in places like Kentucky, Indiana and Alabama, while the Chevrolet Aveo is imported from South Korea. Meanwhile, some Dodge Ram pick-ups are built in Mexico. Dodge, of course, is a domestic brand, but it's owned by Germany-based DaimlerChrysler.

This blurring of vehicle origin means that Ford or GM can't rely on a "Buy American" marketing campaign.

Art Spinella, president of CNW Marketing Research, says the confusion over national origin means consumers are less likely to try to help fellow Americans by buying a domestic vehicle.

"Basically, they throw their hands in the air and just buy what they like," Spinella said.

Different world

The lack of stigma attached to buying a forei