In late 2005 I was a car enthusiast working for a car company. What I hoped would be a dream job turned into a nightmare of sorrows as I found that my passion and enthusiasm for cars only served to make me aware of the abyss into which we were falling, without any power or ability to do anything about it. Reading about all the issues in Detroit makes me sad for my friends and colleagues there, and I feel the need to write down a few thoughts, so I will.
I think that Ford is by far the best off of the car companies, in no small part because of their outstanding worldwide product development organizations. My view from the inside was that north american PD was focused on trucks and were very weak in the passenger car area. It seems to me the main reason why euro platforms like C1 and the new mondeo didn’t come to the US was politics- Bill Ford was reluctant to have dearborn take a back seat to europe in terms of passenger cars.
From my outsider’s perspective, Mullally strikes me as a solid leader who isn’t afraid to make tough decisions. The next generation euro focus is coming to the states, as is the Fiesta. I would not be surprised to see clean TDCi technology come to the states as a viable and cost effective alternative to hybrids. The only problem is that now that gas prices are low and dropping even further, making a business case for efficient cars is a risky proposition right now.
There are lots of reasons for cutting fuel consumption, global warming being one of the big ones. However, supply isn’t one of them. Supply is tightly controlled by a cartel of oil producers, and conservative estimates show that we have decades if not a century of oil remaining. That’s a lot of time for pricing fluctuations to affect demand for fuel sipping cars.
So while Washington wants the automakers to make more efficient cars, demand for them will always be very tightly pegged to the cost of fuel. So there are tough decisions for automakers to make.
As for union labor- I’m not anti-union by any means but my time at Ford left me with the impression that the UAW is comprised largely of honest, hardworking folks whose biggest enemy are the people within their ranks who abuse their benefits.
I’m talking about the people who take sick time instead of leave to go deer hunting (thus mandating a company holiday invented to address the rampant absenteeism on the first day of hunting season), or the people who belabor our health care system because of their generous that causes them to go to a doctor for a cold rather than a Walgreens for some nyquil, or an 80 year old retiree who undergoes a risky and expensive shoulder operation against the advice of her doctor because her plan paid for 100% of it.
As a salaried worker at Ford, our general feeling towards the UAW was one of helplessness as we went through endless training on how not to offend a plant worker who was earning an equal or higher wage, even when ‘laid off’. In certain cases, we could not carry our laptops across a plant floor because of union rules around the transport of computer equipment. On the other side, factory workers viewed all ‘blue badge’ (salaried) employees as ‘management’ who was out to get them.
So there was some poison and vitriol there, but I don’t view the UAW as the source of the automakers’ problems. The problem really is that Detroit can no longer attract the most talented minds because Detroit is not a meritocracy. Managers at Ford (and I imagine the same at GM and Chrysler) are there because of loyalty and politics. Employees aren’t encouraged to interact with anyone more than 1 level above them, so the people at the top have a very filtered and manipulated view of the state of the union. It’s not a good environment for a young new employee, regardless of how ambitious and talented they might be.
The road ahead is going to be a tough one for the auto industry. I only hope that they can weather this storm and make the cultural and operational changes to thrive and once again attract the best and brightest minds to Detroit.