Sunday, November 16, 2008

Why Everyone Hates Us

This morning in The Detroit Free Press I found an article that is definitely in tune with many of my feelings. Saying "I found" the article is a bit of a false statement because the article is in the center of the front page, but I did technically look at the newspaper, which means that I found it. Actually, the newspaper was sitting ready for me at my place at the kitchen table, so I didn't even find the newspaper. I just sat down and there was the article. I'm like Indiana Jones.

This article, written by Susan Tompor reflects on her sadness and anger by how much of the country, particularly the media, seems to truly hate the automobile manufacturers/Detroit. They could not be happier if the U.S. automobile industry dies and they are enthusiastic to support their cause on television, radio or anywhere else. She also points out, as I have, that many of these commentators are clearly out of touch with reality and are forming opinions based on what they heard the guy next to them say. For example, someone on TV claimed that Toyota doesn't build large trucks - clearly ignoring the Toyota Tundra (advertised as Biggest and Baddest), or the Toyota Land Cruiser, which does its part to try to put the Hummer to shame.

Across the board, I almost entirely agree with Susan's sadness and anger regarding the national view of Detroit. It is terribly upsetting, particularly if you care about Michigan. The most difficult part of this whole situation is that so many of these hostile opinions are based on mis-or-partial information. And yet, despite my broad agreement with her, I understand why people hate us so very much. One doesn't have to look much farther than this article written yesterday. On a conference call yesterday morning, Ron Gettlefinger, president of the UAW, declared that the UAW would make no concessions in its current contract. Even with this statement, he urged the U.S. to fork over bazillions of dollars to keep the domestic industry afloat and that the problem was, more or less, entirely out of our hands.

I can not imagine a dumber thing that anyone could say two days before Congress considers keeping the UAW and the domestic automobile manufacturers in business by sending them cash. When one enters into a bargaining or compromise phase, there has to at least be some semblance of openness to actual bargaining or compromise. If one's starting position is that "I will not compromise", then the challenging party or individual will not be inclined to provide what it is for which you are hoping. Even if you do not plan to concede on anything, you still come to the bargaining table with the message that you are open to discussion. We are not in an advantageous position with any sort of leverage - the UAW can not threaten a strike if Congress is not kind enough to provide assistance.

Most people hate us because they think that the UAW, whether true or not, is largely responsible for the uncompetitive predicament of the U.S. auto companies. There is a rallying cry around the country that the Big 3 should go bankrupt because it will finally free them of their entangling and damaging union contracts and the UAW will be forced to disassemble. I am not trying to say that the union should or should not do anything in particular with respect to this week's upcoming discussions, but I am very frustrated that Ron has decided to take this hard line approach before conversations have even begun. This is yet more ammunition that people everywhere will use in arguing that Detroit is uncompetitive, closed to change, pigheaded, not progressive, and generally undeserving of financial assistance. The saddest thing of all is that with statements like this from Ron Gettlefinger, I can more and more understand and appreciate their point of view.


Zward said...

Couple things I was thinking... I think there are a lot of people who realize Detroit has now caught up to Honda/Toyota in many respects, but I was under the impression that the only cars Detroit ever makes that are profitable are the big SUV's and whatnot. To sell the Focus and be competitive w/ similar foreign cars, Ford cannot sell it at a profit? I saw something saying (including benefits) the average UAW worker makes something a little over $100 per hour, while the same Toyota worker in Arkansas makes around $35. How can the Big 3 compete w/ such huge fixed cost barriers??? If they are going to bail these guys out, I think they might as well really nationalize these companies and create a sort of Manhattan project for cars. Force them to develop some wonder-car 100+ mpg electric or super-hybrid. I think you could market it to gain public support, keep some people employed, and still allow for creative destruction that capitalism needs to progress.

Aunt Cathie said...