Monday, January 05, 2009

Pt. yon

Continuing the interview questions: from SJ: 3. Why do you think American automakers are doing so bad even as their Asian counterparts are doing great or at least OK?

Some of that has to do with perception over reality. A recent news report said Honda has been outsourcing more and more of its work, had withdrawn from some racing events, and the CEO is now talking about moving the business out of Japan entirely if the yen stays weak. Also, I read a Japanese news report claiming that Toyota had enjoyed nearly three decades of growth, but then suddenly (and conveniently) experienced a 70% loss in one quarter just after the economic woes and auto industry bailout was announced in America. Riiiight.

However, despite the Japanese tendency to gloss over the truth and blame their woes on America, and despite their media being more than willing to play along, the problems with the American auto makers seem to be rooted in the greed and corruption of their corporate leaders. The United States is still the single biggest auto market in the world, and last year the top two best selling vehicles were (as usual) from Ford and Chevrolet, so despite claims that say the Asian vehicles are better made, they do not outsell their opponents here. Plus which, decreased reliability means more money for the automakers in the form of repairs and part sales, so the problem is not the economy or a lack of revenue. That leads me to believe the problem is due to fiduciary misconduct by management mixed with a greedy ploy to snare some money. “Hey – the government is handing out free money. Let’s claim we are just about to go under and get some of that!”

Side note – many Americans believe (as we are taught to believe) that capitalism is superior to socialism. This does not strike me as capitalism, though – it’s more like socialism skewed to benefit the rich. In my limited and uncaring view of world politics, socialism is when you pay the government to take care of your needs and capitalism is when things are based on what the market will bear. In a capitalist society, big business have the freedom to fail if mismanaged. We need a new label to describe this system where the market supports business in good times and during recessions the people pay taxes to the government to bail out the rich and allow them to continue running things into the ground. Any suggestions? How does ShartyDoomism sound? Sorry, but my mind is still being affected by the memory of antibiotics.


NYD said...

Hey Grant, here's a present: My kinda gal

And by the way it's the strong Yen that's making life tough for manufacturers. When the yen is weak we sell tons of shit to you Yankees.

I wonder where you get your info. The newspapers I read differ in many ways. While you are correct in saying that Honda has (Subaru as well)withdrawn from the racing circuit. The facts on Toyota seem skewed. They reported that this was the first time in 70 years that they are not making a profit and that production will have to be cut 70%.

Paul Maurice Martin said...

It seems to me that when either socialism or capitalism become rigid, inflexible ideologies, it's because people in power have figured out how to make that work for them.

What really benefits "the people" is a pragmatic approach that has aspects of both - kind of like the US used to be prior to Reagan. It's been escalating deregulation and "trickle down economics" ever since.

Enemy of the Republic said...

Sheer exploitation. Could that qualify as a name?

Monogram Queen said...

Ya know i'm becoming more and more intrigued with the idea of Socialism.

Grant said...

nyd - I get most of my J-news from MDN and DY. MDN reported the bit about Honda and Toyota. I'm not surprised to see a discrepancy because I see them all the time when I scan for J-news, but I still find it rather suspect that Toyota claims to have done well for decades and then suddenly is facing a massive loss immediately after the economic crisis in America became front page news.

pmm - I think any ideology can be taken to an extreme where it's no longer useful. We need more balance.

eotr - that one might be hard to copyright.

mq - I am too. I'll write more about it later.

SJ said...

The data on car sales in US is mixed. Toyota sells more hybrids than all others put together. They don't sell the most cars per se. The second spot among hybrids keeps changing hands from Ford, GM and Honda.

Another point is most so called Japanese cars are mad in plants in the US usually the South. I would say they are all American cars.

Grant said...

sj - the small J-cars are usually made in Japan, but larger ones and all the trucks are made in America. Studies seem to indicate they are no more reliable than American autos built in America. I don't the the Japanese have better designs, but I think their workers identify themselves more by their jobs and tend to do better work. Most American workers are motivated to work just hard enough to avoid being fired.