Cause and effect?

General Motors’ announcement yesterday sent shock waves through the domestic auto industry, but seems to elicit yawns from the rest of us. The reason? The General’s been on life support for decades, unable to compete in quality or in true cost, with a host of (mostly) Asian competitors. And why is this so? A goodly part of the answer may be found in the story in today’s Washington Post:

Already, GM’s troubles are being blamed for threatening to unravel the American industrial dream of a comfortable, middle-class standard of living for factory workers. In the auto industry, after years of struggles, the union workers’ package includes a $28-per-hour salary, top-tier health care, vested retirement pensions and other enviable benefits.

Well, yes, those dreams will unravel if they were not based on economic reality. The actual cost-per-hour is likely well over $60 when one includes all those benefits. And what did we get for such costly-to-produce cars? Anyone who has bought an American car should be familiar with the word “recall.” And “surface defects.” And to such buyers, the most familiar member of the automotive citrus family, Citrus Limonum Generalus Locomotimus.

The plain and ugly truth is that General Motors has been turning out mediocre cars at best. For decades, resting, as it were, on its laurels from the old days when we had limited choices. I used to be a loyal Chevy and Pontiac guy. Lots of problems, lots of care and feeding. And I didn’t ever get what might be called a lemon. Just that they were, in hindsight, mediocre cars. At best.

I found out the difference in 1980, when I bought my first Honda. When the dealer drove it out front, I couldn’t tell if the engine was running, it was so quiet. An Accord, it had a standard transmission, no air conditioning, and got over 30 mpg. Didn’t cost much, and never, ever, had one single defect or problem. Not one.

Eleven years later, I sold it, still in great condition, to an Army captain rotating in as I was rotating out. For about one-third of what I paid for it when new. We both got good deals. My next Hondas were all the same as regards quality. Perfect. Likewise the Honda Civic I bought for my daughter. Likewise the Subaru we bought three years ago. My experience is not unique; it appears to be typical.

Yes, yes, I know. There are lemons in every make. It’s just that the General has not kept pace with the quality of their cars. Partly because of greedy unions, and, perhaps, partly because of inferior workmanship and a philosophy of quality control rather than quality assurance. The first being, roughly, checking for defects after the car is built. The second being, roughly, building quality in in the first place.

The General is teachable, as the quality and reliability of its cars appears to be rising over the past ten years or so. But now they still have that legacy to pay for. There are lessons, and, hopefully, the unions are going to get past their typical “gimme gimme gimme” approach to collective bargaining. Perhaps. And pigs might fly.


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