Mr. Scribbler is correct. GM cannot survive if it is not a global company. Right now the fastest growing markets are China (now the world’s biggest market for cars in terms of units), India and Latin America.

I want GM to survive and pay back the money to the taxpayers. That means GM has to compete globally. GM is very well positioned in China and Latin America and is just bringing a new plant online in India.

As far as Opel is concerned, it’s questionable if GM could afford to lose Opel to the consortium of parts vendor Magna, a Russian bank, Sberbank, and a Russian automaker GAZ. The problem is that right now a number of important GM products including the Chevy Malibu, Buick LaCrosse and upcoming Regal, and others share technology and platforms with Opel products. The new Buick Regal will be a revised Opel Insignia and until the Oshawa plant is set up to make it, the Regal will be sourced for a year or so from Europe.

If the proposed deal to sell Opel had gone through, GM would have had both intellectual property and business nightmares as they would find themselves competing with their own technology and designs.

While investing US taxpayers’ money into overseas operations may not be politically popular, it’s the right business decision and in the best interests of paying back the taxpayers.

I’m not happy with how the Obama administration has handled the domestic automakers. Actually, though, I blame Sen. Richard Shelby who killed a deal that would have provided congressional oversight on any bailout of GM & Chrysler. Shelby was so busy protecting the interests of Mercedes, Hyundai, Toyota and Honda that have plants in Alabama, that he undercut Bob Corker who was close to a deal with management and labor. Shelby wanted a few more pounds of flesh from Detroit and instead ended up with the UAW owning a good chunk of GM and Chrysler and much of the rest de facto nationalized. Big Dick Shelby indeed.

One reason why Alan Mullaly has been successful at Ford has been the “One Ford” idea – leveraging all of Ford’s global resources. It just doesn’t make sense to design and engineer completely different cars for different markets.

GM is trying to do the same with their offshore operations, including Daewoo in Korea and Opel in Europe. Those offshore operations are particularly integrated at the design level into GM’s overall operations.

Not investing in overseas operations would be more like cutting off one’s nose to spite one’s face than some kind of surgical amputation to save a patient from gangrene.

rokemronnie on November 16, 2009 at 7:24 PM

For the record, nobody builds cars the same way they did 20 years ago. Every car company selling product in North America is capable of building a quality and reliable car and the differences between the best (Honda, Ford, Toyota) and the others is statistically significant but not huge.

In the late 1970s and the 1980s, cars were really crappy. They didn’t run well (because of Federally mandated pollution requirements that were very challenging for the then available technology), they were ugly, and they were not particularly reliable. I include Japanese cars too. While they had bulletproof engines (particularly Honda), they rusted terribly (outside of Southern California), couldn’t build a decent automatic transmission and the cars’ heaters hardly worked (the reason why American cars are the world’s standard for HVAC is that Detroit has a huge temperature swing from below zero to above 100 degrees).

True, the domestic manufacturers sold millions of bad cars 20-30 years ago and pissed off a lot of consumers, but it’s just plain stupid to ignore contemporary good products just because the company made crap 3 decades ago. Nobody boycotts Sears because their mom didn’t like her vacuum cleaner when they were a kid.

In terms of vehicle quality and features, there’s no reason why someone shopping for a midsize family sedan shouldn’t look at the Chevy Malibu (which has the best interior in the segment) and Ford Fusion (best mileage and best performance and handling in the class). Even automotive writers critical of Detroit say those are at least competitive with the Camry, Accord, Altima and Sonata. The same can be said about the Cadillac CTS in its segment.

So Detroit is building some world class product right now. And the Japanese aren’t miracle workers. Toyota and Nissan have both tried to crack the fullsize pickup market and still haven’t come up with products as good as the F-150, Silverado/Sierra and Ram. Honda’s new Insight hybrid has been panned by reviewers. Toyota’s recent recall over unintended acceleration is only the most recent blot on what had earlier been a spotless record. Google [Toyota engine sludge] or [Honda automatic transmission] and you’ll see that GM, Ford & Chrsyler are not the only ones who occasionally screw up. I say that as someone who holds Honda in great esteem and I admire many things about the way Toyota designs,builds and markets cars.

Bottom line is the bottom line. If you want GM & Chrysler to be able to pay back the taxpayers, you want them to be able to sell folks cars.

rokemronnie on November 16, 2009 at 7:41 PM