Domestic Automakers: Do They Deserve Your Pity?
I received a forwarded email last week that I've been thinking about ever since, and I figured I could turn it into an entry here and get your take on the situation. For me, email forwards go directly in the circular file, with one chance to get my attention along the way: I open the message to confirm that it really is spammy and not just a poorly written subject line. There, you've got less than a second to get my attention — and animaged graphics and neon blue text on a bright pink background is not the way to get it.
This one caught my eye though. I did have to reduce my browser's text size to shrink the text into a readable state, but that's a small price to pay. I guess this one got my attention by being about a subject that I find interesting: the economic stimulus plan and the demise of several huge American-owned and -operated companies.
I'll give you the short version, with my paraphrasing:
The government should bail out American car companies (and we should buy domestic cars) because they are more patriotic or more sympathetic to American tragedies than foreign companies.
The email says that Ford, Chrysler, and GM made huge monetary contributions to the Red Cross and various relief efforts after the 9/11 attacks, and claims that BMW, Daewoo, Fiat, Honda, Isuzu, Mitsubishi, Nissan, Porsche, Subaru, Suzuki, and Toyota made no contributions or even expressions of condolence, despite posting record sales numbers in some cases.
Now, let's set aside the fact that no source was given for any of these numbers. For the sake of argument, let's assume the numbers are as close to correct and factual as they need to be.
Who cares?
Perhaps the reason has nothing to do with their feelings toward Americans or for any political reason at all. Perhaps they just can't afford it. Perhaps they just prefer to stay neutral. When the Tsunami killed tons of people in 2004, I was working at Perdue and we organized a campaign to collect donations and get corporate matching, and gave that to relief efforts. This leads me to believe that Americans are just more likely to give when others are in need. (I don't know how much relief effort there was for Tsunami victims from other world-regions, this is just given as a small example of typical American behavior.)
The big thing for me, though, is the fact that this email neglects to mention is that American car companies are suffering from their own negligence. Car companies have claimed for years to be working on alternative-energy powered cars, and in some cases even introduced and later destroyed them, no doubt in part due to pressure from oil companies (that opinion is based on what I saw in Who Killed the Electric Car?). As long as Americans are buying petroleum-powered cars, the oil companies are making ridiculous profits, and in turn spending some of that money convincing manufacturers to continue building the cars.
The automotive industry, in some small way, is mirroring what's happening to the journalism industry. Newspapers and the nightly news are falling out of favor with the younger generations, making way for the likes of The Huffington Post, Fark, and so on. I, myself, have said that I consider The Daily Show to be one of my primary sources of news — and it's true. Katie Couric was on The Daily Show the other night and admitted that the average age of her viewers is 62! I would bet that she has one of the younger demographics of the evening news shows, too.
Despite an obvious downturn in their market share, newspapers and TV news networks are clawing the ground, trying everything they can do not to be dragged away and thrown on the trash heap. They are a dying breed, and instead of trying to adapt their industry and their offering to be what the new generations want, they are attempting to convince the new generations that they want the old thing, or that the old thing still has more value. We'll see how that works for them. What they don't realize is that consumers are getting smarter all the time, and are always looking for the next big shiny thing. And when you find the next big shiny thing? You leave the last big thing — now small and tarnished — behind.
In my mind, the parallels between these industries need no explanation; but I'll explain here for your benefit. Think back to last summer. Gas prices were the Swine Flu of '08. If you weren't talking about them, you were yesterday's news. In my area, gas reached the — admittedly humble in comparison to some other places — price of nearly $4 per gallon at their worst. And still, what were the predominant commercials on TV? Think Hard.
I'll tell you: Employee pricing. "That's right, now you can get a Hummer H3 for the same astronomical rate we charge our own employees! What do we care how much it costs to drive the thing? We're selling you the car, not the gas!" This was during the popularization of the Toyota Prius, and now both Mitsubishi and the relatively unknown player BYD are introducing plug-in hybrid cars that will be available in 2010 in Japan (no official word on plans for U.S. sales yet) and 2011 in the U.S. respectively. And that's just from a 60 second google search. I would bet there are more on the way.
What has the biggest domestic automaker resposne to the popularization of hybrid cars been? A hybrid Cadillac Escalade. So that now maybe it will approach 20mpg (from its current paltry 10mpg)… something gas powered Hondas and Toyotas have been crushing for a decade. At this rate, you're pretty much just paying extra for a nice little "Hybrid" emblem… if you really cared about the environment, you wouldn't drive an Escalade at all.
In the interest of full disclosure, I drive a Ford pickup truck and Megan drives a Toyota sedan. There's no arguing the versatility of a pickup truck. Everybody knows someone with a truck — because you have to, if you ever want to move or transport stuff. As a matter of fact, I'm supposed to help someone pick up an apple tree pretty soon. I don't like driving a gas guzzler, but I do need a truck. It's been perfect for camping and carting our canoe around… if only it were a little greener. Just like my iPhone conundrum, when hybrids and pickup trucks are combined and road tested, I'll be first in line to get one. In the meantime, we drive my truck as little as possible — trying to get the most out of it that we can, when we have to — and try to take Megans car instead, whenever possible.
So back to the email. Should domestic automakers get your money because they donated to 9/11 relief funds? Hell no — at least, that's my opinion. I'll buy the best product that suits my needs. As long as they keep pushing gas powered cars down our throats and making empty promises about alternative energy cars, I'll keep thinking they're getting what they deserve. What do you think?
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