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Out In the Cold

The funny thing about this industry is that most of the people who buy its products aren’t that passionate about them.

The funny thing about this industry is that most of the people who buy its products aren’t that passionate about them. To these folks, there isn’t much to choose between a car and a refrigerator. This has prompted some to question the need to have “car people” in places of power within the car companies. After all, if all people want is good, reliable transportation, then any Harvard-educated bureaucrat–and this industry has more than its fair share–should be able to crunch the numbers and make certain everything is in place for solid, substantial growth.

Certainly this was the prevailing thought within the industry as the 1950s came to a close, and as the 1960s progressed. And by the mid-1970s it had taken hold and nearly strangled the American OEMs. Most of the 1980s were spent trying to right the ship without first fixing the leak, while the 1990s saw the rise of the light truck put American automakers in the right place at the right time to reap a bonanza they basically stumbled upon. Is it any wonder that the intervening years have been filled with more entries into this segment by more makers, each in search of their piece of the pie? Nope. That’s the way this industry works: Grab the loose ball and pile on.

It’s true that the Japanese gained market share hand-over-fist by building safe, durable, reliable, high-quality vehicles. Yet the Europeans made strides, as well. In the upper end of the market–the automotive equivalent of Sub-Zero refrigerators–Mercedes and BMW swept past their rivals to become the standard by which everyone else was judged. Soon everybody wanted a piece of this pie, which begat Ford and Jaguar, GM and Saab, Honda and Acura, Toyota and Lexus, Nissan and Infiniti. Unlike refrigerators, however, name recognition wasn’t enough. The vehicles also had to provide the performance and handling expected in this class–a standard often set by BMW–in order to be considered credible. And those expectations began to seep into other segments as buyers drove their expectations outward. The domestics missed the boat.

It wasn’t always this way. During the 1930s and early 1940s, American automobiles expressed a clear-eyed optimism that is so unique to this country. After the Second World War, the innocence was replaced with an American-centric outlook that couldn’t imagine a world in which the United States wasn’t setting the tone and the pace. Yet it was also a time in which the market started to open up to imports from Europe and Asia, and–not surprisingly–a segment of the population found themselves pulled away from automakers they saw as increasingly irrelevant. Detroit’s response was to pile on, creating “import fighters” that tried to copy the leaders without understanding why foreign cars were appealing. In their arrogance, the domestic automakers predicted sudden defeat for the enemy, and a return to the status quo.

The damage was complete when arrogance turned to self-doubt, and an industry and country no longer knew what they stood for, or what it meant to be an American. If you look out at the domestic offerings today, it’s impossible to say Ford stands for this, Mercury for that, this is what differentiates each of GM’s divisions, and Chrysler and Dodge vehicles can be described with this simple phrase. The confusion, self-doubt, and greed driven by the need to suck the profit out of every niche and segment has marooned the U.S. auto industry in a sea of irrelevance where passion is replaced by commodity pricing and rebates.

Unless Detroit rediscovers its American spark, ingenuity, and forward-looking idealism, it may be necessary to place the industry in a Sub-Zero freezer next to Walt Disney’s head until a cure for this disease can be found.

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