Wednesday, November 15, 2006

all those gas-guzzling suv's

Detroit automakers met with President Bush this week. The execs asked for help in solving their problems. The result was meager, though they declared themselves satisfied. By one account, 'the president said he had a "constructive and meaningful dialogue" with the executives, noted their companies' role in the U.S. economy and pledged that his administration would consult with them more frequently.' (President shows Big 3 sympathy, November 15, 2006, BY JUSTIN HYDE, FREE PRESS WASHINGTON STAFF.)

Steven Pearlstein devoted this week's WaPo column to the subject. Here's a link and extract:
Hertz Case Is Example of What Ails Big Three

By Steven Pearlstein
Wednesday, November 15, 2006; Page D01

The car guys finally got their White House appointment this week to plea for government help. And at some level, you've got to sympathize with their predicament. Foreign imports continue to pour into the United States from countries that manipulate their currencies or protect their domestic markets. And the Big Three are forced to carry billions of dollars in health care and legacy retiree costs that their foreign rivals never will.

But then comes another reminder that these companies are their own worst enemies, careening from one strategic blunder to another for nearly three decades. This week's concerns Ford and its decision about a year ago to sell its Hertz subsidiary to a trio of private equity firms.

[This] is a lesson about what happens to companies when they lose their focus and rely on game-playing and financial manipulation. While the Big Three were dickering around buying and selling car rental companies, or getting into and out of the defense business and consumer finance, companies like Toyota and Hyundai and Honda were eating away at their market share by delivering great cars and value to customers. And it is that, more than any other factor, that has brought the Big Three to their current crisis and the car guys to Washington.

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