Competitive Connection

November 12, 2007

What others are saying . . .
Work still needs to be done
"Out where I live, you don't even see GM products, other than the occasional truck, and that is going to take a long time to change," contends a veteran industry analyst who, because of his work with the automaker, asked not to be identified by name.

Bob Lutz concedes that there's a broad public distrust of domestic products, especially in the so-called "smile regions" of the country, the East, West, and Gulf Coasts, and that this skepticism is "much deeper" when it comes to the Big Three giant, General Motors.

Lutz adds that "We still have substantial…problems in North America," which have to be fixed. Profitability isn't anywhere near what Wall Street demands. Productivity is improving, but by no means at the industry benchmark. The new U.S. contract with union workers closed 75 percent of the cost gap with foreign-owned assembly plants, but there's still a gap. And while studies show that GM's quality numbers are rising, they're still by no means the best-in-class.—Source: TheCarConnection.com, November 5, 2007

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A look at the competition
Ford’s vehicle development
Ford will have to develop and deliver more new vehicles faster than at any time in its 104-year history to keep its promise to the UAW to save U.S. factories from closure.

To pull this off, the Dearborn automaker must look to its European and Asian operations for exciting and fuel-efficient cars and small crossover SUVs, but the hometown engineers and designers will have to deliver hits, too.

The old, 4- to 6-year hang time for getting a new model on the road is a hangman's noose for a company that mortgaged its factories, even its name, for the cash to finance its turnaround.

There may be a place in the future for a truck-based Explorer SUV, but the market has moved on to car-like crossover SUVs. The days when Ford could sell 400,000 old-style Explorers a year are gone forever. To save plants that earned billions building Explorers, Ford must come up with a replacement that's as appealing as the Buick Enclave, GMC Acadia and Saturn Outlook crossover SUVs that GM introduced this year.—Source: Detroit Free Press, November 4, 2007

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A look at the competition
Toyota facing growing pains
Toyota ’s reputation for building high-quality vehicles has been tarnished, most recently by the decision by Consumer Reports to stop automatically giving a “recommended” label to all its cars and trucks.

The company remains on track to achieve its 2010 goal of owning 15 percent of the global car market (its market share in the United States was 16.2 percent through October). But biggest is not necessarily the same as being the world’s best car company, which was long Toyota’s main objective, he said. A focus on volume, for example, can easily lead to missteps with product introductions or slips in quality.

Inside Toyota, “everyone, and I mean everyone,” is focused on improving quality, said Jeffrey Liker, professor of engineering at the University of Michigan and author of “The Toyota Way,” a study of the company’s management philosophy. “Quality is how they have built their competitive advantage.”

Despite Toyota’s track record, Consumer Reports did not hesitate to pull the automatic ranking, said David Champion, the magazine’s senior director of automotive testing. “It takes a long time to earn that reputation, but it doesn’t take long to lose it,” Mr. Champion said.—Source: The New York Times, November 3, 2007

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Then and Now
Being green
Studies now show that being "green" no longer is a fad in America or just an issue for some crazies out in California.

In fact, the 2007 ImagePower Green Brands Survey found that consumers generally expect to double their spending on green products and services in the next year to a whopping $500 billion annually.

What's particularly startling is that a similar survey in 2006 said the majority of Americans weren't all that familiar with the concept of green and how their actions could affect the environment.

The reason is simple: Money.—Source: The Detroit News, October 31, 2007
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To read previous editions of the Competitive Connection or to access other information about manufacturing and labor at GM, visit http://www.gmmanufacturing.info