xcel
11-25-2006, 09:35 PM
Big Three will have to create, dominate their own niches. (http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2006/11/25/MTGEOMILEM1.DTL)
http://www.cleanmpg.com/photos/data/501/2007_Toyota_Yaris5.jpgMicheline Maynard - New York Times – Nov. 25, 2006
Toyota Yaris - Mass appeal with mass production.
U.S. automakers will have to adapt to survive.
Huge stamping presses beat out an ear-splitting rhythm of "ca-chunks" as they bang out metal sides and roofs for the small Yaris cars built here. Deep inside the plant, injection-molding machines spit out brightly colored front and rear bumpers, looking like so many Lego pieces, which are loaded onto racks to be towed to the assembly line.
By contrast, the atmosphere at BMW's plant in Leipzig, Germany, is decidedly more refined. Its soaring gray-and-silver factory, designed two years ago by the architect Zaha Hadid, is the equivalent of automaking by Armani.
Unpainted car bodies, their sheet metal the hue of brushed pewter, ride silently through the plant lobby, lighted from beneath in blue, providing a perfect accent to the colors of the building.
Outsiders are not allowed near these 3-Series models; instead, they must observe production from a catwalk above the assembly line. Below, in what seems more like a very expensive kitchen than a factory floor, workers clad in neat coveralls stroll along an assembly line that spreads into a series of fingers, the places where the real work goes on.
These two plants, one high-volume, the other high-end, may seem to have little in common with each other, let alone with the U.S. car market. But together, these plants -- and the niches they serve -- may offer some idea of what lies ahead for American automakers.
During the past, awful year for Detroit, industry executives and experts have been puzzling through what will become of General Motors, Ford Motor Co. and the Chrysler Group. One potential future consists of total disaster, with the Detroit automakers vanquished by their Asian and European rivals. This is an option that only those with a doomsday complex really believe, given the Detroit companies' billions in cash and broad infrastructure.
Another potential outcome is that the Big Three vanquish the competition to again rule American roads, a prospect that has faded in 30 years of fighting the imports and is even more improbable now that foreign companies hold nearly half of the market.
A third option, much more likely than the others, is for GM, Ford and Chrysler to adapt to a new American market that in many ways resembles Europe's: a fragmented bazaar that has little in common with the mass-production ethos of Detroit's first century. In this new American market, it is very hard to profitably support enough different brands and models to guarantee "a car for every purse and purpose," which Alfred P. Sloan, as GM's president, declared to be the company's mission in the 1920s.
Rather than trying to be all things to all people, Toyota, BMW and other successful carmakers are concentrating on a different strategy: Find a niche, hone it and own it. In Europe, for example, the market is not dominated by any single player or small group of players with market shares that dwarf smaller competitors the way GM, Ford and Chrysler once did in the United States. Instead, Europe's car sales are splintered such that 5 percent is enough to make a difference, and 20 percent is more than anyone can expect.
"There's no case anywhere in the world of any previously dominant manufacturer retaining much more than 20 percent once the market is opened to full global competition," said GM Vice Chairman Robert A. Lutz in a recent interview.
As is the case in Europe, no auto company in America can automatically count on selling hundreds of thousands of one particular model annually as they could even five years ago, meaning that they must find ways to profitably stay on top of market trends -- or be left in the dust. In Europe, and increasingly in America, consumers are demanding the latest in environmental technology, both to save gasoline, as with hybrids, or to avoid using it altogether, as with diesel-powered cars.
While some national loyalty lingers in Europe, as it does in the United States, no company can rely on such loyalty to sell cars. Carmakers are forced to continually update their brand images in order to stand out in a crowded market. At the same time, like their European counterparts, America's unionized autoworkers must also adjust.
http://www.cleanmpg.com/photos/data/501/2007_Toyota_Yaris5.jpgMicheline Maynard - New York Times – Nov. 25, 2006
Toyota Yaris - Mass appeal with mass production.
U.S. automakers will have to adapt to survive.
Huge stamping presses beat out an ear-splitting rhythm of "ca-chunks" as they bang out metal sides and roofs for the small Yaris cars built here. Deep inside the plant, injection-molding machines spit out brightly colored front and rear bumpers, looking like so many Lego pieces, which are loaded onto racks to be towed to the assembly line.
By contrast, the atmosphere at BMW's plant in Leipzig, Germany, is decidedly more refined. Its soaring gray-and-silver factory, designed two years ago by the architect Zaha Hadid, is the equivalent of automaking by Armani.
Unpainted car bodies, their sheet metal the hue of brushed pewter, ride silently through the plant lobby, lighted from beneath in blue, providing a perfect accent to the colors of the building.
Outsiders are not allowed near these 3-Series models; instead, they must observe production from a catwalk above the assembly line. Below, in what seems more like a very expensive kitchen than a factory floor, workers clad in neat coveralls stroll along an assembly line that spreads into a series of fingers, the places where the real work goes on.
These two plants, one high-volume, the other high-end, may seem to have little in common with each other, let alone with the U.S. car market. But together, these plants -- and the niches they serve -- may offer some idea of what lies ahead for American automakers.
During the past, awful year for Detroit, industry executives and experts have been puzzling through what will become of General Motors, Ford Motor Co. and the Chrysler Group. One potential future consists of total disaster, with the Detroit automakers vanquished by their Asian and European rivals. This is an option that only those with a doomsday complex really believe, given the Detroit companies' billions in cash and broad infrastructure.
Another potential outcome is that the Big Three vanquish the competition to again rule American roads, a prospect that has faded in 30 years of fighting the imports and is even more improbable now that foreign companies hold nearly half of the market.
A third option, much more likely than the others, is for GM, Ford and Chrysler to adapt to a new American market that in many ways resembles Europe's: a fragmented bazaar that has little in common with the mass-production ethos of Detroit's first century. In this new American market, it is very hard to profitably support enough different brands and models to guarantee "a car for every purse and purpose," which Alfred P. Sloan, as GM's president, declared to be the company's mission in the 1920s.
Rather than trying to be all things to all people, Toyota, BMW and other successful carmakers are concentrating on a different strategy: Find a niche, hone it and own it. In Europe, for example, the market is not dominated by any single player or small group of players with market shares that dwarf smaller competitors the way GM, Ford and Chrysler once did in the United States. Instead, Europe's car sales are splintered such that 5 percent is enough to make a difference, and 20 percent is more than anyone can expect.
"There's no case anywhere in the world of any previously dominant manufacturer retaining much more than 20 percent once the market is opened to full global competition," said GM Vice Chairman Robert A. Lutz in a recent interview.
As is the case in Europe, no auto company in America can automatically count on selling hundreds of thousands of one particular model annually as they could even five years ago, meaning that they must find ways to profitably stay on top of market trends -- or be left in the dust. In Europe, and increasingly in America, consumers are demanding the latest in environmental technology, both to save gasoline, as with hybrids, or to avoid using it altogether, as with diesel-powered cars.
While some national loyalty lingers in Europe, as it does in the United States, no company can rely on such loyalty to sell cars. Carmakers are forced to continually update their brand images in order to stand out in a crowded market. At the same time, like their European counterparts, America's unionized autoworkers must also adjust.