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Motor-City Motivation

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THE United States auto industry is running into plenty of rough potholes these days: sluggish sales and corporate earnings, stepped-up competition from overseas (mainly Japanese) producers who now build many of their cars in the US, and the highly publicized bankruptcies of some major local car dealers. And, of course, one US carmaker, General Motors, has been taking it on the chin from a very funny (but not quite accurate, GM insists) motion picture, ``Roger & Me,'' by iconoclastic filmmaker Michael Moore.

Yet for all Detroit's difficulties, this is also a time of unusual opportunity.

New management teams are coming to the forefront this year at two of the ``big three'' US companies, Ford and GM. And changes are expected at Chrysler in the next year or so.

GM chairman Roger Smith steps down this summer. Mr. Smith's successor has not yet been officially designated.

At Ford, Harold Poling, who has just replaced Donald Petersen as chairman and chief executive officer, is installing a new management team.

Finally, Robert Lutz, who took over as head of Chrysler's automotive group in late 1988, has gradually been assuming a larger operational role in that company, auto experts say. Lee Iacocca, who continues as the corporate chairman, has reportedly hinted that he will give up day-to-day management when his current contract expires in December 1991.

The need for innovative leadership from Detroit is not hard to understand. The No. 2 car seller in the US, behind General Motors, is no longer a US company but an entity that might be called ``Foreign Seller.'' Overseas firms control over 29 percent of the US car market. GM is not that far ahead: around 34 percent of the US market. Some experts believe it could be passed in the early 1990s.

Detroit needs to recognize the obvious: promotional gimmicks, special cash-back discounts, and other gee-whiz financial incentives will not be enough to attract customers.

Buying a car has become a major financial commitment - for most families, secondary only to buying a house. That means customers want quality and service, as Japanese carmakers have long recognized.

The new and/or improved Big Three management teams in Detroit would be well served to remember that as they adapt to the changing marketplace of the 1990s.


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