Friday, July 25, 2008

To the Auto Manufacturers

Dear GM, Toyota, Honda, and the others:

From a professional perspective, I feel terrible for you. You're losing lots of money, employees and clients, and that's never good for business. Considering our entire country (and the rest of the world) relies on transporation and you likely supply 90% of it, everyone else is also struggling. So we're in this together.

From a personal perspective, I probably couldn't be laughing harder. The only reason I am laughing and not empathizing is because your problems are the result of quick expansion and risky behavior, both of which are subjects covered in high school economics. I'm glad you have managed to supply the world with good transportation for so many years and have kept up with times of innovation and prosperity. You have obviously done something right because you've survived for so long. But the markets are falling, you are freaking out, and I'm laughing because of it.

One thing you neglected to look into is the fact that people change and so do their tastes. Did you really think that the internal combustion engine was going to be as popular in 2008 as it was in 1920? Numbers would of course trump my statement and it could easily be proven that yes, the demand for cars today does not even compare to demand back in the 20s. But we didn't know any better back then; we were just as clueless as you were. The only difference is that we have changed and you have not, and now the market is doing its job perfectly.

Here's what I'm wondering: Through all your financial planning, all of your market research, all of the years you've spent in such a lucrative business, how did you not expect a shift in the market? Why did you continue to push the same product every year (regardless of new models) and not prepare for a decline in sales? Especially in the last couple years as this whole "green" thing has taken hold of every other market?!

The transportation industry needs an overhaul, and you are trying everything in your power to prevent one. You have such an opportunity to turn everything around and start making millions again, but you have to succumb to a transitioning marketplace first. Toyota has started with the Prius, and they're making a killing right now. Unfortunately for them, though, hybrids will also be something of the past very shortly as the awareness of the global dependence on crude oil has shifted the consumer's demand for alternative and sustainable energies. I realize that you are only one part of this whole economy mess and there are other things to worry about, but NONE of the economy would operate without the transportation of goods. So you see we are in quite over our heads here, and we have been for entirely too long.

There's a great department that I recommend you use, and it's called Research and Development. It's not hard, and really just takes some creativity and thinking. Why not take some of your existing factory employees and offer them some time within the R&D department? Yes yes, I realize that there are trained professional within your R&D department that would just be getting their toes stepped on, but they'll be fired sooner than later if you don't get some more heads in there. See what the common-man has to say. Interview people. What do WE want? Think of OUR interests and not just those of your wallets and pocketbooks. Be willing to lose money before you gain it again. Stop trying to push a new model every year by remaking (that's right) the models that you know already work. But what about your quotas? Don't set them. Hold some money in your banks-- enough that will cover the cost of a mistake or decline in sales. It's something called 'surplus'-- also something learned in high school economics. If you have money, it's called surplus; if you don't, it's called debt. Keep trying to work within your debt and you'll end up in more debt. And if you get bailed out, someone else will be in debt. Cover your bills. Do some R&D. Get existing employees to have job diversity by offering other positions. Play around with things and most of all, have fun.

We NEED cars. But we also need you to be smart so that we don't fall with you.

Sincerely,
your average consumer who gives a damn.

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