Toyota chief fears GM, Ford demise
06-08-05, 05:54 AM
#1
Super Moderator
Thread Starter
Toyota chief fears GM, Ford demise
CEO says U.S. policy may turn against Japanese automakers if American carmakers collapse.
June 8, 2005: 7:05 AM EDT
OSAKA, Japan (Reuters) - The outspoken chairman of Toyota Motor Corp. said on Wednesday he feared the possibility that U.S. policy could turn against Japanese auto makers if local giants such as GM and Ford were to collapse.
"Many people say the car industry wouldn't revisit the kind of trade friction we saw in the past because Japanese auto makers are increasing local production in the United States, but I don't think it's that simple," Hiroshi Okuda told a news conference.
"General Motors Corp. (Research) and Ford Motor Co. (Research) are symbols of U.S. industry, and if they were to crumble it could fan nationalistic sentiment. I always have a fear that that in turn could manifest itself in policy decisions," he said, speaking as the head of the nation's biggest business lobby, the Japan Business Federation.
Okuda, who as chairman is removed from the automaker's day-to-day operations, raised eyebrows and invited criticism on both sides of the Pacific when he said two months ago that Toyota should think about ways in which it could aid U.S. auto makers -- such as by raising product prices -- as they reel under massive health-care costs and sliding sales.
In the latest sign of tough times at Detroit's Big Two, GM Chief Executive Rick Wagoner told shareholders Tuesday of plans to cut at least 25,000 manufacturing jobs and close more U.S. assembly and component plants over the next few years.
Both GM and Ford have been cutting back output as they lose sales to Asian brands led by Toyota, which now controls 13.4 percent of the U.S. car market, the world's biggest.
Asked what he thought of GM's latest restructuring plan, Okuda said: "If you think about GM's current output volume and vehicle lineup, laying off 25,000 to 30,000 employees is inevitable."
GM, the world's biggest auto maker followed by Toyota, lost $1.1 billion in the first quarter and is riding out its worst financial crisis in more than a decade. It has been closing and idling plants over the past four years and will have cut its annual North American assembly capacity to 5 million vehicles by the end of this year from 6 million in 2002.
Meanwhile, top Japanese auto makers are adding jobs and assembly lines in North America to meet growing demand there, prompting executives, including Toyota President Fujio Cho, to dismiss concerns that their success would reignite a political backlash.
June 8, 2005: 7:05 AM EDT
OSAKA, Japan (Reuters) - The outspoken chairman of Toyota Motor Corp. said on Wednesday he feared the possibility that U.S. policy could turn against Japanese auto makers if local giants such as GM and Ford were to collapse.
"Many people say the car industry wouldn't revisit the kind of trade friction we saw in the past because Japanese auto makers are increasing local production in the United States, but I don't think it's that simple," Hiroshi Okuda told a news conference.
"General Motors Corp. (Research) and Ford Motor Co. (Research) are symbols of U.S. industry, and if they were to crumble it could fan nationalistic sentiment. I always have a fear that that in turn could manifest itself in policy decisions," he said, speaking as the head of the nation's biggest business lobby, the Japan Business Federation.
Okuda, who as chairman is removed from the automaker's day-to-day operations, raised eyebrows and invited criticism on both sides of the Pacific when he said two months ago that Toyota should think about ways in which it could aid U.S. auto makers -- such as by raising product prices -- as they reel under massive health-care costs and sliding sales.
In the latest sign of tough times at Detroit's Big Two, GM Chief Executive Rick Wagoner told shareholders Tuesday of plans to cut at least 25,000 manufacturing jobs and close more U.S. assembly and component plants over the next few years.
Both GM and Ford have been cutting back output as they lose sales to Asian brands led by Toyota, which now controls 13.4 percent of the U.S. car market, the world's biggest.
Asked what he thought of GM's latest restructuring plan, Okuda said: "If you think about GM's current output volume and vehicle lineup, laying off 25,000 to 30,000 employees is inevitable."
GM, the world's biggest auto maker followed by Toyota, lost $1.1 billion in the first quarter and is riding out its worst financial crisis in more than a decade. It has been closing and idling plants over the past four years and will have cut its annual North American assembly capacity to 5 million vehicles by the end of this year from 6 million in 2002.
Meanwhile, top Japanese auto makers are adding jobs and assembly lines in North America to meet growing demand there, prompting executives, including Toyota President Fujio Cho, to dismiss concerns that their success would reignite a political backlash.
06-08-05, 07:03 AM
#2
Lexus Fanatic
I'm not sure laying off all those employees and cutting back on health care expenses is the right solution for GM. First of all, it will mean tens of thousands of more people who cannot afford to buy a new car. THAT certainly won't help GM...or any other manufacturer.
GM has two big problems....even more so than money. First of all, their customer base is dying off....especially for the more conservative Buicks and Cadillacs. While I have long maintained .....and still maintain....that there is no reason why younger people cannot buy and drive these cars, the fact is, like it or not, they just are not doing so. The World War II generation and early baby-boomers....the main customer base for these cars...is aging and dying off (roughly at the rate of 1000 a day). The slightly younger people who would have taken their places got burned in the late 70's and 80's by the junk that GM was building back then ( I was one of them) and gravitated to imports. they have not come back, and with a few exceptions like the Cadillac V-type customers, show no signs returning. They are happy with their European imports, and, like us, with their Lexuses. Then GM management drove even more people away in 1996 when they converted the Arlington, TX plant that built the full-size rear-drive cars into a truck and SUV plant. These people switched to the Mercury Grand Marquis and Lincoln Town Car and have not come back. In doing so GM also lost the police and taxi markets to Ford. Yes, it can be argued that GM needed the plant space to satisfy the truck and SUV demand, but they paid a HEAVY price for it.
Second of all, although a few of the very newest GM products like the Buick LaCrosse, Pontiac G6, C6 Corvette, and Cadillac STS finally show some signs of improved fit-and-finish, GM has not shown much in this area since the late 1960's when they were arguably the best in the industry next to Mercedes. GM for many, many years has built substandard vehicles, quality and fit-and-finish-wise. CEO's like Roger Smith and Bob Stempel, like Lee Iacocca at Chrysler, talked quality and delivered junk. It took a long time for this to hit home.....and the decline at GM has been slow but steady.......but unfortunately it may now be too late. The chickens are coming home to roost. GM is just TOO slow to listen. A good example was back in the early 1990's at auto shows where I pointed out that the silly Oldsmobile dashes with their row upon row of dozens of tiny identical buttons was making the cars so hard to drive and operate that it was driving customers away. Went in one ear and out the other...the Olds reps didn't want to hear it.
FINALLY...in the mid-late 90's, they listened, re-did the dashes to use large round ***** like they should have done inte first place...but it was too late. The company couldn't be saved. Now they are letting Saturn deteriorate...for different reasons which I have described in earlier threads and won't re-hash here.
But...these problems are not insurmountable if GM simply decides they are going to build better vehicles and show better management, and LISTEN to people of just opening the front door and showing 25,000-30,000 people out. Hyundai / Kia, thanks to the gifted leadership of Finbar O'Neill and the inspiration and determination of so many of its employees, decided that they had had enough of being the butt of jokes and it was time to do something about it...the rest is history.
GM has two big problems....even more so than money. First of all, their customer base is dying off....especially for the more conservative Buicks and Cadillacs. While I have long maintained .....and still maintain....that there is no reason why younger people cannot buy and drive these cars, the fact is, like it or not, they just are not doing so. The World War II generation and early baby-boomers....the main customer base for these cars...is aging and dying off (roughly at the rate of 1000 a day). The slightly younger people who would have taken their places got burned in the late 70's and 80's by the junk that GM was building back then ( I was one of them) and gravitated to imports. they have not come back, and with a few exceptions like the Cadillac V-type customers, show no signs returning. They are happy with their European imports, and, like us, with their Lexuses. Then GM management drove even more people away in 1996 when they converted the Arlington, TX plant that built the full-size rear-drive cars into a truck and SUV plant. These people switched to the Mercury Grand Marquis and Lincoln Town Car and have not come back. In doing so GM also lost the police and taxi markets to Ford. Yes, it can be argued that GM needed the plant space to satisfy the truck and SUV demand, but they paid a HEAVY price for it.
Second of all, although a few of the very newest GM products like the Buick LaCrosse, Pontiac G6, C6 Corvette, and Cadillac STS finally show some signs of improved fit-and-finish, GM has not shown much in this area since the late 1960's when they were arguably the best in the industry next to Mercedes. GM for many, many years has built substandard vehicles, quality and fit-and-finish-wise. CEO's like Roger Smith and Bob Stempel, like Lee Iacocca at Chrysler, talked quality and delivered junk. It took a long time for this to hit home.....and the decline at GM has been slow but steady.......but unfortunately it may now be too late. The chickens are coming home to roost. GM is just TOO slow to listen. A good example was back in the early 1990's at auto shows where I pointed out that the silly Oldsmobile dashes with their row upon row of dozens of tiny identical buttons was making the cars so hard to drive and operate that it was driving customers away. Went in one ear and out the other...the Olds reps didn't want to hear it.
FINALLY...in the mid-late 90's, they listened, re-did the dashes to use large round ***** like they should have done inte first place...but it was too late. The company couldn't be saved. Now they are letting Saturn deteriorate...for different reasons which I have described in earlier threads and won't re-hash here.
But...these problems are not insurmountable if GM simply decides they are going to build better vehicles and show better management, and LISTEN to people of just opening the front door and showing 25,000-30,000 people out. Hyundai / Kia, thanks to the gifted leadership of Finbar O'Neill and the inspiration and determination of so many of its employees, decided that they had had enough of being the butt of jokes and it was time to do something about it...the rest is history.
06-08-05, 08:11 AM
#3
Moderator
I say Rest In Peace GM. I know that sounds harsh but that's the reality of doing business. GM is number one in it's industry and they're not in the business to make friends and soon GM will be replaced as the number one auto manufacturer in the world. GM never paid attention to it's customers and now the former and current customers aren't paying attention to GM.
06-08-05, 09:11 AM
#4
Lexus Connoisseur
It's not Toyota's fault they started from the bottom and grew their way to the top. Survival of the fittest. Toyota snuck in the back door and got GM at their own game. GM would be to blame in this situation. It's definitely a competative market. It's all fair game.
06-08-05, 09:46 AM
#5
Out of Warranty
Two fatal flaws in GM's business culture will drive the last nail in their coffin. First, pride in their assurance as an industry leader allowed Toyota, Honda, and now other brands, to overtake them in product engineering and manufacturing technology. By arrogantly assuming they were unchallenged, GM ignored their customers and continued to produce the automotive technology of the 1930's right up into the '90's. They produced "compact" cars largely by rescaling their drawings. The Corvair had taught them that new thinking produced trouble - so they went back to the comfort of the old ways of building a car. They simply built smaller big cars - but rescaling alone doesn't produce an efficient, reliable, less expensive car, only a smaller one.While Toyota and others emphasized fit and finish as a route to the perception of quality and worked hard to improve their product every day, GM attempted to do it by advertising. They ignored the fact that consumers would ride in a Toyota and discover for themselves that the finish was vastly superior to the GM counterpart. Buyers interpreted fit and finish as "Quality", and by the '90's GM had begun its slide into ignominy.
Finally, personnel policy – allowing the UAW to dominate its business has put GM and Ford in the position of hostages to their workers. By acceding to the demands of the unions, the American automakers allowed semi-skilled workers to ratchet up their paychecks to the point that they are paid far more than a comparably-productive worker in Europe or Asia is paid, and in a global marketplace, that just can’t work.
If American industry is to succeed, it must do so without paying extortion to the unions. Once a necessary component of American industry, guaranteeing worker skill and productivity in exchange for good wages and benefits, the UAW and other unions are now simply racketeers who hold a gun to the heads of the automakers demanding extreme wages and benefits packages for unskilled and unmotivated workers.
Enough! If the automakers won’t rid themselves of the unions, the marketplace will surely rid us of the American automakers.
06-08-05, 10:02 AM
#6
Lexus Champion
I see Toyota as an American company, GM and Ford as Canadian/Mexican companies. Toyota continues to bring new jobs to the U.S., while GM and Ford continue to outsource the labor to Canada and Mexico.
GM and Ford got themselves in the hole by using cheap low-quality parts to build unreliable cars and trucks. Doing so helped their executives get filthy rich. Eventually Americans wise up and start buying "imports" from Kentucky, Ohio, and Tennessee. I used to own Ford & GM, never again.
They blame imports, they blame rising pension costs, they blame health care costs, but never themselves. I wouldn't shed a tear when GM and Ford go out of business. Their auto workers can always get jobs from Toyota, Honda, and Nissan. These companies are building new plants here in U.S.A. making quality cars & trucks by Americans and for Americans.
GM & Ford, get up and compete (fairly, don't cry to the Congress,) or get the F out of the way.
GM and Ford got themselves in the hole by using cheap low-quality parts to build unreliable cars and trucks. Doing so helped their executives get filthy rich. Eventually Americans wise up and start buying "imports" from Kentucky, Ohio, and Tennessee. I used to own Ford & GM, never again.
They blame imports, they blame rising pension costs, they blame health care costs, but never themselves. I wouldn't shed a tear when GM and Ford go out of business. Their auto workers can always get jobs from Toyota, Honda, and Nissan. These companies are building new plants here in U.S.A. making quality cars & trucks by Americans and for Americans.
GM & Ford, get up and compete (fairly, don't cry to the Congress,) or get the F out of the way.
06-08-05, 10:11 AM
#7
Lexus Connoisseur
Originally Posted by HarrierAWD
GM and Ford got themselves in the hole by using cheap low-quality parts to build unreliable cars and trucks. Doing so helped their executives get filthy rich. Eventually Americans wise up and start buying "imports" from Kentucky, Ohio, and Tennessee. I used to own Ford & GM, never again.
GM & Ford, get up and compete (fairly, don't cry to the Congress,) or get the F out of the way.
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06-08-05, 10:58 AM
#8
Super Moderator
Thread Starter
Report Says Toyota May Raise U.S. Auto Prices to Support Struggling U.S. Carmakers
OSAKA June 8, 2005; The AP reported that Kyodo News said the chairman of Toyota Motor Corp. Wednesday repeated his statement that the auto maker is likely to raise its vehicle prices in the United States to support struggling U.S. carmakers.
If the U.S. auto industry collapses, it may adversely affect Japan-U.S. relations by stirring up national sentiment there, Hiroshi Okuda said at a press conference. Okuda was speaking as chairman of the Japan Business Federation, the nation's most powerful business lobby known as Nippon Keidanren.
Two weeks ago, Okuda said the biggest Japanese auto maker may raise its prices in the U.S. market to make it easier for American auto makers to beef up their earnings.
Okuda reiterated his view following General Motors Corp.'s announcement Tuesday that it will cut 25,000 jobs to reduce costs.
Honda Motor Co. has ruled out price hikes to help ailing U.S. auto makers, saying such increases could be considered price manipulation under U.S. anti-trust law.
Okuda, however, said auto makers can raise prices when they introduce new versions.
source : theautochannel
If the U.S. auto industry collapses, it may adversely affect Japan-U.S. relations by stirring up national sentiment there, Hiroshi Okuda said at a press conference. Okuda was speaking as chairman of the Japan Business Federation, the nation's most powerful business lobby known as Nippon Keidanren.
Two weeks ago, Okuda said the biggest Japanese auto maker may raise its prices in the U.S. market to make it easier for American auto makers to beef up their earnings.
Okuda reiterated his view following General Motors Corp.'s announcement Tuesday that it will cut 25,000 jobs to reduce costs.
Honda Motor Co. has ruled out price hikes to help ailing U.S. auto makers, saying such increases could be considered price manipulation under U.S. anti-trust law.
Okuda, however, said auto makers can raise prices when they introduce new versions.
source : theautochannel
06-08-05, 11:09 AM
#9
Lexus Connoisseur
Originally Posted by AmethySC
Honda Motor Co. has ruled out price hikes to help ailing U.S. auto makers, saying such increases could be considered price manipulation under U.S. anti-trust law.
Okuda, however, said auto makers can raise prices when they introduce new versions.
06-08-05, 11:30 AM
#10
These are good auto history readings
I now understand why these companies are going down.
So now they're recommending imports (like Toyota and Honda) to raise their price to DISCOURAGE people from buying? How is this is suppose to help GM and the domestics?
I now understand why these companies are going down.
So now they're recommending imports (like Toyota and Honda) to raise their price to DISCOURAGE people from buying? How is this is suppose to help GM and the domestics?
06-08-05, 03:00 PM
#11
Guest
Posts: n/a
I don't mean to bring the president into this but he needs to get his **** in this situation. How can ANYONE ignore the fact that Americas 2 largest companies are STRUGGLING and have so for years now. Only Chrysler currently is doing well and guess what, that **** is owned by Germans.
I did't live when JFK and co. were in office but in tons of reading and watching documentaries, he was like WE WILL NOT LOSE TO THE RUSSIANS!!! WE WILL BE THE SPACE LEADERS!!!
It may not have been the best thing to do with money but damnit it helped bring a country TOGETHER and we had a common goal and supported those in the space program trying to make American #1.
Today, the problem is much more REAL. The Space thing was much so about "ego" .This auto thing is about AMERICANS. Bush and co. need to talk to GM and Ford and say "WAKE THE FOCK UP". AMERICA IS A LEADER, NOT A FOLLOWER!!!!
I am AMERICAN, I would love to rock an American car with pride. I am willing to forgive the ABSOLUTE CRAP my family was sold by those SOBs in the 80s and 90s. But give me a good ARGUEMENT!!!
Outside the Vette and Caddy (and I say that loosly), the Ford GT is out my price range, what the HELL is there to buy AMerican that is not one of the best?
Chrysler has got the PICTURE. Give em American big body styling, RWD and V-8s. I see so many 300Cs and Magnums, stock or with rims. And to people, its DESIRABLE. Not some rebate laden sedan/car. It started with the SRT-4, WHY SHOULD IMPORTS BE THE ONLY HIGH PERFORMANCE COMPACTS??? That is why I like the SRT-4, its shows WE CAN COMPETE!!!
I did't live when JFK and co. were in office but in tons of reading and watching documentaries, he was like WE WILL NOT LOSE TO THE RUSSIANS!!! WE WILL BE THE SPACE LEADERS!!!
It may not have been the best thing to do with money but damnit it helped bring a country TOGETHER and we had a common goal and supported those in the space program trying to make American #1.
Today, the problem is much more REAL. The Space thing was much so about "ego" .This auto thing is about AMERICANS. Bush and co. need to talk to GM and Ford and say "WAKE THE FOCK UP". AMERICA IS A LEADER, NOT A FOLLOWER!!!!
I am AMERICAN, I would love to rock an American car with pride. I am willing to forgive the ABSOLUTE CRAP my family was sold by those SOBs in the 80s and 90s. But give me a good ARGUEMENT!!!
Outside the Vette and Caddy (and I say that loosly), the Ford GT is out my price range, what the HELL is there to buy AMerican that is not one of the best?
Chrysler has got the PICTURE. Give em American big body styling, RWD and V-8s. I see so many 300Cs and Magnums, stock or with rims. And to people, its DESIRABLE. Not some rebate laden sedan/car. It started with the SRT-4, WHY SHOULD IMPORTS BE THE ONLY HIGH PERFORMANCE COMPACTS??? That is why I like the SRT-4, its shows WE CAN COMPETE!!!
06-08-05, 04:41 PM
#13
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Originally Posted by HarrierAWD
I see Toyota as an American company, GM and Ford as Canadian/Mexican companies. Toyota continues to bring new jobs to the U.S., while GM and Ford continue to outsource the labor
06-08-05, 06:18 PM
#14
The United Auto Workers Union (UAW) sure didn't help matters. They squeezed and squeezed for higher pay rates and richer benefits for essentially unskilled labor - beyond what could be priced into the product. You can only suck so much milk from the teat until it's dry. They killed the Golden Goose.
06-08-05, 07:45 PM
#15
Lexus Fanatic
iTrader: (20)
Originally Posted by Gekko
The United Auto Workers Union (UAW) sure didn't help matters. They squeezed and squeezed for higher pay rates and richer benefits for essentially unskilled labor - beyond what could be priced into the product. You can only suck so much milk from the teat until it's dry. They killed the Golden Goose.