on the auto industry. Isn't it possible that the Big 3 have pursued market share instead of profits, and that's driving a lot of their current problems? I say this because I worked for a short while in a company in which the CEO (a self-proclaimed "technical visionary," an assessment the press took as gospel truth) pushed for revenues beyond all else. He bought companies that were profoundly unprofitable, but brought revenues up. Eventually, the board sold the company over this CEO's objections, and many of us lost our jobs.
I don't know much of anything about the strategy of our big automakers, but I do know that the one fact that's been parroted by virtually everyone from the car executives to the politicians to the pundits is that these companies cannot be profitable because of the $1500 in retiree benefits that are built into the cost of every car.
But this doesn't sound right to me. If I'm looking for a car for around $20,000, I'm certainly going to consider a $21,500 vehicle if I'm convinced it has the features and the quality I want. So that's the case that the Big 3 could have made, that their cars are worth that premium, if they truly were better. They might have sold fewer cars, as they would have lost the Wal-Mart shoppers who purchase based solely on cost, but they could have remained profitable. I suspect I'm missing something here, oversimplifying the issue, but it seems to me they could have avoided some of these problems.
I don't know much of anything about the strategy of our big automakers, but I do know that the one fact that's been parroted by virtually everyone from the car executives to the politicians to the pundits is that these companies cannot be profitable because of the $1500 in retiree benefits that are built into the cost of every car.
But this doesn't sound right to me. If I'm looking for a car for around $20,000, I'm certainly going to consider a $21,500 vehicle if I'm convinced it has the features and the quality I want. So that's the case that the Big 3 could have made, that their cars are worth that premium, if they truly were better. They might have sold fewer cars, as they would have lost the Wal-Mart shoppers who purchase based solely on cost, but they could have remained profitable. I suspect I'm missing something here, oversimplifying the issue, but it seems to me they could have avoided some of these problems.
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