GM Versus Toyota
The big news last month was that in the first quarter of 2007 Toyota had outsold GM worldwide for the first time. Is this really news or just the culmination of North America’s inability to build a good small car, dating back to the oil crisis times of the early 1970’s.
North America as a whole has always preferred a 1967 Pontiac Parisienne to a 1967 Datsun 410 or Austin Cambridge, and has always rather driven “made in America productsâ€. It has been a national pride thing for Americans, and ranks right up there with the flag and apple pie. The affluence of the baby boomers in the 1950’s and 60’s made the car a status symbol for all; give me fins, huge chrome bumpers and 500 horsepower and gasoline be damned.
Who did GM have for rivals in the 1950’s? The British still had a great foothold in North America and English descendants often preferred to drive an Austin, Hillman, Vauxhall, MG or Bug Eyed Sprite. But you remember the old joke, “Why do the Brits like their beer warm?†The answer, “Because Lucas made their refrigerators†a reference to the nasty electrical systems in those cars. So what’ll it be, a ’57 Buick or a Vauxhall Victor, a ‘55 Chevy or a Morris Minor. You can understand the American rationale
It was also a time when the suburb was still being invented and the two car family was just coming into vogue. People were just learning the art of commuting and they tended to go en masses for the first time to smaller second cars. This was first evident as the earth was firstly covered with Austin Cambridges, then Volkswagens and as time progressed it became Datsun 510’s. Then the first Honda Civics arrived, followed by Hyundai Ponies, and eventually Toyota Corollas.
Last month’s news release also said that analysts felt GM lagged behind Toyota in sales partly because they haven’t produced a fuel efficient car to rival the high fuel prices in the States.
In actual fact the Americans lost this market share back in the early 1970’s, during the great oil crisis that first saw fuel prices spike. America wasn’t ready with a good small car, and it drove the first generation of people into the imports. The ‘73 Pinto, the ‘75 Vega and ‘78 Plymouth Horizon are sure not going to make me want to ever buy another American small car. North America automakers proved that a bad product can dog a company’s reputation for generations to come.
John DeLorean’s book, “On a Clear Day You Can See General Motors†documents the bad product decisions GM made in that era. They rushed the Chevy Vega/Pontiac Astre to market with less test miles on it than any previous vehicle and were well aware of its aluminum cylinder head/engine shortcomings. But they had nothing else in the pipeline to rival the imports at the time.
People woke up in the mid 1980’s and realized that they used to buy Japanese cars because they were cheap, and now they were buying them because they were good. With that, more problems came for North America makers. Right around this time Japan started to put some luxury into their cars, moving away from being just basic transportation and stared to produce vehicles you could actually be proud of.
Today’s new Toyota Camry is the epitome of style and comfort. It has taken away the glamour that used to belong to America. American cars have become what the Japanese cars were thirty years ago, cheap, depreciating throw away vehicles. How come a ten year old Corolla is worth $5000 and a ten year old Cavalier is worth $2000? Obviously it has something to do with quality and demand.
The US is different from Canada in that they still feel it is treason, and punishable by death, to drive anything other than an American made car. Nascar racer Dale Jarrett has received death threats and has had to publicly defend his loyalty to the flag just because he has switched to the Toyota racing team this year.
Lest we forget that the world is now a global marketplace and maybe GM isn’t a North American company and maybe Toyota isn’t a Japanese company. I’m sure the folks who produced 1.2 million wheels at the Toyota plant in Richmond, BC, Canada probably think they are part of a global company.
After all, most of the Toyotas sold in North America are built here, and most of the Fords are built in Mexico. So maybe it doesn’t matter who builds the cars we choose to drive, maybe it just matters that the consumers now have more choices. People don’t have to accept whatever Detroit decides to feed them, and it is only going to make American manufactures more aware of this global marketplace they have to compete in.
And the Chinese cars are coming soon!