A Big Three Resurgence? Don’t Hold Your Breath.

The Big 3 American car manufacturers – General Motors, Ford and Chrysler – used to be the backbone of the American economy.  They were the prototypical blue collar, middle class employers, where a hard day’s work meant putting together a great American product for a good wage and benefits.

Now, these companies are more of a running punchline than American icons.  While all three are working hard to stay afloat and adapt with the times, it appears that they’re going to face very strong headwinds in order to keep their heads above water.

While I certainly have faith that all three companies will make it through their current problems in some form or fashion, I think it’s going to take a while before they’re able to completely turn it around and become profitable businesses again.

According to a recent poll on Daily Fuel Economy Tip, I’m certainly not the only one who thinks this way.

When asked, “When will all three major U.S. automakers return to profitability?” here’s how over 600 people – our largest response ever – answered:

  • 78% said 2012 or later
  • 11% said 2011
  • 8% said 2010
  • 3% said 2009

Again, nearly 80% of respondents believe it will be at least three years until GM, Ford and Chrysler are all profitable companies again.  That’s pretty staggering, especially considering these companies stand to get a lion’s share of a recent $25B loan from Fed Government, which is meant to help update car makers’ plants in switching from producing trucks and SUVs to producing smaller, more fuel efficient cars.

Obviously, even if the Big Three are able to start mass producing the smaller cars drivers currently desire, the current credit and economic problems will make it tough to move these new cars off the lots.  After all, if fewer people can obtain the necessary financing to buy a new car, that’s going to seriously delay these companies’ return to profitability.

Hopefully, when all of the current economic problems pass, GM, Ford and Chrysler will have put themselves in a position to restore their images and, for that matter, America’s manufacturing sector, by putting out quality and stylish fuel efficient cars.

After all, it would be nice to rebuild the backbone of our country.

Comments

  1. These companies need a major overhaul of management, accompanied by a mutiny of its engineers and designers to take control from its marketers and strategic planners.

    All 3 suffer from myopia in planning, ignorant and unqualified management, and deep frustration by their best designers.

    Put the engineers in the driver’s seat for a while. They could not do worse!

  2. It was only a matter of time. I’m not at all surprised by the news. Our actions as a nation have forced car manufacturers to have to rethink their business plans. The strong will survive.

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