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The Real American Auto Industry

As crocodile tears are shed for GM and its now penny shares of stock, commentators are also mourning the demise of the American auto industry. While I also regret the loss of jobs at the former “Big Three”, the truth is that the American auto industry is alive and well – – we’ve just been looking in the wrong place.

As crocodile tears are shed for GM and its now penny shares
of stock, commentators are also mourning the demise of the American auto
industry. While I also regret the loss of jobs at the former “Big Three”, the
truth is that the American auto industry is alive and well – – we’ve just been
looking in the wrong place.

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The front page of the June 1st 2009 New York
Times shows a bar chart of GM’s sales for the past 50 years. In the 1960s, GM
sold over 4 million cars a year and under a million trucks. By the first decade
of the 2000s, GM was selling under a million cars each year and over 2 million
trucks. Of course SUVs were the real product, because GM put those living rooms
on wheels atop truck chassis. Looking at that sales progression over time, it’s
clear what happened to GM and its Detroit brethren. Instead of producing
efficient vehicles in appropriate sizes for the marketplace, they gambled on what
appeared to be more profitable gas-guzzlers and, like anyone else in Vegas,
finally went bust.

 

Meanwhile, on May 13th, Honda announced that it
will begin manufacturing cars, powered by cleaner burning natural gas, in
Greensburg, Indiana (see www. civicgx.com).
The engine for this greenhouse gas-busting marvel will be manufactured in Ohio.
Lots of suppliers will do lots of business with these factories in many
surrounding states. Sounds like the American auto industry to me.

 

It sounds even more red-white-blue when you realize that
Honda has been manufacturing cars in the US for 40 years already and has invested
more than $12 billion in its North America operations, including 16 major
manufacturing facilities with more than 35,000 employees. These very American
factories also produce millions of motorcycles, lawn mowers, and small engines
for everything else. That’s not just the colors of our flag, it’s the color of
money flowing into our economy.

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So let’s cancel the wake for Detroit and celebrate the
emergence of the real American auto industry – – the one that also boasts
management and investors who were smart enough to respect their planet, people,
and long-term profits instead of risking everything for fool’s gold. There may
be some useful lessons in this for other shrinking “American” industries in
these tough economic and environmental times.

About the author

From his youth in Australia to career experiences in Europe, Africa, China and across the United States, Terry has developed expertise in business, farming, education, non-profit, the environment, the arts, and government. A United States Coast Guard-licensed ship captain, Terry has long been drawn to the undersea world, starting in the 1960s with a family-run tropical fish breeding business in Australia and continuing with studies on conch depletion in the Bahamas, manatee populations in Florida coastal waters, and mariculture in the Gulf States with Texas A&M University.

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