On the Brink

[Guest buickman]

Detroit's carmakers are entering a period of crisis. For the next half-year car sales are likely to decline because of rising interest rates, bad news from Iraq and, above all, the climb in the price of gasoline. Even as that price retreats below $3, the damage has been done. People will have reason to worry about buying fuel, and that's bad for the car business.

It is especially bad for Detroit's car business, dependent as it is on pickup trucks and big sport utility vehicles: Chevy Silverados and Suburbans, Ford (nyse: F - news - people ) F150s and Expeditions, Dodge Durangos and Jeep Grand Cherokees. These parts of the business are hurting the most. The Japanese and the Germans sell heavy vehicles, too. But they aren't as dependent as Detroit is on heavy iron.

Until recently the country was buying cars and light trucks at the rate of 17 million a year. So far this year sales are running more than half a million units behind, so maybe the year will end at 16.3 million. Sales will be sinking in the first quarter, too. General Motors (nyse: GM - news - people ), Ford Motor and even Chrysler are still losing market share. Losing market share in a falling market doubles the pain.

More pain: Lots of the all-new 2007 vehicles from Detroit are these big babies, the pickups from GM, the big SUVs from Ford. They were expected to lead a sales resurgence and, at last, a move to profits.

We've already seen GM cut some overtime, and Ford, which is more conservative in planning, has cut 168,000 units (21%) out of its fourth-quarter schedule and chosen a new president and chief executive, Alan Mulally, the Man from Boeing (nyse: BA - news - people ). GM is talking about chopping 12% from its fourth-quarter plan. I expect more chopping by early next year.

Not everyone will agree. The optimists can tell you how GM, which has already introduced its new sport utilities and will be introducing new pickups this fall, will do well. Having new trucks helps, of course, but I think the results are going to be disappointing. There will be a rush of sales to fill early orders and then a falloff. GM also may steal sales from Ford and Chrysler, which doesn't do anything for Detroit's collective ability to fight off foreign brands.

Ford has some new small (4,000-pound) sport utilities coming, and they will balance out the new 6,000-pound Expedition and Lincoln Navigator. But I think Ford will sell fewer of its small crossover vehicles (like the Ford Edge and the Lincoln MKX), not because there's anything wrong with them but because competition is so great. Everyone has small crossovers. Chrysler has a big new SUV called the Aspen coming out, at just the wrong time. There are some smaller Jeeps and a midsize car, too. Nothing wrong with them, but they will be coming into a hotly competitive market.

All the vehicles were logical when the decisions were made three years ago to produce them. At the time gasoline cost less than $2. But historical logic isn't going to save Detroit.

It will be tougher for the manufacturers to hold to the new no-giveaway pricing. GM, and even Ford, have done a good job in keeping prices up. But the pressure to give away the vehicles--no money down, 0% interest, employee pricing, less than wholesale--will grow if times are rough, as I think they will be.

Operating losses (that is, before one-time writeoffs) will be considerable despite all the factory closings. I'm pretty sure that the proposed GM/Renault/Nissan confederation will not happen. I don't know about the possibility that Ford might team up with Nissan (nasdaq: NSANY - news - people ), especially with a new Ford chief executive and the problem of agreeing on whose name goes first in a combined company.

Pressures for management change abound. At GM, after all these years, the management hasn't been able to turn around the company. The improvements being made, and they are being made, could be washed away by a downturn. At Ford, management changes always come quickly--I can name ten living ex-Ford presidents--but none has really worked since 1996. Now a new chief is named, a Boeing man who knows nothing about the car industry. Maybe it will work. I remember, though, the last time they brought an outsider in to be president--by outsider, I mean Semon (Bunky) Knudsen, who came from GM. It was Cry Havoc! and let slip the dogs of division. So we'll see.

Detroit's luck has run out. A growing car market has covered up the failures of the past decade. Those days in all likelihood are gone for now. Saving the American industry will take dynamic leadership, energy, talent and a fighting spirit. Sure it's possible. We saw it once, when Lee Iacocca saved Chrysler.

Can today's managers at GM, Ford and Chrysler save their companies? I don't know the answer, but I keep thinking of the words of Oliver Cromwell to the Rump Parliament: "You have sat here too long for any good you can do. Depart, I say, and let us have done with you. In the name of God, go."

Jerry Flint, a former Forbes Senior Editor, has covered the automobile industry since 1958. Visit his homepage at www.forbes.com/flint.

[Guest buickman]

My absolutely favorite part:

"You have sat here too long for any good you can do. Depart, I say, and let us have done with you. In the name of God, go."

Gotta love Jerry!

[Guest YellowJacket894]

Yes, Flint, just look at one side of the picture. Focus on the SUVs and trucks and ignore declining gas prices and the competitve cars coming from at least two of Detroit's Big Three.

[Northstar]

Why does Flint always appear blind to what GM does have coming out besides trucks? Last I checked, going back a month or two and into the future about a year or so, GM has launched/will have launched:

Aveo, Aura, 08 Malibu, 08 CTS, Cobalt MCE, Aura GL, hybrid Malibu, and I think the Astra is coming at the end of 07. Now, this might not seem like a lot of vehciles compared to how many GM has, but how many cars do other manufacturers have coming out? I don't think they have 8 coming out soon.

[zhawk]

This is just another opportunity to cry the sky is falling.

Flint, like certain others who will remain nameless (at least for this post) will only take whatever information supports their chosen conclusion and ignore everything else.

Besides, if gas prices on their way up, and all the dire predictions of $5 a gallon prices by this month, didn't trash the truck market, I don't think that the current trend of prices dropping would.

[NOS2006]

What a stupidass article. I didn't even get past the first paragraph. Rising fuel prices?

[razoredge]

So let me get this straight, gasoline has dropped 30 cents a gallon, back to where it was last spring and ya'll think everything is OK again ? Its still 40-50 cents more than it was before Katrina 1 years ago. Before that everyone was tired of the current price and it was already hurting "truck" sales. Now I suppose gas will not go back up this winter ? above and beyond the $3 mark. Anyone who has been paying attention knows that immeadiately following a price drop there is an increase that sets a new higher ceiling. Then let me give a little quote that some seemed to ignore and I believe is spot on "Even as that price retreats below $3, the damage has been done."

Toyota and Honda are selling innovation and economy. Detroit is still trying to sell and survive on blow out sales of "huge" and "V8". Many GM buyers are distressed about their mileage.

Most of those cars you mentioned N* are not something many in the market are going to get excited about. They mostly sound like competition for Kia and Hyundia to me. Sad but True !

Edited September 18, 2006 by razoredge

[cmattson]

So let me get this straight, gasoline has dropped 30 cents a gallon, back to where it was last spring and ya'll think everything is OK again ? Its still 40-50 cents more than it was before Katrina 1 years ago. Before that everyone was tired of the current price and it was already hurting "truck" sales. Now I suppose gas will not go back up this winter ? above and beyond the $3 mark. Anyone who has been paying attention knows that immeadiately following a price drop there is an increase that sets a new higher ceiling. Then let me give a little quote that some seemed to ignore and I believe is spot on "Even as that price retreats below $3, the damage has been done."

Toyota and Honda are selling innovation and economy. Detroit is still trying to sell and survive on blow out sales of "huge" and "V8". Many GM buyers are distressed about their mileage.

Most of those cars you mentioned N* are not something many in the market are going to get excited about. They mostly sound like competition for Kia and Hyundia to me. Sad but True !

195117[/snapback]

1. 30 cents/gallon? What part of the country do you live in? Here in Minn, it's dropped OVER $1/gallon ($1.04 to be precise).

2. Demand for gasoline typically decreases in the winter months due to decreased travel. Demand for things like heating oil typically rise.

3. I do agree that $3/gallon gasoline will scare some potential buyers away, I also believe that there is still a large demand for tow-capable vehicles, whether it be suv's or pickups. The winner will be the one that delivers the balance of being the most-capable and provides the best gas mileage. That currently describes GM's entrants -- upon which they are raising the bar even further. I think GM is in position to weather this by taking sales from less capable trucks (Tundra: less hp, less torque AND less gas mileage).

4. And GM *doesn't* sell innovation and/or economy? Witness the Saturn Vue greenline. Middle-of-the-road hybrid performance that won't break the bank to purchase. Nobody else has anything similar in the SUV segment. The Saturn Aura hybrid debut is just a few months away. The Aveo outsells all other small-compacts. GM is actually making money on it's compact Cobalt's. It's not as bleak as Flint makes it out to be.

Flint is dismissive/selectively ignorant of his facts. GM isn't perfect, but it's better off than Flint lets on.

Tundra 4.7l: 271hp, 313ft-lbs, 15/18 MPG

http://autos.msn.com/research/vip/Spec_Gla...undra&trimid=-1

Silverado 5.3L: 295hp, 335ft-lbs, 15/19 mpg

http://autos.msn.com/research/vip/Spec_Gla...01500&trimid=-1

Edited September 19, 2006 by cmattson

[Camino LS6]

1. 30 cents/gallon?  What part of the country do you live in?  Here in Minn, it's dropped OVER $1/gallon ($1.04 to be precise).

2. Demand for gasoline typically decreases in the winter months due to decreased travel.  Demand for things like heating oil typically rise.

3. I do agree that $3/gallon gasoline will scare some potential buyers away, I also believe that there is still a large demand for tow-capable vehicles, whether it be suv's or pickups.  The winner will be the one that delivers the balance of being the most-capable and provides the best gas mileage.  That currently describes GM's entrants -- upon which they are raising the bar even further.  I think GM is in position to weather this by taking sales from less capable trucks (Tundra: less hp, less torque AND less gas mileage).

4.  And GM *doesn't* sell innovation and/or economy?  Witness the Saturn Vue greenline.  Middle-of-the-road hybrid performance that won't break the bank to purchase.  Nobody else has anything similar in the SUV segment.  The Saturn Aura hybrid debut is just a few months away.  The Aveo outsells all other small-compacts.  GM is actually making money on it's compact Cobalt's.  It's not as bleak as Flint makes it out to be.

Flint is dismissive/selectively ignorant of his facts.  GM isn't perfect, but it's better off than Flint lets on.

195122[/snapback]

[Flybrian]

Eighteen months ago called. Its wants its Jerry back.

[Drew Dowdell]

This just in, the Cobalt is making money.

[razoredge]

OK, I was being generous. Gasoline is now 2.81 here, it was formerly 3.01 with a brief peek of 3.08 so in reality our gas has dropped 20 cents. Its NY State. We havent seen $2.00 in years, maybe three ? Our gas always goes back up during the winter, our gas always goes back up immeadiately after a decrease to a higher ceiling than ever before. People that are concerned with heating homes during the winter are also not going to be ready set go on buying a new car either. What planet do you live on, I want to move there............so long as its not saturin.

GM may be better off that some want to admit, we have all seen that here. Somehow I just dont really care waht saturin and small Chevy have, what does Buick and Pontiac have ? Or are they not GM anymo ?

[Robert Hall]

OK, I was being generous. Gasoline is now 2.81 here, it was formerly 3.01 with a brief peek of 3.08 so in reality our gas has dropped 20 cents.

195308[/snapback]

About the same here..it's still $2.75-3.00 a gallon here in the Denver metro area....I haven't seen any substantial 'drop' in prices yet. I don't expect to see it under $2.75/gallon anytime here soon.

Edited September 19, 2006 by moltar

[Lucerne06]

About the same here..it's still $2.75-3.00 a gallon here in the Denver metro area....I haven't seen any substantial 'drop' in prices yet.  I don't expect to see it under $2.75/gallon anytime soon.

195311[/snapback]

I Live in extreme southern Illinois, and I go across into Kentucky and get gas at the current Tuesday price of $2.15 per gallon. Always .20 cents higher in Illinois because of taxes.....

[RBB]

Just to add - Gas was $3.20/gal in the St. Louis area in August. It's currently averaging $2.06/gal, and a few places are selling for $1.99/gal.

I don't know if these levels will be sustained or not, but if it stays on this side of $3/gal, then I'd expect SUV sales to pick up (no pun intended) a bit.

-RBB

[Petra]

Yet another enlightening article from Captain Obvious. I wonder what his next prediction will be... "Toyota reaping record profits", perhaps?

[GEESIXER]

Gas in Indy and Lexington is around 2.02!!!

[CARBIZ]

For the record, if you want a taste of where America COULD be with $3+ a gallon of gas, you need to look no farther than your cousins to the north. After Katrina, we were paying $1.30 a litre; now, it is down to $.84, even .79 on a good day - a drop of about 35%. That translates into about $3.05 a U.S. gallon, currently.

Our dealership has never relied on trucks for sales. We sell a lot of Malibus, Impalas, Aveos and Cobalts. Our biggest selling truck (hold the laughter, please) is the Uplander, followed by the Equinox. We cannot GIVE away the Tahoe.

It is very challenging for GM to guess which way gas prices are going. In the meantime, trying to straddle the entire breadth of the market is a nightmare! With the Aveo at one end and the Suburban at the other, what a juggling act. At least Wagoner and the gang had the fortitude to buy into Daewood and position itself with a fleet of small, fuel efficient vehicles.

Will we have $4 a gallon gas a year from now? Or will it stay where it is? The Flint's of the world almost sound like the WANT GM and Ford to go down.

Makes you wonder how much Toyota stock they own.

[razoredge]

Id a rather Wagner and cronin would have had the fortitude to develope and manufacture compact economical cars here on our turf. Why has there always been this unwritten law that reliable and economical compact cars of industry strandard cant be built in N America ?

Wow ! Canadian gas is only 30 cents a gallon more and they have health care...............

[Robert Hall]

Id a rather Wagner and cronin would have had the fortitude to develope and manufacture compact economical cars here on our turf. Why has there always been this unwritten law that reliable and economical compact cars of industry strandard cant be built in N America ?

195429[/snapback]

I thought the argument that the big 3 have always made about building good compact/subcompact cars in NA is that they can't make a profit on them..

[regfootball]

Many GM buyers are distressed about their mileage.

195117[/snapback]

who's that? My buddy who got an 07 Avalanche LOVES the 17-18 consistent mpg he gets. meanwhile, 2 friends with pilots get 15-17.

[Drew Dowdell]

I thought the argument that the big 3 have always made about building good compact/subcompact cars in NA is that they can't make a profit on them..

195439[/snapback]

Cobalt is making money now

[CARBIZ]

Hmmmmmm......$15,000 car/$1,500 legacy/healthcare costs

$30,000 car/$1,500 legacy/healhcare costs

Which one will turn a profit? So, build the $15,000 car in Korea, where they make a lot less than their UAW counterparts (if for no other reason than the American $$ is stronger than Korean currency) OR build in Canada where the healthcare costs (to GM anyway) are a lot lower.

The mathematics are pretty clear. Just ask Toyota.

[razoredge]

I thought the argument that the big 3 have always made about building good compact/subcompact cars in NA is that they can't make a profit on them..

195439[/snapback]

I thought the problem was, they never made good compact cars. GM had an engine made in Brazil, used in compacts, had lots of problems. Then they had the "Iron Duke", not exactly whats going to get buyers away from Toyota/Nissian/Honda or VW back in the day. Thats what I was talking about, for some reason Detriot could not engineer and/or produce comparable compacts. Back when we were still driving Economy Boxes the Domestics were like junk. This is who, what, why and when we (N.America) began the huge migration to VW, Toyota, Nissan and Honda. That is the type of cars that gave Domestics their bad reputation and current perception. It was like Detroit just couldnt figure out the 4 cylinder engine. Then came the Quad 4.................looked good at first, but low and behold the bean counter cheapness showed through with head problems. Now we finally have a good 4 but its made where ? Germany or Austrailia ?

Quit crying about "legacy" costs, those people were promised that money as part of their pay package, it is their due. It was to have been invested and taken care of all these years by people "we" are supposed to trust. I dont hear anyone trying to take the Smiths or Zerillos or whoevers money away from them, and we damn sure know they didnt need it in the first place. If our government had protected its citizens as their job is paid to do, there would have been enough young workers today contributing to pension funds that this whole damn mess would not even be a wisper of a thought.

They should also be protecting us from the Doctor/Lawyer/Insurance/Drug Company organized crime too............but then who would they have left to hob nob with ?

TO answer Reg. - Mid size V6 milage is not as good as competitions.............especially in the DOHC department...................this is really going to hurt GM's main market concentration and main market potential. The people I know that are crying the most about gas prices are the people driving "trucks". One friend with a 02 Chevy truck of some sorts, sorry I really find trucks to be appliance enough to forget names and #'s. His is like a 5.3 iron LS. Anyhow hes claiming 12-14 mpg and thats rural driving and he drives so laid back and slow it drives me nuts. I never, ever trust peoples mileage claimes, never have. Over the years Ive heard some real BS about crazy mileage come out of peoples mouths. 3 bucks for every 14 miles traveled somehow looses its appeal after a spell.

Construction workers of all sorts will always buy and work new trucks, so its obvious many will still sell. I think Flint was refering to the possers. You know, all those people that one day will get out there somewhere, where they dont belong and do some real baja in' with the big bad fur by fur..............

Edited September 20, 2006 by razoredge

[Mr.Krinkle]

people like jerry flints livelihood depends on ripping apart detroit. thats what they do.

I Live in extreme southern Illinois, and I go across into Kentucky and get gas at the current Tuesday price of $2.15 per gallon. Always .20 cents higher in Illinois because of taxes.....

bastards! i knew they were ripping me off.

[Intrepidation]

I thought the problem was, they never made good compact cars. GM had an engine made in Brazil, used in compacts, had lots of problems. Then they had the "Iron Duke", not exactly whats going to get buyers away from Toyota/Nissian/Honda or VW back in the day. Thats what I was talking about, for some reason Detriot could not engineer and/or produce comparable compacts. Back when we were still driving Economy Boxes the Domestics were like junk. This is who, what, why and when we (N.America) began the huge migration to VW, Toyota, Nissan and Honda. That is the type of cars that gave Domestics their bad reputation and current perception. It was like Detroit just couldnt figure out the 4 cylinder engine. Then came the Quad 4.................looked good at first, but low and behold the bean counter cheapness showed through with head problems. Now we finally have a good 4 but its made where ? Germany or Austrailia ?

Quit crying about "legacy" costs, those people were promised that money as part of their pay package, it is their due. It was to have been invested and taken care of all these years by people "we" are supposed to trust. I dont hear anyone trying to take the Smiths or Zerillos or whoevers money away from them, and we damn sure know they didnt need it in the first place. If our government had protected its citizens as their job is paid to do, there would have been enough young workers today contributing to pension funds that this whole damn mess would not even be a wisper of a thought.

They should also be protecting us from the Doctor/Lawyer/Insurance/Drug Company organized crime too............but then who would they have left to hob nob with ?

TO answer Reg. - Mid size V6 milage is not as good as competitions.............especially in the DOHC department...................this is really going to hurt GM's main market concentration and main market potential. The people I know that are crying the most about gas prices are the people driving "trucks". One friend with a 02 Chevy truck of some sorts, sorry I really find trucks to be appliance enough to forget names and #'s. His is like a 5.3 iron LS. Anyhow hes claiming 12-14 mpg and thats rural driving and he drives so laid back and slow it drives me nuts. I never, ever trust peoples mileage claimes, never have. Over the years Ive heard some real BS about crazy mileage come out of peoples mouths. 3 bucks for every 14 miles traveled somehow looses its appeal after a spell.

Construction workers of all sorts will always buy and work new trucks, so its obvious many will still sell. I think Flint was refering to the possers. You know, all those people that one day will get out there somewhere, where they dont belong and do some real baja in' with the big bad fur by fur..............

195644[/snapback]

I disagree, the Shadows were not "junk" Speaking from experience, since my family still owns our 2 Shadows...an `87 2.2 Turbo and my `89 2.5. Granted mine is rusty and leaks some oil and tranny fluid (not much), but the other doesn't leak at all. Both have the original powertains, and mine even has the original exhaust system. Materials are good and IMO better than a lot of the interiors that followed them. After being in an accident, I can tell you they are well built too. Gas mileage is great in them as well. I would say 25-30 city and p to 40 on the highway.

[Cory Wolfe]

Premium gas is the lowest I've ever paid for it... and I've had my Millenia since mid June.

[cmattson]

I thought the argument that the big 3 have always made about building good compact/subcompact cars in NA is that they can't make a profit on them..

195439[/snapback]

So are you going to bet on Pittsburgh winning the SuperBowl 'cause they did last year too? Do you still wear a 'member's-only jacket'? My point is this: how relevant are historical conditions when analyzing GM's present-day situationt? Past conditions just don't equate to GM's present (or future-day) ability to make a profit on compact cars. The fact is that GM has worked to improve their plant efficiencies. They've down-sized their labor force and they've offshored more part-sourcing. They've improved their quality and durability (cutting warranty costs). Conditions today are vastly different from the Cavalier days. Final thought: just because Toyota built a quality car 10 years ago doesn't mean they will today.

Edited September 20, 2006 by cmattson

[zhawk]

I, for one, never said that everything is all candy and roses, but the picture is nowhere the bleak image that Flint and BM would have you believe. These guys, and people like them, keep saying the same old thing is happening when in fact, things are changing.

With costs at GM coming under control so that small cars like the Cobalt now turning a profit, the massive rebates pretty much a thing of the past, and more good products coming out, I don't think that the downturn that GM has seen in truck sales will kill them. Heck, I've shown a couple of the guys here that were in the market for a new truck the GMT-900s and they are going to check them out. And these were guys who swore they wouldn't ever buy GM. If Toyota can sell that Tundra, GM won't have to sweat selling Sierras and Silverados.

[CARBIZ]

Dodgefan, I hate to burst your bubble, but I had a '82 Dodge Rampage with the 2.2 and then a '87 Shadow ES with the turbo - both vehicles were total crap. I bought them both new. Both had two head gaskets go: one under warranty and one that I had to pay for.

I leased the Shadow and I was damn glad. Let's see what I remember:

First head gasket in three months. Engine boiling over in parking lot.

Rack and pinion steering in year 2. Two water pumps in 4 years. The entire ignition linkage went inside the steering column - it would take me 20 or 30 cranks of the key to start the car some times. The engine would mysteriously conk out on the highway, yet the lights, radio, etc. still worked, then it would start itself as I was desperately signalling to get off the highway.

The last 6 months I had the car were the worst six months of my life. The engine would start rough, even if left sitting for only a few minutes, and would NOT move - the gas pedal would not rev the engine. It ran like it was on 2 cylinders and then, suddenly, it would rev a little on its own and run smooth as silk. I took it to 3 garages - they replaced everything. Finally, the guy at Goodyear service suggested a new computer. F@@k you, I said - the car is leased and I am not spending that kind of money on a car that is going back! So I put up with it for another few months.

I swore off Chrysler after that, but I realize that I am guilty of what a lot of current import owners do - they blame Detroit for the '80s. EVERYBODY built crap in the '80s, including Toyota and Honda. (Just try and find any '80s Tercels on the road around here, yet you can find K-cars and 2nd generation Cavaliers still on the road!) The difference is that GM had the potential to piss off 5 million customers a year, Ford 3.5 million and Chrysler 2 million, while Toyota could only piss off 900k people a year! Customers have long memories and will still bitch about their '87 Pontiac 6000 while spending $140 on a service trip on their new Honda.

[Drew Dowdell]

How can you tell if a Chrysler 4-cylinder is running? If there is blue smoke coming from the exhaust.

[Intrepidation]

Dodgefan, I hate to burst your bubble, but I had a '82 Dodge Rampage with the 2.2 and then a '87 Shadow ES with the turbo - both vehicles were total crap.  I bought them both new.  Both had two head gaskets go: one under warranty and one that I had to pay for.

  I leased the Shadow and I was damn glad.  Let's see what I remember:

  First head gasket in three months. Engine boiling over in parking lot.

  Rack and pinion steering in year 2.  Two water pumps in 4 years.  The entire ignition linkage went inside the steering column - it would take me 20 or 30 cranks of the key to start the car some times.  The engine would mysteriously conk out on the highway, yet the lights, radio, etc. still worked, then it would start itself as I was desperately signalling to get off the highway.

  The last 6 months I had the car were the worst six months of my life.  The engine would start rough, even if left sitting for only a few minutes, and would NOT move - the gas pedal would not rev the engine.  It ran like it was on 2 cylinders and then, suddenly, it would rev a little on its own and run smooth as silk.  I took it to 3 garages - they replaced everything.  Finally, the guy at Goodyear service suggested a new computer.  F@@k you, I said - the car is leased and I am not spending that kind of money on a car that is going back!  So I put up with it for another few months.

  I swore off Chrysler after that, but I realize that I am guilty of what a lot of current import owners do - they blame Detroit for the '80s.  EVERYBODY built crap in the '80s, including Toyota and Honda.  (Just try and find any '80s Tercels on the road around here, yet you can find K-cars and 2nd generation Cavaliers still on the road!)  The difference is that GM had the potential to piss off 5 million customers a year, Ford 3.5 million and Chrysler 2 million, while Toyota could only piss off 900k people a year!  Customers have long memories and will still bitch about their '87 Pontiac 6000 while spending $140 on a service trip on their new Honda.

195772[/snapback]

I guess we were just lucky Granted mine's not a model for greatness anymore, but it's 17 years old with more miles than most cars of any type have. It has broken it's motor mount a few times (something inhereit to Shadows I've heard, though not once happening to the `87). Also withing the last 2 years it's had electrical problems where the dome light would not come on (broken wire...fixed). I also remember about 5 years back the headgastket was replaced. My father's a mechanic, so these things were fixed on the cheap). Last winter the break lines were replaced (New England winters are tough on cars), and the master cylinder was replaced. Currently it has no problems except that in sometimes stalls in cold weather before it awrms up, and in reverse.

I will also admit that the regualtor on the driver's door of the turbo broke a couple years ago (it has power windows), and then the passenger side did later. Still, it's even older than mine, an considering `93-`97 Corollas and Prizms have $h! regulators for their manual windows, it's not that unreasonable. The Turbo also no longer works. As you may know, they didn't have intercoolers, so you had to let it idle after using the turbo a lot before turning the car off to cool the turbo...one day my mom didn't...and yeah. See the thing is that this Shadow has never had an engine problem to the best of my knowledge, and doesn't leak any fluids either.

I still think they are good little cars, since it was at least 10 years before any real problems cropped up, and with 208k and 172k (i think) respectively, the fact that they still run well is nothing to sneeze at.

Edited September 20, 2006 by Dodgefan

[supermoto]

I thought the problem was, they never made good compact cars. GM had an engine made in Brazil, used in compacts, had lots of problems. Then they had the "Iron Duke", not exactly whats going to get buyers away from Toyota/Nissian/Honda or VW back in the day. Thats what I was talking about, for some reason Detriot could not engineer and/or produce comparable compacts. Back when we were still driving Economy Boxes the Domestics were like junk. This is who, what, why and when we (N.America) began the huge migration to VW, Toyota, Nissan and Honda. That is the type of cars that gave Domestics their bad reputation and current perception. It was like Detroit just couldnt figure out the 4 cylinder engine. Then came the Quad 4.................looked good at first, but low and behold the bean counter cheapness showed through with head problems. Now we finally have a good 4 but its made where ? Germany or Austrailia ?

Quit crying about "legacy" costs, those people were promised that money as part of their pay package, it is their due. It was to have been invested and taken care of all these years by people "we" are supposed to trust. I dont hear anyone trying to take the Smiths or Zerillos or whoevers money away from them, and we damn sure know they didnt need it in the first place. If our government had protected its citizens as their job is paid to do, there would have been enough young workers today contributing to pension funds that this whole damn mess would not even be a wisper of a thought.

They should also be protecting us from the Doctor/Lawyer/Insurance/Drug Company organized crime too............but then who would they have left to hob nob with ?

TO answer Reg. - Mid size V6 milage is not as good as competitions.............especially in the DOHC department...................this is really going to hurt GM's main market concentration and main market potential. The people I know that are crying the most about gas prices are the people driving "trucks". One friend with a 02 Chevy truck of some sorts, sorry I really find trucks to be appliance enough to forget names and #'s. His is like a 5.3 iron LS. Anyhow hes claiming 12-14 mpg and thats rural driving and he drives so laid back and slow it drives me nuts. I never, ever trust peoples mileage claimes, never have. Over the years Ive heard some real BS about crazy mileage come out of peoples mouths. 3 bucks for every 14 miles traveled somehow looses its appeal after a spell.

Construction workers of all sorts will always buy and work new trucks, so its obvious many will still sell. I think Flint was refering to the possers. You know, all those people that one day will get out there somewhere, where they dont belong and do some real baja in' with the big bad fur by fur..............

195644[/snapback]

Had an 89 Cutlass Supreme, 2.8L V6 that got 33 mpg highway, 92 Buick, 3.3L V6 that got 32. A 97 Skylark 2.4L that got 40 highway. I've known several people with V8 Silverados that got from 18 to 21 highway. Because you know 1 person that gets 14 doesn't mean that is the norm. I've been able to beat EPA ratings on every domestic I have ever owned.

Toyota expects to sell 300k Tundras a year shortly and they don't get any better mileage than anything GM has. They will redesign the Sequoia next and it can be expected to be no better than its GM competition. How many plants in the last 10 years has Toyota built in the US to produce hybrids and subcompacts and how many are for trucks? If Flint wants to criticize GM, don't you think it would be appropriate to level the same to Toyota?

[razoredge]

Had an 89 Cutlass Supreme, 2.8L V6 that got 33 mpg highway, 92 Buick, 3.3L V6 that got 32. A 97 Skylark 2.4L that got 40 highway. I've known several people with V8 Silverados that got from 18 to 21 highway. Because you know 1 person that gets 14 doesn't mean that is the norm. I've been able to beat EPA ratings on every domestic I have ever owned.

195929[/snapback]

OK DOEKAY, I hate to do it but heres one of those I was talking about. I bet there was a special potion used in the tank on these puppys too ? I have had many 3.8 powered 80's & 90's GMs. 3.8s are well know, to not only have far more power than the 2.8/3.1 but also far better milage. I spent many hours on the W body forum and know all about the kind of disappointing mileage those guys were getting. My old 3.8's average 20 around & about and will give 25 highway.

I am currently driving a 90 Ciera with the 3.3 and it gets 20 mpg period. It runs perfect and has been well maintained and has great power. It gets 20 mpg period, no highway mileage used but we have plenty of open road driving, enough to let me know that this would do the same as our 3.8's on interstates which is 25. In fact its a bit worse, because the 3.3 is multi port injection which is less effecient than sequential.

I know many people that drive GM trucks and they all have told me they use some serious gas. This is just the only guy that keeps the records and does the math, using full tank to full tank, and is not the type to search for bragging rites. 40 mpg is old, light, VW Rabbit Diesel territory, dont expect to sell me on a Skylark achieving that. Hell our 3 cylinder Chevy Sprint never reached the 40 mark, high 30's was it.

Do I think Silverados can reach 18 ? Yes. 21 ? no way. What do I think the average fo by fo "truck" driver gets for average mileage ? 14. My 2wd V6 Dakota only got 15, sometimes it didnt even make that. Just the aerodynamics of a truck is the first clue, then your hauling all that weight and front axel, transfer case, tie that in with a V8.

I borrowed my buddies old 4.3 V6 GMC last fall for some wood haulin and it about killed me. 90 dollars in one day.....................it was less than 200 miles.

Maybe you had that special carburator installed ? Or maybe a Tornado intake implant ?

[regfootball]

How can you tell if a Chrysler 4-cylinder is running?  If there is blue smoke coming from the exhaust.

195782[/snapback]

"I always loved that one"

[Robert Hall]

So are you going to bet on Pittsburgh winning the SuperBowl 'cause they did last year too?  Do you still wear a 'member's-only jacket'?  My point is this: how relevant are historical conditions when analyzing GM's present-day situationt? Past conditions just don't equate to GM's present (or future-day) ability to make a profit on compact cars.  The fact is that GM has worked to improve their plant efficiencies.  They've down-sized their labor force and they've offshored more part-sourcing.  They've improved their quality and durability (cutting warranty costs).  Conditions today are vastly different from the Cavalier days.  Final thought:  just because Toyota built a quality car 10 years ago doesn't mean they will today.

195741[/snapback]

GM's past problems contributed to them getting where they are now...

[Drew Dowdell]

GM's past problems contributed to them getting where they are now...

196053[/snapback]

many of GM's past problems have been addressed.

not all...but enough for the Cobalt to make money

[Robert Hall]

many of GM's past problems have been addressed.

not all...but enough for the Cobalt to make money

196060[/snapback]

That's good to hear the Cobalt is making money..pretty good product from what I've read.

[91z4me]

[zhawk]

OK, Razor, my fuel log books provide plenty of counterarguments to your numbers.

My 96 Metro averages 47MPG with 209K miles on it. Not sure what was wrong with your Sprint. Heck I was getting better than 30MPG in a old 89 Metro when a spark plug wire was bad and only 2 cylinders where firing correctly.

My 99 Silverado averages better than 17MPG, reaching 19 if mainly driven highway miles on a tank. (mostly driven by my wife who accelerates aggressively)

The truck has a 5.3L V8.

My old 2000 Grand Prix GTP averaged 28MPG with mixed mileage, better than 30 (as high as 34) if driven mostly highway.

Nothing special done to any of my cars, just maintained properly. We log each time we fill the tank to watch for noticeable drops in fuel mileage.

I know you aren't going to trust my numbers but they are real world.

I am not sure that people are crying over the legacy costs. It seems that they are only noting that these are a drag on the profitability of GMs cars. Its a fact and that's all. Now, it seems that things are coming to a point that GM can pay out the costs and still profit off their small cars.

There's a huge difference between being a blind fanboy and being positive about what is going right. Just as their is the same differerence between noting where GM needs to improve and constantly bashing everything they do. I, for one, tend to be optimistic about where GM is heading. There's still a ways to go but it looks like they might be on the right path.

[Drew Dowdell]

Another point to be made:

The Cobalt making money now means two things:

1. Vehicles that were previously profitable are now more so. Apparently GM made a LOT of money on each Avalanche sold. So now with legacy costs reduced, the GMT-900s will be able to provide even more profit back to GM.

2. The lower MPG vehicles that tend to be more profitable <trucks/suvs mostly>, now can still turn a profit at a lower volume <thinking gas prices here> because they are no longer subsidizing the compact cars that weren't profitable before.

The cobalt making money *really* indicates the over all health of the company at lot more than just that one platform. It's this that will allow Buick and Pontiac to sell at lower volumes with fewer platforms and still be viable.

[carman21]

Interest Rates have leveled off. GasPrices are collapsing. Finally, GM's is coming out with more fuel efficient trucks and SUVs not to mention the massive expansion of excellent car products that are begining to come out of Detriot, specifically from GM.

Toyota and Nissan spent tons of money on pick-ups and SUVs and the have failed to gain market-share and they actually are not competitive with GM or Ford both in MPG and in power. Not to mention capability. Nobody mentions that in the Japan,Inc. media.

[FUTURE_OF_GM]

This is, quite possibly the DUMBEST article I've read this year...

More doom and gloom bull&#036;h&#33; from the tired press.

I'm to the point that I couldn't care less now. Maybe Detroit will go out of business and maybe not, either way I'd like for these idiots to shut the hell up about it and focus on something other than a "what if" article that does nothing but WASTE MY TIME.

REPORT THE NEWS... DO NOT CREATE IT

[razoredge]

While you all may not agree with his sumary, he still made some valid points. Myself I cant make a sumary of the future of the real American auto industry. I do feel its going to loose as all other manufactureing in the US has. Sure the Japs will build cars here just due to logistics but they wont be what most of us older Americans will consider American. I suppose as long as our leadership like Bush and all the other pushovers continue making statements about the "new" American automotive industry, most Americans will be just fine with it. Hell they are already. I dont think Ford, GM and Chrysler will get them back. They belong to Honda/Toyota now, and the cheepskates like myself that have thrived on used GM's or Fords will eventually buy Hyundias and Kias. Many already are. Thats my opinion and prediction. I fight it but its a loosing battle on account of the attitude in this country, both consumer and business leaders. As it is, with all the outsourcing they are hardly American anymore anyhow..........so really ? why should we give a damn ? What are we fighting for ? Legacy ? The Legacy of owning a vehical built in your own country by your own fellow man ? Tradition ? Buying vehicals from the former industrial giants and decendants of the men and woman that defeted the Germans and Japanese in the 40's so we could have all this that we have today ? It means nothing anymore.................right ? So what are we so attached to a name ? General Motors ? What does it really mean anyhow ? Made in Mexico ? Made in Australia ? Made in Germany ? Made in China ? Made in India ? Made in Turkey ?

It really doesnt matter anymore does it ? Its just a badge.

Hawk - Our L67 LSS bested itself on continous freeway driving at between 74-80 mph at 26 mpg. Thats it, it has never once hinted in being interested in delievering anymore. THat was running both south and back north from midstate NY to Knoxville Tennesee. Three different trips, same results everytime. While its about one hundred pounds heavier than GP with slighty more frontal area, its still a very aerodynamic package. Im also a very effecient driver in ways such as coasting up to intersections and not using lots of brakes becasue I let off at last moment. While we do travel swiftly I do alot of low load acceleration and deceleration. So no, though I do feel you are pretty stand up, I still cant believe your results.

I was impressed with the 17 mpg I achieved with my Grandfathers 318 TB injected 82 NYer. Also, the 15 mpg I achieved with the 76 Delta w/denutted 350 Olds I still dont believe most people claims.

Ive talked to people that try to claim 20's with above mentioned cars...........never !

[balthazar]

It really doesnt matter anymore does it ? Its just a badge.

It matters to me. Should it not? Am I 'wrong'? Am I doing something unpopular by caring? Should I feel pressured to do what my neighbor does? Should I care if others care that I care?

General Motors is an American corporation- always has been. Some of it's products are assembled in other countries, and some of it's parts are manufactured in other countries. Does this change the fact that GM is an American company?

Some people would (mistakenly) lead you to believe: yes it absolutely does.

Funny how those same people never include toyota or honda or nissan when they're moaning about the 'sorry state' of the American auto industry, or the 'uncompetitive product' from American car makers.

Consistancy seems about as fashionable as driving an American vehicle these days.

[razoredge]

Balth - that whole entire paragraph was a fist in the air, lip biting, spittin and kickin rage at the whole pile of bull &#036;h&#33; that brought us to these times and the blind eyes that wont address the real problems and long term results they achieved.. all this obvious crap and we just keep trudging forward with careless blind faith that somehow someday this will be a better country for it. "just wait, you'll see"

Yea, I friggin care, just wondering who else does

[razoredge]

Another point to be made:

The Cobalt making money now means two things:

1. Vehicles that were previously profitable are now more so.  Apparently GM made a LOT of money on each Avalanche sold. So now with legacy costs reduced, the GMT-900s will be able to provide even more profit back to GM.

2. The lower MPG vehicles that tend to be more profitable <trucks/suvs mostly>, now can still turn a profit at a lower volume <thinking gas prices here> because they are no longer subsidizing the compact cars that weren't profitable before.

The cobalt making money *really* indicates the over all health of the company at lot more than just that one platform.  It's this that will allow Buick and Pontiac to sell at lower volumes with fewer platforms and still be viable.

196255[/snapback]

Just wanted to say good points, except for trying to make it OK for Buick and Pontiac to be further castrated and robbed of their earned due. Kinda sounds like its OK for Caddy and .....................saturin?.................to supercede Buick (Oldsmobile) and Pontiac...........just because?..........The BOP team sold all those H, C, W, B, A, E bodies so Caddy and ..............saturin?.... could get the developement funding and all the toys.........................Buick and Pontiac will be lucky to make it to the supposed next round of "updates". The long term plan is getting a little more than a bit obvious as this year has evolved. Then when they are done, Im sorry, they can call it GM but it will no longer be GM, it will be Chevrolet, saturin, Cadillac and that aint, General Motors, ah no more..............

[zhawk]

Hawk - Our L67 LSS bested itself on continous freeway driving at between 74-80 mph at 26 mpg. Thats it, it has never once hinted in being interested in delievering anymore. THat was running both south and back north from midstate NY to Knoxville Tennesee. Three different trips, same results everytime. While its about one hundred pounds heavier than GP with slighty more frontal area, its still a very aerodynamic package. Im also a very effecient driver in ways such as coasting up to intersections and not using lots of brakes becasue I let off at last moment. While we do travel swiftly I do alot of low load acceleration and deceleration. So no, though I do feel you are pretty stand up, I still cant believe your results.

I was impressed with the 17 mpg I achieved with my Grandfathers 318 TB injected 82 NYer. Also, the 15 mpg I achieved with the 76 Delta w/denutted 350 Olds I still dont believe most people claims.

Ive talked to people that try to claim 20's with above mentioned cars...........never !

196336[/snapback]

I am sorry that you have so little faith in other people as to think that they (in this case, I) would lie or make up numbers for mileage. But, believe what you wish. It doesn't change the truth. Maybe its because of the roads I drive around here in Western Washington, maybe not. Or maybe its because I have to watch the speed limit more here with the cops around my home area and on the bases (one highway between home and work passes through an army base).

Anyway, I'm done with that argument.

I firmly believe that things are changing for the better within GM, and that's for all of its divisions. Will it all work out? Only time can tell. In my opinion, we are better off making sure GM knows that there is major interest in all of its brands, then complaining when this brand gets this and that brand doesn't.

[Cory Wolfe]

Oh look... gas has yet again gone down. $2.55 for premium... BV likes. And to add to that, my Millenia is finally getting better than 20 mpg average. After I change the spark plugs (to Bosch Platinum 2s), the oil/filter, and eventually the air filter and hose assembly, I hope to actually meet or exceed the EPA mileage (27 highway) for the first time. Sad, but funny.

[joemac]

GM may be better off that some want to admit, we have all seen that here. Somehow I just dont really care waht saturin and small Chevy have, what does Buick and Pontiac have ? Or are they not GM anymo ?

195308[/snapback]

Buick and Pontiac are not full line brands, thus don't have econo boxes. How many econo boxes are present in the Infiniti and Lexus brands?