The Usual Suspects

I heard Daniel Howes speak on just this subject the other evening at the CAR "Supplier Challenges, Investor Opportunities" seminar mentioned earlier. He is just as good a speaker as a writer, not always the case for a print journalist. (Full disclosure: Dan and I come from the same home town and graduated from the same undergraduate school, the College of Wooster. But we don't really know each other.)

For almost three decades now, I have been arguing that Detroit's automotive management has led a cloistered, incestuous life in the "biggest village in the nation". As Dan points out, that severely narrows the thinking of the Big 3 management.

It is hard for these executives to believe that they are at the center of what befalls our industry. This is not to say that these are bad people. Hardly. They are hard working and often very smart. It is just that they look too much at outside influences to explain their unacceptable performance.

I really don't know how to change this, other than bringing in new blood. Perhaps Bill Ford and the Ford board of directors will find their recent decision to bring in an individual from outside of our industry useful in this respect. Of course, Alan Mulally will have to deal with an inbred organization which is prototypical of the issue posed herein. One can only wish him luck.

Unfortunately, since Dan wrote his column, the Tigers lost the World Series. Well, there is always next year.

Daniel Howes

Usual suspects may not be to blame for Detroit's auto ills

G ood thing this town has the Tigers to cheer, because the hometown auto industry really is broken.

General Motors Corp. pops its third quarter numbers this week and calls them a success, despite a $3.8 billion cash burn, lower year-over-year U.S. market share and continuing losses in its auto business. With success like that, failure must be what -- last year?

Chrysler, reputedly the first to emerge from the trough a few years back, is back in it. Yet another whopping loss -- nearly $1.5 billion -- presages more Sturm und Drang in Auburn Hills. And Ford Motor Co.'s numbers, its worst in 14 years, are too depressing to even contemplate.

Which gives rise to a favorite question 'round here: Whose fault is it?

The 'enemy' is us

In the pantheon of blame, there are the usual suspects -- Toyota, other Asian rivals, NAFTA, high gas prices, dumb product decisions, gas-guzzling SUVs, currency manipulation, rich union contracts, fat executive bonuses, the Bush administration and, my personal favorite, American consumers.

You'll notice none of the would-be enemies, to paraphrase Pogo, is us. But recognizing that it might be, that the expectations of comfortable middle-class culture forged by industrial America are blocking change, would be a major step toward retooling for the 21st-century global world.

A new study by the Brookings Institution proposing strategies for reviving the "Great Lakes region" describes our prevailing culture as "plainspoken, hardworking, egalitarian and problem-solving" at its best. At its worst, it's "anti-intellectual, nativist and insular."

Sound familiar?

"A culture of expectation and entitlement grew around the economic success of its companies and the prosperous middle-class life they afforded," the study says.

'Things as they were'

"Unfortunately, the sense that this relative prosperity would always endure stifled the entrepreneurialism and economic churn that built the region. What was once a dynamic economy is now change-averse, weighed down by sticky attitudes of entitlement and hopes that 'things would stay as they were.' "

Nothing's wrong with such nostalgia, except that it a) doubles as denial and b) fails to recognize the world is changing much faster than the comfortable culture.

The chronic inability of Detroit's automakers to honestly assess where they stand in their own country is as much about an ingrained culture of comfort-cum-arrogance as it is about building the right cars and trucks for the right times.

The American exceptionalism that defined Detroit's golden era, the notion that this town and its industry are special, is being abandoned by broad swaths of America -- coastal consumers, politicians, opinion makers, even neighboring states like Indiana, Ohio, Kentucky and West Virginia who've eagerly wooed foreign automotive investment.

The overpowering temptation is to blame all of them. But if those in the middle of all this -- management, unions, employees, politicians -- can't fix their own problems, why should anyone else?

Daniel Howes' column appears Mondays, Wednesdays and Fridays. He can be reached at (313) 222-2106, dchowes@detnews.com or his blog at http://info.detnews.com/danielhowesblog.