Trains and Automobiles

So, the media and political hand-wringing over whether the government should “bail out” or “loan” the US auto industry using tens of billions of dollars to keep the Big Three from possibly folding got me thinking.  It got me thinking about a train ride.
Earlier this year, the Beloved and I were in Germany and decided to take the train from Berlin to Munich.  Much of this ride traveled through what had formerly been the DDR (East Germany).  Berlin is all new-construction and energy, but it doesn’t take long for the landscape to give way to some pretty grim realities – poverty, ghost towns, and abandoned factories were abundant throughout the former East.  The derelict factories – literally dozens of them along our route left a lasting impression.

During the business part of the trip, I’d asked some German colleagues about the lingering differences between the “two Germanys”.  They’d said that after reunification that the state-supported industries in East Germany simply could not compete in an open Western market.  They made inferior products (the Trabant auto is almost a “classic” of shoddy design and manufacture), with high production costs using out-dated methods.

And it made me think about the auto-buying that I’ve done as an adult.  I purchase based on: price/value, handling, forecasted reliability and visual appeal.  I’ve bought four cars starting with my first in 1985 – and Detroit is 0 for 4.  I’ve never wanted a truck or SUV and each time the Big-Three cars were too expensive-for-what-you-got, had reputations of being lemons, and/or drove like a shopping cart.
Score: Japan 2, Germany 2, US 0.
And so, while I don’t oppose the government promoting an environment that supports US businesses, there’s certainly no Iron Curtain to protect them – and infusing them with cash only to keep them afloat seems like it’s getting close to that.  In the end, there has to be the potential for American automakers to produce products for which people are willing to spend their hard-earned dollars, euros, yuan and rupees.

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18 thoughts on “Trains and Automobiles

  1. I remember seeing these derelict East German factories, too. The Trabi, meanwhile, was made of cotton plastic. Most of the US-made cars were out of this market decades ago—the Taurus was a huge flop—so there is some truth to the parallel. They are simply not good enough to compete in overseas’ markets, so your own buying behaviour does not surprise me. The great irony is that GM and Ford design, engineer and build world-class cars from their European and Australian subsidiaries to compete in these markets. They just don’t sell these cars Stateside.

  2. Very good point, Steve. As much as I hate to think about that many people losing their jobs, I wonder if this hasn't been an inevitability for years. I mean, they haven't even stopped building SUVs yet! o_O

  3. I will take pontiac off of GMs hands. I have been waiting my whole life for a reliable affordable firebird. Maybe someone will finally be able to do it.

  4. Excellent point. When the government becomes an enabler whether for an individual or corporation, there isn't a justification for attempting success unless stipulations or timelines are involved. I see this on a daily basis in my job. While currently corporate bailouts are the news item of the day, the collective amount of individuals who have been bailed out for decades (without oversight) is staggering. Sorry, I'm not sure this even makes sense as these painkillers are making my attention span variable sentence to sentence.

  5. This is pretty much exactly what I was thinking. Overall, I'd probably be reluctantly "for" bailing them out, if I didn't think they would eventually go out of business anyway. But it's tough to stomach investing public funds into companies that will eventually go bust anyway, through a combination of mismanagement, inefficiency, and lack of innovation.
    Btw, when the top 3 CEOs were being grilled by Congress, they were asked why they didn't fly coach to the hearing. Actually, they each flew in their own corporate jet. When asked who would be willing to give up their corporate jets, no one raised a hand. They can't even jet pool.

  6. Jack — one of my favorite stories from Berlin was from a German chemist that lived in Berlin in the late 80s. The morning the Wall came down, he woke up and said he saw a Trabi driving down the street and thought the East Germans/Soviets had taken over!

  7. Ha — I hadn't heard the corporate jet bit. Priceless. Maybe the modern equivalent of Nero and his fiddle. The really hard part is that in recent years the US industry has begun to make some decent cars — but the overwhelming dependency on big trucks and SUVs (which apparently sell for much better margins) has crippled them.

  8. Not all of Michigan is falling to pieces. Some parts are down right beautiful, but driving into Detroit for a game or the museums requires a drive through places that truly look like they have been bombed out. It is rather sad. Maybe you can go there for your next Secret Weekend! (Or some other parts of MI that are more vacation-y)

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