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Fix It Again
Taxpayers
Back when
all foreign cars
were the butt of
Americans' jokes there
was a knee-slapper
about one
particularly
unreliable European
marque. "Fix
It Again Tony" is
the punch line
question to the
Jeopardy! answer:
"What does FIAT
stand for?"
Until Japanese cars
caught on in North
America
(most
of us
Boomers
were married with
children by then)
the import market
was all about quirky
little European models like VW's
original beetle plus a handful of
snobbish hi-lux
and exotic brands. With the ascendancy
of Nissan, Toyota
and Honda, however, Euro
niche
brands like FIAT,
Peugeot and Opel
were forced out of
the US market.
Now that the Obama
administration has
taken a stake in the
Chrysler-FIAT
experiment it is
sadly likely that
the auto marketing
think tank will be
heavy on
Euro-socialist,
environmentally-conscious
bureaucrats and
theoreticians but
light on car guys, auto
enthusiasts and
comfort-craving
Middle Americans.
We might as well
demand that the current
Chrysler overstock
be taken to auctions
and sold
piece by piece to
the highest bidders
and that its real
estate and other
assets be liquidated
so the government
can, once and for
all, wash its hands
of the car business.
Unless and until the
government car czars
grasp a few simple
facts about the
American car-buying
public, the throwing
of taxpayer money at
domestic automakers
will never end.
-
Tax breaks and "cash for clunkers" subsidies will not get the job done.
Big rebates, low APR
financing, no-dicker stickers and factory incentives for college
grads, first-time buyers, members of the military and folks on
fixed incomes are never enough to move distressed
merchandise. Americans love to bargain with salesmen!
While you might assume that younger, more liberal Americans are
less likely to dicker, the advent of Consumer Reports
followed by exposure to hundreds of Internet car-buying tutorials
per year have actually emboldened younger people, making them more
apt to arrive in the showroom loaded for bear and ready to hammer
the dealer -- and not before they've received low-ball price
quotes from multiple dealers via e-mail. The influx of
immigrants from Asian and Mid-Eastern nations over the last
quarter century has also added to the popularity of bargaining.
-
Fuel efficiency and
pro-environmentalism are not major motivators.
Fuel economy is a
primary concern, a bit more so since our recent four-buck-a-gallon
scare, but it is graded on a curve by car shoppers. If, for
example, a V6-equipped Chevy Impala is capable of getting 30mpg on
the highway, why would a somewhat smaller car with a 4-cylinder
engine like, say, a Toyota Camry -- EPA-rated for about the same
gas mileage and selling for about the same money -- be attractive
to a non-brand loyal buyer? For that matter, why would a
long-time Toyota owner opt for a hybrid Prius when he could buy an
extremely reliable and fuel-efficient Corolla for thousands less?
-
Government intervention has never
helped domestic car sales.
From the
mandating of catalytic converters and other pollution controls to
unrealistic Corporate Average Fuel Economy (CAFE) regulations to
bumper impact standards, the government has always made it more
difficult for truck sales-reliant US automakers to be competitive
with the so-called import brands. Being forced to, in
effect, let the government vote in its boardrooms to adopt --
without benefit of legislative approval -- its own regulations will give the
import brands an even bigger advantage.
-
Unionism has enabled the unfair import
automakers' advantage.
How dangerously ironic is it that the UAW, perennial bedmate of the
Democrats, will be a co-owner, along with the government, in the
new Chrysler? Meanwhile, non-union Asian and European
companies like Honda, Toyota, Nissan, Hyundai, Volkswagen and BMW
will continue manufacturing vehicles for the American market in
the USA at a
significantly reduced labor/employee benefits cost. There is
a growing anti-union consumer backlash and the big question that
Americans will soon be asking is: "Can we
ever count on the autoworkers' unions to act capitalistically enough
to help the domestic auto industry survive?"
Moreover, can we ever expect
the government to fix anything regardless of how many of our tax
dollars they use?
---------------------------------------------------------------------------------
The author
has been continuously involved in most aspects of the retailing of
new vehicles since 1987 and has received sales performance awards
from GM, Nissan, Mazda and Chrysler. Additionally, Ed has been
actively involved in motor sports, first as a participant and later
as a
commentator, for more than 30 years. Ed's other automotive
industry endeavors include parts/equipment sales and development
test driver.
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