Detroit’s Missed Opportunity—And a Plan

By David L. Brown

The automobile industry is in full collapse mode, a situation that has been predicted for years. I am inclined to refer my readers to an essay I posted here more than two years ago, September 20, 2006, titled “An Open Letter to Ford’s New CEO.” I addressed it to Mr. Alan Mulally upon his acceptance of the post from his former job at Boeing.

In my open letter I reviewed the various factors of climate change and predicted future oil supplies, then told him:

The challenge to auto makers hinges on two crucial issues. First, the contribution of gasoline and diesel emissions to the atmosphere, and second the economic threat of future oil scarcity and skyrocketing prices.

In the light of these facts, for a company such as Ford to continue to conduct itself in the same manner as it has in the past would be a suicidal, lemming-like act of self destruction. The future is not going to be like the past, and those who hold to the old ways will be swept away before the tidal wave of environmental change that is looming over us today. Those that continue to run with the lemmings will sink beneath the waves of failure and corporate extinction.

Well, Ford and perhaps even more GM and Chrysler did not respond quickly enough, or in the proper ways and now that lemming rush leads from Detroit to Washington to …? Perhaps that ultimate Lemmingholm, the place where the souls of deceased Lemming warriors go.

I gave Mr. Mulally some suggestions, among which were:

  • To provide each U.S. state governor, Senator or national Representative a state-of-the-art hybrid vehicle to drive for one year, no strings attached.
  • To personally drive a hybrid instead of being chauffeured around in a limousine.
  • To create special incentives to Ford employees to own and drive hybrids.

Of course Mr. Mulally decided not to act on these suggestions, none of which would have cost Ford all that much. Instead, the company made no apparent effort to familiarize our political leaders with the coming generation of hybrid vehicles. Mr. Mulally flew to Washington in a private jet, and then returned driving a hybrid (as I suggested, but a bit late!) and failed to create a super incentive to push hybrid vehicles by making it a no-brainer for employees to drive them instead of pickups and SUVs.

If they had done as I suggested, well, who knows? There is no doubt that what Ford actually has done in the past two years has not led it to a favorable position.

I pointed out to Mr. Mulally that “Change from every side is bearing down on our planet like an avalanche, and there is no time to dither, no time for doubt. The world is changing, and if Ford is to have a role in the future it must not only demonstrate its ability to change with the times, but must become a leader in that effort.”

I made one more suggestion that still makes sense, and would be good for the nation, probably palatable to Congress and even the unions, and could help re-build a new industrial opportunity from the shattered auto industry, a new, forward-looking model for the changing future. Here is what I said (boldface added):

• Begin to find new product lines to reinvigorate your manufacturing assets. Under-utilized or mothballed factories are a terrible waste that have a negative impact not only on Ford’s bottom line but also on its present, former, and future employees. One idea: Devote an assembly plant to producing wind generators to help replace fossil fuel as the major source of electrical power in this nation. Engineering and manufacturing efficient and affordable wind generators should be a piece of cake for Ford’s engineers and assembly line workers. Putting faltering factories back on line will invigorate their communities and put Ford’s people and assets back to work. Such a program would create a public image to back up Ford’s commitment to the environment and with your good management from the top, it should also be profitable.

Now that idea makes more sense than ever, and let me re-state the concept in a broader framework.

Let us consider the following plan: The U.S. government, instead of bailing out the auto industry to let it continue to make the same mistakes that got it to where it is today, should create a program to provide capital to be used to re-tool mothballed auto plants, or those for which closure is planned. Each plant would be set up as a separate corporation, owned 50-50 by the auto companies and the American taxpayers. Former auto company employees would be offered new, reasonable contracts to work for the new companies. Each plant would be challenged to design and manufacture new energy sources that are climate friendly and renewable, including wind generators, solar, geothermal, tidal and any other process that meets the above requirements. This could include design and manufacture of components that could be used in future automobiles, such as high-efficiency batteries, solar charging stations for electric cars, fuel cells, or whatever the advancing technology calls for. The companies that are most successful would be free to purchase or enter into cooperative arrangements with others.

Why don’t we hear about ideas such as this? Well, because there is too much allegiance to the status quo. Those in power cannot see beyond the desperate hope that everything will go back to the way it was. These lemmings have already gone off the cliff, and now they’re asking for life preservers and drifting further out to sea when all along there is an island just over there, beckoning with waving palms and hula girls. Well, so much for metaphor. The truth is that the industrial base owned by the auto industry, and which is a major national asset, is being allowed to deteriorate when it could and should be re-directed to the present needs of our nation.

Something like that was done during WWII, when no cars were manufactured. Companies of all kinds stopped building their former products and began turning out tanks, Jeeps, airplanes, ships, rifles, howitzers, boots, landing craft and everything else needed by the war effort. We are now in an economic crisis that is the equivalent of war, and we need to take a similar action rather than clinging to the past in hopes that sales of gas guzzling monstrosities will come back into favor. (Clue: It won’t happen, and even the auto executives have finally admitted it.)

I will make one more point and that is to note that the United States no longer manufactures television sets, cell phones, computers, and a host of other stuff. Those things are made in places like South Korea, Vietnam, and most notably China. I will leave you with this question: Why are cars any different?

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