Wednesday, January 04, 2006

12. Like A Pebble (Oh, Like a Pebble)


America will lose the title of biggest automobile maker next year or so to Toyota Motor Company. Does this concern anyone else? I’ll tell you why this concerns me...not because GM makes better cars than Toyota. Which it doesn’t. GM makes horrible cars that break down easily while having constant problems. They are also both technologically inefficient and aesthetically displeasing.

And it doesn’t concern me that Toyota will be bigger than GM. I don’t believe that since Toyota is NOT an American car company, they suck and America is always number one. It doesn’t suck at all, and they make great cars at great prices and they are both structurally sound and economically excellent (alliteration is awesome!) It’s because GM, as a result, will cut 30,000 jobs in the next few years to try and make up for their managerial failures. (Source)
It is not the workers’ fault that GM designs, markets and tries to distribute horrible disappointments. When they try to market an SUV with an American-tinged sentimental song called “Like A Rock,” or by having a country star sing about his favorite pick-up truck (Toby Keith), they don’t include the other 95 percent of Americans. Most Americans don’t care about towing a mobile restaurant/home because the waitress made some comment in passing about wanting to go to California. Or lifting an 18-wheeler by towing a system of pulleys with the truck and then driving the truck underneath it to show how stupid the stuntman must be. Or showing a man cliff jumping into his SUV as his way of going from his house to his car. Why do they continue to think SUVs have a chance to survive? Gas prices are too high for it to make sense to buy a gas-guzzler.

GM believes that their 2006 line of large SUVs should boost sagging sales, and that they plan on allowing flexibility between building SUVs and pickups. They believe they need to keep capacity for the vehicles that GM can sell at the greatest profit --the larger vehicles. With these announced closings, GM will be keeping its’ capacity of large sport utility vehicles and pickups intact, even though sales of SUVs have slumped in recent months in the face of higher gasoline prices.

Gas prices have continued to thoroughly SUCK. They're still up16 percent from a year ago, and both GM and Ford saw a MAJOR drop in sales of big SUVs and pickups in September and October. I’m sure they insist not all of that is due to oil prices, but they need to shift their focus from large SUVs and pickups to producing profitability from other vehicles.

The stock has tumbled some 40 percent since July. The three-month drop in GM stock has shrunk its market worth to about $12 billion, which is far less than the $19 billion in cash on its balance sheet. And its 9 percent dividend yield may seem tempting but is also a sign investors believe GM won't be able to keep paying $2 a year to shareholders much longer.

GM has seen its slice of U.S. vehicle sales slide steadily over the last 30 years, taking its share of the U.S. market down to 26.2 percent in the first 10 months of this year, compared with 43.8 percent in 1980.

As recently as 2001 and 2002 it had been able to stem the decline, posting slim gains, but the slide resumed in 2003. (Source)

So, back to the point. This all concerns me because so many hard working Americans will be out of a job. This is like “Roger and Me,” except I’m not as fat. It’s not only the 30,000 people who will be out jobs at GM. Even though, I should point out, that it will only be at most 26,000 who will need to find work after being hired in other car manufacturing plants, or change industries. It also drastically affects companies and factory workers that are related to GM. All the companies that make miscellaneous accessories in the car, they too will lose jobs. Someone makes the seatbelts, and the armrest consoles, and the car stereos. And with GM dropping their capacity, the other companies will be forced to cut back too, and that means losing more jobs there. That number is not computable to me. Maybe someone else can help me with that. Maybe someone else can help AMERICA with that.

Free To Be You And Me


Blogger scribe said...

I like in Michigan so I know whereof you speak...or write...or both...

My state has been decimated by the horrific economy and its over-reliance on the auto industry. in southeast michigan, where i live, the manufacturing base is the only thing keeping us from going under. It gave rise to the 3rd wealthiest county in the nation but I don't foresee the rest of the state faring well for much longer.

1/04/2006 5:09 PM  
Anonymous Anonymous said...

Yeah, I agree. But it's important to keep in mind that it's not only Michigan losing those jobs. There's also a plant in Oklahoma losing 3,000 or so jobs, as well as a few others. It's all of America that is being affected. Good story.

1/04/2006 9:52 PM  
Blogger scribe said...

I know, but we are the ones who set precedent for the rest of the country in the industry.

1/05/2006 12:45 PM  
Anonymous Anonymous said...

Looks like America will have to find something else it can eventually lose the title to being the best at...

Like shooting meth. We're still pretty good at that. I don't think people will want to export those jobs, though.

1/05/2006 1:25 PM  
Blogger scribe said...

I think they already have LOL

1/05/2006 1:31 PM  

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