General Motors’ problems continue to plague them with another 718,000 recalls announced today, contributing to their profits woes. It all started 17 years ago, but caught up with them earlier this year. If these latest troubles put them out of business, they can only blame their own top management of the 1980’s and 2000’s.
I was raised as a General Motors admirer, and droves mostly GM products until the very early 1990’s. I can only guess that my preference for GM products was because my older brother – who doubled as my dad after our dad’s death when I was three – worked for a GM and later a Pontiac dealer back in the 1950’s and early 60’s. I hung around with him a lot at those dealerships. So it only made sense that I favored GM products. But that all changed in the late 1980’s.
During that decade I owned 4 different Chevrolet products: A Suburban, an Impala, a Celebrity and a Beretta. To say they were all pieces of junk would be a gross understatement. From bumper to bumper, they completely fell apart inside and out, with one burning to the ground due to an engine overheating problem GM could not or would not fix. It would be more than 10 years before I found out why all those vehicles were junk.
Although GM’s current debacle began in 1997 with the ignition switch design, it only came to light this year. For most of the 2000’s they continued to use switches they knew were faulty, as well as other inferior automobile components. In a phrase, they built crap and pawned it off on the public — just as they did in the 80’s.
Around 1999 there was a 2-hour documentary on the history of General Motors. I can’t recall if it was aired on the History Channel or NatGeo, but I think it was the latter (I have diligently searched online for a copy). But I watched it with great interest. In an interview for the documentary with the then-current CEO of GM, he was questioned about the fiasco of the 80’s. I will never forget his response when he was asked about the ‘why’ (not recalling his exact words, I paraphrase): ‘If GM had not done what they did there would be no GM today’.
In other words, GM made a conscious decision to design and build every vehicle in their lineup as a piece of crap, then sell them at quality prices to an unsuspecting public in order to stay in business; a “screw the commoner so we can get rich” approach – a mentality most of corporate America possesses today.
In 1980 GM realized their first loss since 1921. Roger Smith became the CEO the following year. Evidently he determined that the only way the company could survive was to build crappy automobiles and sell them at prices competitive to top-quality Ford’s and Chrysler’s. Because Smith made such a mess of GM, he was rated among the “Worst American CEOs of All Time”.
GM’s problems didn’t begin with Smith – he just multiplied them. In the years leading up to the 1980’s, GM “tested the market” with sub-par components. Being a gearhead, two engines come to mind. The worst was GM’s attempt to put a diesel engine in their full-size Oldsmobile. The engine was nothing more than a hybrid gasoline engine, as many of their 350cid gasoline engine parts and design were used in the diesel. Needless to say, it was a complete failure, leaving a sour taste for diesels in the consumer’s mouth which had a negative impact throughout the diesel engine industry. The second was their “8-6-4” engine for their Cadillac. The idea was to use all 8 cylinders in their V-8 only when it was needed, then drop back to 6 cylinders and eventually to 4 cylinders, at certain speeds in order to save fuel. Another complete failure.
I haven’t owned a GM product since the Beretta, and I never will no matter how good a product they may build. I refuse to reward a company who consciously did what they done.
In many ways I would be saddened if GM went completely under. I’m old enough (70’s) to remember the “glory days” of automobiles (1950’s & 60’s) which included GM products. And my heart would be even more heartbroken to see tens of thousands of working men and women – who had nothing whatsoever to do with the greedy decisions – lose their jobs. But if GM failed, and the business world would admit to the truth of why, I certainly wouldn’t lose any sleep over it. Sadly, those at the top who made the decisions leading to the potential demise of GM have either already walked away, or will walk away, with their fortunes. They certainly won’t suffer financially.
Hail to unfettered greedy capitalism!