Saturday, May 30, 2009
CNN: Detroit: "How the Wheels Came Off"
CNN tonight presented a one-hour special about the American auto industry, “How the Wheels Came Off”. It is auspicious since a formal bankruptcy of GM is expected Monday June 1. The latest Reuters story on the expected filing is here since the GM bondholders refused the deal offered by the Obama administration.
Early in the show, Ali Velshi and others discussed the idea that the American auto companies should have anticipated that oil prices would be unstable, and should have realized that foreign auto makers could win over customers by producing smaller, fuel efficient and dependable cars and keep the same customers for decades. In order words, the American auto industry was arrogant.
Then the program interviewed some auto workers and retirees. One union had lost two thirds of its membership. One of the female workers said that she had to do multiple jobs now. A male retiree said that he had lung cancer and could lose his health benefits at the end of 2009.
Then the show presented some classic cars at Columbus Circle (The Classic Car Club of Manhattan [link]) in New York City, including a Mustang. I remember that my first car was a Maverick in 1970.
Velshi also visited the Automotive Hall of Fame in Dearborn, MI, and showed the Model T from the 1934 movie "It Happened One Night".
The show compared GM and Chrysler to Ford, which seems to have done “better” partly because it focused on just one “brand” (Ford itself), which seems to helped it sell. That’s interesting to me since I have a trademark law blog and have noted that most companies defend all of their brands ferociously.
The show took the position that it is not productive to require American auto makers to make all their cars in the U.S. Globalization could still help the companies.
The program then showed the red Dodge Charger from the 1969 “Dukes of Hazard” show (and later movie with Sean William Scott). Another famous car is the 1967 Chevy Impala that Dean (Jensen Ackles) and Sam (Jared Padalecki) drive in “Supernatural.”
All three auto makers will have electric cars before 2011.
CNN does not yet have a special website for this program, but it has a link for the ten largest corporate bankruptcies ever, here.
Breaking News: Sunday May 31
General Motors will file for bankruptcy at 8 AM Monday June 1. AP/ABC News story by Kimberly Johnson, Tom Krisher is here.