The Last Wake-up Call for Ford, GM, and American Autoworkers.

The United States was once the world leader in the automotive industry, but it is now in deep peril. What was once the "Big Three" is now the "Big Two", and that may not be for long. Both Ford and GM are dangerously close to bankruptcy and Chrysler is no longer an American company.

For the autoworkers the situation may not seem so dire. We will always build cars in this country but many of them are being built by foreign companies.

When the foreign companies set up factories here they go to low wage areas, so the old autoworkers in places like Detroit, are out of luck.

Another problem is that the profits are going to Germany, Japan and Korea, and shortly will end up in Chinese coffers.

The Auto industry received a "Wake-up call" in the seventies. It chose to ignore it.

Before the Organization of Petroleum Exporting Countries cut off the supply of oil to the United States in 1973 -- by then imported oil accounted for some 40 percent of consumption -- warnings were being sounded at industry meetings and in trade journals about the crisis to come. The United States was at the mercy of OPEC, they said, and over the longer range the world was running out of oil.

The government began setting fuel economy standards, which were often in conflict with the air pollution and safety standards, which had to be met.

When OPEC created a sudden demand for small, fuel-efficient cars in the mid-'70s, the American makers were not ready with good designs.

The Japanese

We responded to the threat with Ford Pintos, Chevrolet Corvairs and other ridiculous mediocrities that the public would not buy.

By the end of the decade, Japanese makers were selling 2.5 million cars a year in the United States, close to one in every four units sold.

Detroit was reeling, but did not seriously attempt to stem the tide.

The situation is much worse today.

Chrysler, Ford and GM made 74 percent of the new cars and trucks sold in 1995, but only 57 percent of the new autos sold last year. ...

Between management, the unions and the American workers, we have managed to lose the shoe industry, the steel industry, the garment industry, the electronics industry and many others.

When are we going to wake up?

We are still the richest countries in the world; we have some of the best colleges and universities in the world. What is the matter with us? Have we lost our American ingenuity, our competitive spirit? Have we become too fat and lazy? Are we too complacent?

I don't know the answer to these questions, but I know if we don't change our ways we'll have no manufacturing industry left, and that will be a shame.

America can build good cars; we already do build a few. The good news is that the automakers and the UAW — deeply aware of the industry's crisis — are making changes. For example, the new Ford Fusion and Chevy Cobalt are promising models that have the potential to compete in price, quality and longevity with some of the Japanese best-sellers. And Ford's hybrid Escape at least begins to tap that growing market

We need some more visionaries like Lee Iacocca instead of a bunch of bean counters running the auto industry.

We need better management. And the unions, and the workers, better start working with management and stop their exorbitant demands.

The Japanese pay almost as well and have similar benefits, and manage without unions to hamper them. If they can do it, why can't we?

I don't advocate boycotting foreign companies that's not fair to the consumers.

Let's return as much as we can to the old ingenious, competitive America and give Americans what they want at competitive prices.

Wake Up America.

Many observers blame American management's focus on short-term financial performance with the U.S. decline in the face of long-range Japanese investment in zero-defect quality and technological excellence. American managers, they say, are more interested in their salaries and perquisites than in growth and investors are looking for the quick buck.

Why did Japan overtake and in many ways beat the United States at its own automotive game?

Many explanations have been offered. Management blames high labor costs in the United States, unions blame poor and greedy management. The unions gained credibility when Japanese makers began assembling cars in the United States and managed to obtain high levels of quality with American workers.

Now craftsmen are out of style, working with the hands is held in contempt, company loyalty is discouraged, wisdom in the form of older workers is junked and next quarter's results are perhaps too important. The evidence is that the MBAs had a lot more to do with America's decline than the UAW

By the end of the decade, Japanese makers were selling 2.5 million cars a year in the United States, close to one in every four units sold.

Detroit was reeling in the 70's. The situation has gotten far worse.

GM has 6,800 dealerships for the Pontiac, Buick, GMC, Hummer, Cadillac and Chevrolet brands and 438 Saturn dealers in the United States. Ford has nearly 4,400 Ford, Lincoln and Mercury dealerships. GM controls about 26 percent of the U.S. market, while Ford controls about 18 percent.

By comparison, Toyota alone has 1,430 U.S. dealerships and controls 13 percent of the U.S. market. They have commitments from dealers to open another 39 dealerships soon.

There are some bright spots. President Bush opened the door with his proposal to develop E85 which is a mixture of 85% Ethanol and 15% gasoline . Ethanol is made from corn and sugar beets. Both renewable resources. Ford and GM are both ahead of Japan in its development. If we do a good job and produce attractive, practical motor vehicles that burn E85 we can start to gain back some of our market share.

The use of Ethanol will also help to alleviate the problem of our dependence on foreign oil. It will be a boon to our agricultural industry and will overall benefit our economy by producing thousands of jobs

Americans, lets heed this Wake-Up Call. I'm sure we can arouse the spirit that once made America great. It's not dead it's just been taking a nap. It's time to wake up and smell the coffee. Let's make sure America doesn't become a second rate country.