Y2W29 - Christmas is coming... and a 'short' thought on the automotive industry
Our (most Ellyn’s) last couple weeks have been spent much like many of yours, intense investigations and research as to what is the best gift for each child and where it can be found at the most reasonable price. Our quest is a bit more complex than most as Ellyn frequently balances the benefits of purchases from either Germany, England, other nearby European nations, or the United States against each other calculating shipping costs, exchange rates, tax rates, and other economic considerations. She has become a real pro and as a result, she spends the holiday season frazzled and stressed while I remain cool as a cucumber having every confidence that she will deliver once again.
El took a few pictures of Lleyton with Bay. As some probably know from previous posts or phone conversations, Lleyton is only truly happy if someone is holding him. He is not a respecter of persons, he simply wants to be held. We’ve introduced him to his Bumbo chair the last week or so. J.R. bought it for him when he was visiting this last summer and he and I were traveling in the Netherlands. So far it has been a nice change, but we’re hoping that he continues to go into the idea of a bit more independence.
This last week, I had the traditional end of the year Christmas night out with colleagues from work. Ellyn will finally get her turn to go out this week when she gets to dine with her friends for book club. This seems to be the primary route for us to find different restaurants in the area – going out separately with friends/colleagues. Perhaps we’ll get back to going out together in the next few months. A newborn kills the babysitter/night out gig. We hit a great restaurant Weiss-Bräu near Barbarossaplatz on the west side of Köln. He are a few pictures with me and my German and English friends.
This weekend, our focus was to find our Weihnachtsbaum (Christmas tree). The most traditional German families put up their trees on Christmas Eve. While I gave a little thought to following the local tradition with my parents on their way, but the kids were terribly excited to put it up so we stuck to our own traditions and not only picked it out, but cut it down, brought it home and put it up. After last years +3 meter (10 foot) tree, we dialed it down to 2.5 meters (8 feet and change). Check out the picture on the left, the position of the six bulbs relative to one another is the clear result of unsupervised 3 and 5 year old decorating.
Lastly, while I don’t mean to turn Ellyn’s blog into a political forum with links to the Wall Steet Journal Editoral page… oops, or the American Enterprise Institute or the Heritage Foundation pages… oops again, I do think a couple thoughts about the Automotive industry are warranted. These thoughts are not intended to start a debate or conversation (especially on our family blog). If your interested in chatting, give me a call on our local Ann Arbor phone number, it rings in Germany.
Note: if Ellyn thinks that I’ve gone overboard, this might be my last ‘guest’ blog post. There will not be any blog polls to vote me off the island. I hope…
First of all, not all the domestic automakers are in the same situation. While Ford has been more successful over the last several weeks in telling it’s story, the effort admittedly got off to a slow start as the initial strategy when the automakers went to Washington was to portray a united front. The second time around, it was clear that Ford needed to articulate it’s position. This link was set up by the company to tell the Ford Story.
The highlights include information on how the company moved decisively a couple years ago to change it’s model mix to be more diverse and balanced, restructure aggressively (we’ve made major changes to overall employment), and to go to the credit markets in 2006 to fund our restructuring. our family is a example of this change in direction. It was a year and a half ago that we moved to Germany as part of that intiative. The other message that is being told is the clear progress that has been made on a couple fronts:
First, Ford’s quality has made huge strides and is now recognized by independent firms J.D. Powers and Consumer Reports as being better than the other domestic automakers and on equal footing with Toyota and Honda. For years when asked about this topic, a feeling of uneasiness would come over me as I prepared for a story about how a particular Ford product didn’t live up to expectations. It’s nice to stand on absolute solid ground and look forward to those discussions, and anticipate positive comments when the topic comes up.
Second, Ford has become the clear leader in Safety within the automotive industry. Ford has more government rated 5-star rated vehicles than any other manufacturer domestic or foreign.
Finally, we’ve got some great new products coming with industry leading technology that address the needs of a wide range of customer priorities. For those of you who are part of the growing environmentally aware drivers, the new 2010MY Fusion with Hybrid powertrains available in the next month or so, beats the Camry and the Accord in fuel economy and other key attributes. The 2011MY Fiesta, which is the first of several new car and crossover products we’ll be bringing over from Europe, will be available in a little over a year. Check out the brillant and entertaining Top Gear program review of the Fiesta. The new 2009MY F150 truck, it is the best truck on the planet – bar none, and the new 2010MY Mustang also available soon. Hopefully, I’m not sounding too much like a commercial.
Now, if you’re brave enough to check out my ‘latest in conservative/libertarian thought’ links above, you’ll find a drowning quantity of ‘let the GM and Chrysler restructure in bankruptcy’ articles. On this particular topic, I find myself breaking from the dogmatic approach of the authors ,and disagreeing with those that believe bankruptcy is the correct answer.
It is undoubtedly true that major financial restructuring is needed, and traditionally this is best done within the providence of bankruptcy, but this situation brings a few unique conditions that are substantial enough to warrant a change in thought: 1) The potential downside impact of the economy due to the size of GM and Chrysler is massive; 2) The products being sold are the second most significant purchase an individual will make in their lifetime - are customers truly going to feel comfortable buying from companies in bankruptcy? 3) The overall condition of the economy is in a clearly fragile state – is this a risk worth taking? 4) As a country, we need to have engineering and manufacturing capabilities that the American owned domestic automakers provide. Yes, foreign automakers do manufacture in the U.S., but they do not design, research, or engineer their products in the U.S. to a level anywhere close to that which GM, Ford, and Chrysler. Their research and engineering that takes place in their home countries often with the help of their home governments. This is knowledge base is a key strategic enabler to energy independence.
It’s clear that the near deal that was almost brokered last week in the Senate addressed the major cost roadblocks to long term viability. If both the Republicans and Democrats didn’t have the White House as a backup plan, I’d bet that a deal would have been made. Here’s hoping that the White House takes the ideas that were on the table last week and allows the restructuring of legacy costs and debt that is required to take place without the spectacle and risks of bankruptcy.
Among the voices for and against the idea that customers will or won’t buy cars from companies in bankruptcy, one thing is for sure: No one knows the answer to that question for sure… seems risky to me.
I like the eloquence of Thaddeus McCotter.
Sorry for the rather serious topic. Serious times in the auto industry.
We wish you a wonderful holiday season.
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