On the End of the American Auto Industry

Blitz Magazine, March 2006

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The other day, I was sitting in a long line of traffic. I was at the top of a hill and could see all the cars below. I noticed that, out of 50 or 60 vehicles, only three were not Japanese or German. The US was represented only by a Hummer, a big lump of a Cadillac and an ancient Buick. All the rest were foreign. As I continued to drive around Vancouver that day, I kept an eye out and saw the same thing on every street, in every parking lot. Japanese, German, some Swedish. Lots of Jaguars. And everywhere, SmartCars. Nary an American vehicle in sight.

Meanwhile, the news on the radio was about how Ford and GM are on the brink, and I’m thinking “Well, duh.”

The mantra for big marketing is all about knowing consumers, knowing what they want, and giving it to them. This is nothing new. But American car-makers—who rank among the largest retailers in the world—have never done this. The American auto industry has always given consumers what it wants them to have. Consumer research may have been conducted, but it was ignored. Ditto all research into what the competition was doing. The message from American auto-makers has always been the same: “Here’s what we’ve built. Buy it.”

If I were the president of, say, General Motors, I would have looked at Great Britain, whose citizens pay some of the highest fuel prices in the world and have never wanted anything but the small and zippy. I would have seen the same thing across Europe and thought ‘Hmmm. Maybe the big car is about to do the way of the dodo.’ I would have listened to trend analysts—not American auto trend analysts, but energy trend analysts. I would have seen what the Japanese saw long ago: a growing need for smaller, more fuel-efficient cars with all of the options and comforts. I would have said to myself: ‘Look at how successful those Japanese manufacturers are. Maybe we should do the same thing.’

Well, that didn’t happen. Instead of giving consumers what they really wanted out of a vehicle—fuel-efficiency, safety, reliability etc., American car-makers said: ‘Oh forget the reality. Let’s look at consumers’ cultural aspirations, create vehicles that fit with their idealized self-images and appeal to their egos, and then market the hell out of them.’

So, at a time when roads are true danger zones, and when most couples wouldn’t dream of having more than two children, American car makers produced SUVs—gas-guzzling vehicles that everyone knows are unsafe. Then they marketed them as family essentials. At a time when drivers are increasingly distracted by cell phones and fast food, American consumers got vehicles with entertainment systems. In an era where commuting time can run up to three hours, Americans produce longer vehicles (longer vehicles increase commuting time for everyone).

Did consumers ever indicate that they wanted this? No. But the marketing worked. Until reality sunk in. Those vehicles are no longer desirable. There are millions of them out there, and no one wants them.

auto1Pick-up trucks are only needed by tradesmen. Yet we’re now seeing massive pick-up trucks driven by executives who happened to respond well to hearing Bob Seeger sing ‘Like a Rock.’ For the under-endowed, there’s the Hummer. Meanwhile, the US government is so desperate to find sources of oil that it has gone to war and is ready to plunder a northern nature preserve for a three-year supply. Chop logic.

If you look at the advertising for German cars, the emphasis is on performance and status. If you look at the advertising for Japanese cars, the emphasis is on reliability, safety, stability, comfort—and fun. If you look at the advertising for American cars, the emphasis is on all the snappy things you can fiddle with inside vans—to create toy bins and space for baby carriages. Please.

And speed—we’re still stuck with those tired old commercials showing cars driving very fast along twisting roads. Meanwhile, public tolerance for speeding is at an all-time low. Fines are way up, California drag-racers are going to jail—a Vancouver man was recently deported as a result of a fatal speed-crazed crash. Speed and recklessness are, like, totally yesterday.

The major shareholders of American auto manufacturers have never done anything to remove board members or CEOs. Now all’s lost. And you have to wait in a very long line to buy a SmartCar or a Prius; and a 2002 Toyota Echo costs $17,000—if you can find one.

Big Auto wasn’t paying attention. The lesson that everyone can learn from that is that communicators have to be smarter and make more of an effort to predict the future. We have to watch, listen and learn. We have to hear the ideas in our own heads, and listen to those of others. And we have to be better communicators.

We are in the Age of the Internet. And the Age of the Entrepreneur. Long-term success now depends on communicating, fulfilling needs, listening, providing great products and services at fair prices, and giving clients and consumers what they want and need. Otherwise, adios.

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