With the Big 3 U.S. Automakers circling the drain, we figured we would throw our hat in the ring and offer up some suggestions.
And no…none of them involve sticking your head between your legs and kissing your @$$ goodbye.
1. File chapter 11 bankruptcy.
Suck it up and file bankruptcy. During the restructure, fire some people, adjust some salaries, and trim the fat. Take the $25 billion dollars of taxpayer money and ensure that your workers get the retirement and health care benefits that you have promised them.
And honestly, I don’t care how hard your CEO works or how stressful the job is, an $8 million dollar salary is ridiculous when you are asking the federal government for a handout. He already gets free cars, maintenance, and repairs (which are normally 15-20% of a household budget). You could take $7 million of that and start saving your company.
2. Get rid of the United Auto Workers Union.
Workforce unionization is so 1935. Historically, labor unions fought to establish safer working conditions and better wages/benefits for it’s members. Having met those goals several decades ago, they have unfortunately become self-serving money funnels that drive up the cost of doing business. Union contracts don’t allow companies the flexibility they need when times are tough. And times ARE tough, if you haven’t noticed. You can imagine how having to pay someone $30/hour plus benefits and retirement to install tires significantly increases the cost of making cars. Other industries have layoffs, reduce benefits, nix bonuses, don’t give raises, etc. This is the reality of doing business in a global economy.
Following the bankruptcy, make your salaries competitive, but don’t hire any one that is union. If people need the job badly enough, they will drop their union memberships and take what you are offering.
3. Stop making shite.
Reputations always hold a modicum of truth and US automakers have a reputation for building cheap, unreliable cars. From 1990-1996, Chevy even had the balls (or sheer lack of imagination) to make both a minivan and a car named “Lumina” – that both sucked. If you asked anybody, I mean ANYBODY, to name a reliable car, Honda and Toyota will be the first words out of their mouth.
Fixing a bad reputation is a monumental task and the Big 3 need a crash course on reputation management. Step 1 involves recognizing your shortcomings (quality, innovation, foresight, leadership, dealerships, etc.) and doing everything in your power to rectify those issues. If those shortcomings consistently involve bad management decisions, then maybe the stockholders need to take the reins and clean house. Click here to continue reading…
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