It's all about perception

[Green_Monster]

I got this in my email the other day. Good reading and makes you think twice about what the media tells us.

 

Subject: AUTOMOBILE PERCEPTIONS

 

 

 

Every American auto dealer and company ought to spend big bucks and print

this letter as a full page ad!

 

 

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~`

 

 

December 1, 2006

 

 

American Perception Problems of the American Auto Industry

 

 

Ford and General Motors have taken turns besting the Toyota Camry in

quality surveys for the past two years, but if you talk to many

Americans - especially the ones who would never consider supporting

home-based auto companies - you'd never know it.

 

 

Last year, the Chevrolet Impala beat the Toyota Camry in initial

quality according to J.D. Power & Associates, and Consumer Reports

just announced that both the Ford Fusion and Mercury Milan scored

higher than both the Toyota Camry and the Honda Accord this year.

 

 

After the announcement, Ford's Director of Global Quality Debbe

Yeager commented "It's a perception gap," referring to the struggle

American companies have had overcoming the perceived and seemingly

untarnishable reputation of their foreign rivals.

 

 

Even as GM and Ford have accumulated award after award on vehicle

quality, you'd almost never know about such quality gains made by

American companies - or quality declines of foreign companies - by

listening to the media. Did you hear about it when the National

Highway Traffic Safety Administration announced that Toyota recalled

more vehicles than it sold in the U.S. last year? Probably not.

Did you hear about Toyota making an "elaborate apology" for their

"worrisome series of recalls" that has "tarnished its reputation for

quality?" Probably not. Did you hear about the Toyota senior manager

quote that stated "We used to do quiet recalls called 'service

campaigns' to deal with defects but we're not going to hide anything

anymore?" Such a statement suggests Toyota's past recall numbers were

probably much higher than we were led to believe, and they profited

handsomely by having a perception of higher quality than they

deserved. In Japan, prosecutors are looking into possible negligence

on the part of Toyota for shirking recalls for the last eight years.

How ironic. You probably didn't hear about that one either because

the American media doesn't like to bash foreign auto companies - only

American ones.

 

 

Then there's the mythical perception that foreign automakers produce

the most fuel efficient cars and that Detroit only makes gas-guzzlers

when the truth is that all automakers - including Toyota, Honda and

Hyundai-Kia alike - have allowed fuel economy to slide in the past 20

years since they all now sell bigger trucks and more SUVs. One of

Toyota's senior executives was even quoted in the Wall St. Journal

September 28 saying that both the Toyota Sequoia and Tundra "are big

gas-guzzling vehicles" and expressed "concern about the longer-term

prospects." These longer-term prospects about their admitted

gas-guzzlers are questioned because they know that Ford's F-150 and

Chevy's Silverado have led the pack in sales year after year.

 

 

Yes, gasoline has been getting more expensive - at least until

recently - but the fact that Americans continue to buy it in greater

quantities qualifies us as hypocrites for suggesting GM and Ford stop

building so many big trucks and SUVs. After all, GM and Ford are only

responding to demand as any company would and should if they want to

remain profitable in a cut-throat competitive market. According to a

Business Week survey, we Americans bought 10% more gasoline in the

first six months of 2006 compared to the first six months of 2000

even though gas prices rose 75% in that period. Maybe here I could

also mention that the Chevy Tahoe beat the gas-guzzling Toyota

Sequoia in quality surveys and gets better gas mileage to boot.

 

 

But what has happened since gas prices have been on the decline in

recent months? The Wall Street Journal reported a "slight" increase

in truck sales by American companies, as Ford Expedition sales were

up 41% and Lincoln Navigator sales were up 44%. The American media

even tries to restrain its applause for home-based auto companies by

referring to gains of over 40% as "slight!"

 

 

Perhaps the biggest perception problem is that American automobile

companies GM and Ford (Chrysler is now German-owned) squander all

their money on plants overseas and foreign automakers build their

factories in the U.S. Foreign car lovers will surely point to Kia's

plans to build its first-ever U.S. plant in Georgia, but they

probably won't mention that they received $400 million in tax

giveaways to do it, which translates into $160,000 per job. Among the

many benefits for the foreign-owned company, your tax dollars are

going to be used for road improvements surrounding the complex,

complete with flower beds and other beautification features. Hey, as

long as we're going to allow states to bid for private jobs with our

public tax dollars, we might as well make it look good, right?

 

 

And the foreign car lovers will probably also not tell you (or maybe

they just don't know or don't want you to know) that GM and Ford pour

more money into existing American facilities than foreign automakers

spend on new plants, usually with little or no tax breaks. GM has

already spent over $500 million upgrading two transmission plants

this year, and has spent nearly a billion dollars over the last

decade, for example, for facility upgrades in Texas. And what do GM

and Ford get for making their existing plants more efficient? It

isn't tax breaks. Instead, they get accusations of not being

"competitive" enough! Maybe here I should also mention that the

average domestic parts content for Kia is 3%, while the average

domestic parts content of Ford and GM is 78% and 74% respectively.

This means that buying a U.S.-assembled (or even foreign-assembled,

for that matter) GM or Ford supports more American jobs than a

U.S.-assembled car or truck with a foreign nameplate.

 

 

Fortunately for our benefit, the U.S. remains the overall global

leader in research and development, and a big reason for that is that

American automakers - according to the Level Field Institute - invest

$16 billion in R&D (Research & Development) annually, which outpaces

any other industry one could name. Admittedly, the Level Field

Institute counts German-owned DaimlerChrysler as an American

automaker, so Ford and GM's combined R&D contribution to America is

closer to around $12 billion. But who's counting, right? Certainly

not the American auto-bashing media.

 

 

Japanese companies do employ 3,600 American workers in R&D, but that

still leaves the foreign competition behind in the dust staring at

American rear bumpers. 3,600 sounds like a big number until you

realize that 65,000 Americans work in R&D facilities in the state of

Michigan alone. In fact, two of the top four R&D spending companies

in America as reported by the Wall Street Journal are - you guessed

it - Ford and General Motors. The other two are also American

companies: Pfizer and Microsoft.

 

 

Ford has recently made headlines as the American automaker with the

most challenges to its future, but these challenges certainly are not

because they "aren't making cars people want to buy." Toyota did

outsell Ford in July, but since then, Ford has reclaimed the No. 2

spot and has held it ever since. GM has the highest market share,

increasing over 2 percentage points from a year ago. So apparently

they can't be accused of not making cars people want to buy either.

Ford sales are also up in Europe, and Ford doubled their sales in

China, where GM has the highest market share of any automaker.

 

 

General Motors also reported a 3.9% rise in August vehicle sales

despite high gas prices and a supposedly slowing economy. And even

though Toyota reported record sales that month, they couldn't match

the non-record setting sales volume of Ford. GM's sales rose 17% in

October from the same month in 2005 and Ford sales rose 8% in the

same period. Ford also sits on $23 billion in cash, so they have

plenty of money to focus on and fix any problems.

 

 

And for all the talk about the lack of fuel efficiency of American

automakers, it seems three-fourths of all automakers failed to meet

Europe's improved fuel-efficiency standards intended to cut

carbon-dioxide emissions. Japanese and German automakers topped the

list of the study's worst performers, but according to an

environmental group's study, GM's Opel division and Ford both "come

out well."

 

 

In closing, I'll leave some encouraging numbers for those of us who

actually like to root for and support the home team. The J.D.Power

2006 Vehicle Dependability Survey reports that Mercury, Buick and

Cadillac (in that order) grabbed the number 2, 3 and 4 spots to beat

Toyota, Honda, Nissan, BMW and everyone else (except Lexus) in having

the least number of problems per 100 vehicles.

 

 

Perhaps someday the American media will give GM and Ford the credit

they deserve. And once they do, perception among the majority of the

American public will rightfully change. GM and Ford aren't only doing

what they should to make gains in the American market to deserve

American consumer loyalty; they're also doing what they should to

make gains in the markets of China, Europe and across most of the

rest of the globe.

 

 

_________________________________________________________

Roger Simmermaker is the author of "How Americans Can Buy

American:

The Power of Consumer Patriotism." He also writes "Buy American

Mention of the Week" articles for his website

http://www.howtobuyamerican.com/ and is a member of the Machinists

Union and National Writers Union. Roger has been a frequent guest on

the Fox News Channel, CNN and MSNBC and has been quoted in the USA

Today, Wall Street Journal and US News & World Report among many

other publications.

 

 

Roger Simmermaker, Author

How Americans Can Buy American

www.howtobuyamerican.com

 

 

[67ChevyRedneck]

Great read!

 

Now where's my Camaro

[asilverblazer]

 

:applause:, we need an applause.

[Clavin78]

I have to say...I believed the media hype of gas guzzling americans and better intial quality fpreign companies...but I learned a long time ago that all news is bad news...at least on the daily news

[SilveradoLAX7]

I like the article. I also like that he substantiates his claims with sources and citations. It is a lot harder to argue with fact than it is opinion.

 

-Jay

[Elwood 2000]

You probably didn't hear about that one either because

the American media doesn't like to bash foreign auto companies - only

American ones.

 

Sounds like their political style of reporting spills over to every other area of reporting. I don't trust the media one bit. They tell you what they want you to hear and sadly, most Americans only take time to listen to a little bit of what they have to say instead of doing quality market research. Those that trust in Consumer Reports are making a grave error as well. Consumer reports are vehicles that are tested by them, their staff, not opinions from owners. I read their vehicle report cover to cover last year and it was funny, the same good things and bad things about two different vehicles were printed, but one was praised and given the "best buy" logo and the other one was rated as dog food.

 

I think some of the designs the American companies are coming up with are good looking and the quality is improving, but they are not producing perfect autos yet. All vehicles have problems, but Ford and GM being very honest and forthright about it has cost them, sadly.

[Green_Monster]

All vehicles have problems, but Ford and GM being very honest and forthright about it has cost them, sadly.

 

 

One phrase comes to mind...."No good deed goes unpunished"