After the Bailout

Thomas Friedman, the author and New York Times columnist, got it right in a recent column.

He wrote that "over the years Detroit bosses kept repeating: 'We have to make cars that people want.' That's why they're in trouble. Their job is to make the cars people don't know they want but will buy like crazy when they see them [italics from original article].

If Detroit's management recognizes the validity here, they could begin the rebirth after the bailout. When was the last time you turned to a Detroit-designed and engineered car and proclaimed, "I must have one of those!" Many is the time buyers have said "I must have a new car" and turned to other marques for their choice. Or worse yet for Detroit, they've said "show me you lowest price or best lease deal." In effect "I'll rent this car for the next 2 - 7 years" instead of investing in ownership.

If hybrid cars are your thing, a Chinese manufacturer now sells a $22,000 plug-in hybrid that will get 80 miles range on a charge and then a gas engine kicks in. For a lot of driving situations every day, 80 miles will be enough to run on electricity alone.

If, as I do, you live in northern New England, where power outages from ice and snow and wind storms are all too common, you might want to hold on the "plug in" until the electrical grid is more robust. That said, for fans in China they now have a car that they feel as though "they must have." So how come GM can't get the Volt out until at least 2010?

As Friedman wrote in yestersday's Sunday New York Times, "Walk through a lot of college campuses. You don't see many Buicks." Memo to GM: your future buyers, the ones who will fund your bailout through their taxes and lost savings, aren't interested in the marque you've identified as part of your "core product line.'