[7 May 2009]
Like most people in Corporate America, back in my suit-guy days I attended my share of ‘change management’ seminars (corpo-speak for a half-day’s brainwashing on how getting schtupped by the boss is good for you). Invariably the session leader would make a statement about how the railroad companies lost out to the private automobile in the early 1900s because they couldn’t think outside box: they thought they were in the train business and didn’t realize that they were in transportation business, the refrain typically went.
I couldn’t help but be reminded of this while witnessing the apparent implosion of the American automobile industry from a vantage point here in the town soon to be formerly known as the Motor City. In the local media and in conversation, the debate has usually been for or against the need for a domestic automobile industry not what system of transportation might best suit us for the 21st century. That mindset ruled at the 2009 North American International Auto Show held this past January in downtown Detroit. Regardless of how ‘green’ the energy source, the assumption was still the single-family car as the only thinkable solution.
This myopia continues to be on display in the “Total Confidence” marketing campaign from General Motors announced at the end of April. Take the new TV spot from Chevrolet that compares its products with foreign rival Honda. Featuring Football Hall of Famer Howie Long, the ad trumpets the fuel efficiency of various Chevy models vs. their comparable Honda counterparts. The spot ends with a smirking Long proclaiming ‘However, Honda does make something we just can’t compete with’ and the video cutting back to reveal a lawnmower.
The cluelessness operates on several levels. First, Honda is still making money even in the worst economic environment in generations and its stock is worth more than 16 times GM’s, so they can’t compete there either. Second, though a relatively modest component of total earnings (just over 3% according to company sources), what Honda calls ‘power products’ is still a profit center, which is more than you can say for most any GM division as it reels toward bankruptcy. Third, what’s so bad about making a great lawnmower anyway? Does GM have something against cutting grass or what?
It turns out that GM is in the car business. These days, even in Detroit, which must have the shittiest public transportation system of any major city in America and leads the nation in job sprawl, record numbers of people are riding the bus according to the regional transit authority. A lot of people (me included) aren’t using motor power at all whenever possible and are instead riding bikes. So why are we throwing money at car companies when we could be investing it in the next generation of transportation? Perhaps the change-management gurus should chew on that one.
GM pitchman Howie Long tries to garner consumer confidence