| Written by Tony Moorby, on 03-16-2010 01:03 PM |
Seneca, the Roman philosopher, said, “Luck never made a man wise.” So at the recent meeting of the NAAA, IARA and Ed Bobit’s CAR conference in Las Vegas I decided to attend all the meetings and not prowl around the casinos. A lot of
people must be of the same
volition these days as you could have fired a cannon through the tables and not hit a living soul. Speaking of soul, I was graciously treated to dinner by some friends at a posh restaurant at Caesar’s Palace and chose the Dover sole – an English addiction and it’s good for you. The price was $55! I have to say it was absolutely delicious and the food was only bettered by the company. I still suspect that the casinos have found other ways of digging into our pockets. Wasn’t it Steve Wynn who said, “If you wanna make money in a casino, own one!” Remember the days when you could gorge yourself on a three-course steak dinner for $12.95? You wouldn’t want to be seen dead in the neighborhoods where those are still available.
It’s a shame that Las Vegas and more particularly Henderson, which was one of the fastest growing cities in the U.S. a few years ago, have suffered enormously in this recession. Now it’s No. 1 in foreclosures. But Las Vegas has the innate ability to reinvent itself. Ten or 15 years ago it was a family destination – not that that ever made sense to me – but now it’s back to Sin City, only more so. You need no further evidence than the drive from the airport and the billboards will convince you that any appetite for the sexy and even sleazy can be sated. I remember when people used to dress nicely for a casino visit. Now it verges on a competition for the grungiest attire
accommodating every conceivable shape and size. People- watching is vastly rewarded with a sea of humanity in every guise and get-up and sadly, not very good-looking these days.
I’ve been to Vegas more times than I’ve had hot dinners, it seems and this time I didn’t see the outside of the hotel. It didn’t matter – it was chilly and they’re all the same anyway. The camp and ersatz novelty wears off pretty quickly and I’m admittedly not a very good gambler, although Lady Luck has been cheerfully beneficent sometimes.
This time the reward was in the convention meetings. For a start it made all kinds of sense for the three organizations to get together – we always discuss the same subjects anyway – so it was cost effective. The
audience wasn’t diluted by three opposing and costly meetings. The agenda, if at first confusing, was an all-encompassing round up of the industry in a time of flux. There was no self-indulgent feeling sorry, more a sense of looking forward to shrugging off this low cloud of gloom. Even Dr. Ira Silverman, NAAA’s analyst, had a bullish forecast of blue skies ahead in the not-too-distant future.
For me, a lot of sessions cover familiar ground, having been on this circuit for longer than I care to admit but there’s usually one that makes the trip worthwhile. This time, it was the very first meeting at the IARA breakfast when Donald Foy from Manheim’s Drive Center (a facility of which I am achingly jealous) addressed the changes that
‘social media’ will bring to us or should I say is already bringing to us. There were so many ‘light bulb’ moments in his terrific presentation that I sincerely felt that I had learned something of great significance and, had I not attended another session, my time was still well-spent by coming. If you missed it, you missed the best of the show!
There was lots of time for
social hob-knobbing and that’s always important. This may be a huge industry but it acts like a small business. So staying away from the tables paid off anyway. As an old Swedish expression goes; “Luck never gives, it only lends.” But I get to keep this knowledge.
|
|
|
 |
| Written by Tony Moorby, on 03-02-2010 01:56 PM |
Henry Ford said, “If I had asked people what they wanted they would have said ‘faster horses’!”
There was a mind whose technology and engineering changed the world – a “game-changer” in today’s parlance. He had an unwillingness to
accept the status quo and asked, “Where do we go from here?” But even he didn’t forecast the massive volume of sales the Model T was to make. Eventually coming up with the mass-production technique, not only did he achieve the volume of sales
required to meet the demand but the practice gave us standard applications of the process of building cars to the engineering tolerances of the time. Even the largest recession in history didn’t halt the progress of the automobile. But perhaps things were simpler then.
That’s easy to say now, in retrospect, but this has been the most confusing time of my life. To a great extent, the car business cycles were a bit like the tides – things happened in a fairly predictable sequence.
Not any more. No longer the rising spring market, no more new model introduction times, no such thing as three-year-old trade-ins that are all paid up, salary levels that rose nice and steadily for an increasingly well-off population, career ladders with a clear view of the top and what it took to get there.
Looking back it was all wonderfully American – big, fat, squishy cars that were made only for this market along with equally soggy pick-up trucks! Fodder for a market that knew what to expect and really didn’t demand that much more – “Bring me another hamburger, Mac!”
Even now they’re the same no matter where you are.
The hamburger’s probably the only predictable thing left in a time when there are so many questions with absolutely no solid answers. Will I have a job tomorrow? Will I find a job in three months? Can I send the kids to college? How will I pay for it?
Heck! Can I buy the groceries this week?
Never mind, can I buy a house? It’s should I try and make another payment or give it back to the bank?
And then there’s the question of credit. Or should I say the myriad of questions about credit. At heart I’m a right-wing conservative – what the Brits would call an old
fashioned Tory – over here that’s about four clicks to the right of a real Republican who would be prepared to admit it and they’re as common as hen’s teeth. I say this because I
believe in the capitalist system – reward those that take the risks and employ the masses – it’s the Great American Way.
But in all good conscience, someone has to explain how a bank which used our money to pay off their borrowings from DeutscheBank and are now back making billions coolly pays some lucky windfall winner of an executive, who probably can’t spell mortgage, millions of dollars in bonuses.
No-one created any wealth here except for themselves. Meanwhile their affiliated credit card companies can tell you to assume the position.
If you’re lucky enough to
escape a reassessment of your credit-worthiness your rates may rise arbitrarily. Now they have to tell you how many eons it’ll take to repay the borrowings at minimum payments (which will be a huge eye-opener to many) one may say that they’ll pay the whole lot off, give themselves plastic surgery and cut it up – now the bank’s going to charge you a fee for lack of use. This is getting like the airlines – charge more, get fewer customers, so charge more.
Add to this our role in a global economy and the plot thickens. Even if we were to get our own house in order (our grandkids might achieve that) – machs nicht.
A small member of the
European Union like Greece will send everything into
another tailspin as they fight over whose going to pay what to whom and when.
If I’ve managed to convince you that these are the ramblings of an uncontrolled mind, then I’ve succeeded. All I need is a faster car – I mean a faster
Internet.
|
|
|
|
|
| Disconnected Jottings from Tony Moorby 2.15 |
| Written by Tony Moorby, on 02-10-2010 11:54 AM |
The bigger they are, the harder they fall.
It would be too easy to adopt a gloating position like this when applied to Toyota’s current problems with recalls resulting from manufacturing defects. In reality, recalls are as common as a cold. This one’s big not only because of the volume of vehicles, but also because it involves safety issues following the
harrowing death of a California family. It’s also a big deal
because it concerns a
manufacturer who has hitherto been considered a paragon of virtue when it comes to quality.
I think it’s fair to say that more recalls have been announced, voluntarily or otherwise, by our own manufacturers. Also, this particular gas pedal attachment was made here. Now, I know it was made to Toyota’s specifications but the footprints plod heavily through our own backyard and track mud all through the living room.
In a way, I’m glad it wasn’t GM’s or Chrysler’s problem – can you imagine the furor of taxpayers seething after bailing them out? It certainly comes
at a time when the industry doesn’t need any more wounds to lick.
Do you remember the Ford Explorer-Firestone Tire debacle? It was made excruciatingly worse by the finger pointing at one another with two PR firms running away from each other and not addressing the problem head-on. This was crisis management at its worst and prolonged the perceived product damage unnecessarily.
Engineering has improved both brands, although the tires are now marketed as Bridgestone.
To Toyota’s massive credit, they have grabbed this potentially runaway train by the
caboose. The media, of course, is all over it like a cheap suit – some calmly and coolly reporting the facts, others histrionically raising the temperature in an effort to gain rating points.
Akio Toyoda himself apologized to the world. I can’t
remember any American manufacturers’ bosses taking this self–deprecating step.
What has resulted is a crisis management team, coordinated on a worldwide basis, from designers, technicians, makers, distributors and dealers, parts and service departments, advertisers and public relations companies as well as customers, the whole numbering in the thousands and costing around $4 billion to put things right.
Helping them is a tremendous goodwill capital investment in its existing customer base that, even under these withering
circumstances, will take a great deal to erode. They have also committed to study, and by this I mean build centers at every stage of product development from design to delivery, to ask if there are better ways to do things and to stop this kind of thing from happening again. It’s also an effort to immediately reestablish internal pride in the company and what it produces for its customers, thereby
underwriting future loyalty to Toyota. They’re not just telling the world that they screwed up and admitting as much, but they are getting out the economic birch twigs for a thorough whipping. Thank goodness they stopped short of committing “Seppuku”!
Whilst new Toyota sales have been put on hold, their used cars have followed suit, even at the wholesale level at the
auctions, as dealers are arranging to work overtime in the service departments. I’ve even heard of some working 24/7 to keep customers happy. One supreme irony is that some of their cars can’t stop while some of the others can’t be stopped. In this case the ABS software would appear to have a glitch, in that it can’t read sharp undulations under heavy braking. Don’t you love computers!
In this day and age of instant communications, word about these things doesn’t leak out slowly any more. It’s there in an Internet downpour. This new phenomenon is called ‘viral’ communications and it can be a marketing boon or provide a calamitous bust to those who don’t know how to handle things in adversity. In this case I think Toyota has learned some valuable lessons but has also shown the world that crisis management, properly handled, can contain the worst events and even come out the other end looking pretty good.
Bearing in mind the hugely loyal customer base, perhaps this is a case of ‘big is beautiful.’
|
|
|
|
| Disconnected Jottings from Tony Moorby 2.1 |
| Written by Tony Moorby, on 01-27-2010 04:34 PM |
An old Chinese proverb says, “A man who chases two rabbits loses both!” This year’s Detroit Auto Show underlined how many different technologies are being applied to the propulsion of the automobile.
Firstly, size matters. GM is developing a sporty little Aveo with styling cues from motorcycles and looks just aggressive enough to appeal to young
buyers. Ford’s Focus gets a hopped up looking revamp, much in the European style. It’s taken forever but the efficient, taut little cars with lots of
performance are starting to
replace the old American flabbiness. The new Buick concept should take new owners’ age grouping down by about twenty clicks. Noise reduction technology, better suspension systems and lightweight materials are starting to make the small car actually exciting rather than some cheap and cheerful buzz-bomb that would beat your brains and eardrums out.
Then there’s ethanol. This needs some serious work. The last vehicle I was in with its systems running on this ersatz fuel was a Suburban that wouldn’t pull the skin off a rice pudding! The “check engine” light was on and it ran as rough as a 1982 diesel Cadillac Deville. I really question this as a serious, long-lasting alternative. If you want the same performance as the gasoline equivalent, then your foot is through the floorboards and the thing guzzles so many ears of corn the cattle farmers can’t get enough feed at reasonable prices so the cost of your filet mignon or flank steak goes through the roof. You didn’t save at the pump, you had to go to the service department and the supermarket got deeper into your pocket. You don’t have to be a rocket scientist to figure that this is not a great deal. I’ve said before that economics is just like physics; every action has an equal and opposite reaction.
What about battery technology? Again, there’s a long way to go. There are a couple of small makers getting terrific performance from cars that look (and probably feel) like a flying hammock but the weight of the batteries alone, to fuel a family sedan, would be an impediment to progress. Plus, an impromptu ride in the countryside, not knowing how many miles you might go, is out of the question – there aren’t many places to plug in around the hedgerows! So infrastructure is a huge deal here. Manufacturers would have you believe that the emissions from battery cars is just good old H2O – balderdash! How many tons of coal or other fossil fuels were burned to
create and save the electricity in the first place? How many Kentucky and West Virginia mountain tops shall we strip to get the coal to burn? Again, don’t hold your breath for some silver bullet soon but we have to keep trying.
Hybrid drive systems seem to hold the most promise for the immediate. I have to admit considerable ignorance as to workings of this gadgetry. There may as well be a hamster running in a spinning wheel for all I know. The big question is if one goes wrong out of warranty, what’s the cost? How do you value a seven-year old vehicle with one of these systems? Is there some value matrix for utility left in a hybrid? We’ll let the guide books figure that one out.
It looks like internal combustion is still the most efficient and getting better, although I still hanker after a Cadillac CTS-V with a stick. My wife had one. It was the lustiest, most
lascivious thing on wheels with an exhaust note that tore at your very being. Let’s hope we can always enjoy these dalliances and indulgences.
Anyway, bravo for the New Year and all it may bring. May our tax dollars help those in charge to chase the right rabbit.
|
|
|
|
|
