{"id":1292,"date":"2009-01-04T11:16:52","date_gmt":"2009-01-04T16:16:52","guid":{"rendered":"http:\/\/www.jasetaro.com\/blog\/?p=1292"},"modified":"2009-01-04T17:14:56","modified_gmt":"2009-01-04T22:14:56","slug":"wsj-let-detroit-build-profitable-cars","status":"publish","type":"post","link":"https:\/\/www.jasetaro.com\/blog\/2009\/01\/04\/wsj-let-detroit-build-profitable-cars\/","title":{"rendered":"WSJ: Let Detroit Build Profitable Cars"},"content":{"rendered":"

I’m doing a little catching up this weekend and trying to read all the two dozen or so articles I bookmarked over the past couple of weeks.<\/p>\n

One of the items I bookmarked was Holman W. Jenkins Jr. December 31st Op Ed piece in the Wall Street Journal “Let Detroit Build Profitable Cars<\/a>”<\/p>\n

In the continuing battle over Detroit, UAW chief Ron Gettelfinger doesn’t seem to get the picture. Let’s help him.<\/p>\n

With shareholders virtually wiped out and debt holders taking a massive haircut, labor is the only stakeholder with anything left to lose. Even a friendly Obama administration will have to acknowledge this. But there is an alternative that would at least take some of the pressure off wages and benefits — and that’s freeing auto makers to build cars for a profit rather than to meet regulatory mandates.<\/p>\n

Like all regulatory schemes, Congress’s hallowed Corporate Average Fuel Economy rules froze in place a conception of the auto industry as it appeared to the simple minds of Congress in the early 1970s, when three manufacturers dominated the U.S. market, making full lines of vehicles. Today, more than 25 companies sell vehicles here, and the corollary of such diversity, normally, is specialization.<\/p>\n

The Big Three, left to their own devices, would surely specialize in those vehicles on which they make money — i.e., those with hefty price tags and markups relative to their man-hour content. Even at the peak of gas prices, half the vehicles sold in the U.S. were light trucks. In November, amid a collapsed home construction industry and with $4 gasoline fresh in mind, what were the two top sellers? Pickups by Ford and Chevy — and the Dodge Ram was No. 7.<\/p><\/blockquote>\n

While I agree with Jenkins in principle on repealing CAFE standards it’s only one piece of what needs to be done to bring the big three back to profitability… It’ll help but that won’t solve the problem.<\/p>\n

On a related note: Chrysler seems to be winning new friends… I don’t who the marketing genius was that dreamed up the idea publishing a thank you ad but if the comments on their blog<\/a> are any indication it didn’t go over well.<\/p>\n","protected":false},"excerpt":{"rendered":"

I’m doing a little catching up this weekend and trying to read all the two dozen or so articles I bookmarked over the past couple of weeks. One of the items I bookmarked was Holman W. Jenkins Jr. December 31st Op Ed piece in the Wall Street Journal “Let Detroit Build Profitable Cars” In the […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","advanced_seo_description":"","jetpack_seo_html_title":"","jetpack_seo_noindex":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[26,7],"tags":[313,314,315,323,349],"class_list":{"0":"post-1292","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-economy","7":"category-politics","8":"tag-auto-industry","9":"tag-chrysler","10":"tag-ford","11":"tag-gm","12":"tag-uaw","13":"entry"},"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/pfpI7-kQ","jetpack_sharing_enabled":true,"jetpack-related-posts":[{"id":1059,"url":"https:\/\/www.jasetaro.com\/blog\/2008\/11\/26\/the-25-billion-question\/","url_meta":{"origin":1292,"position":0},"title":"The $25 Billion Question","author":"Jeff","date":"November 26, 2008","format":false,"excerpt":"Holman W. Jenkins Jr. has an excellent Op Ed piece in today's Wall Street Journal. Mr. Jenkins ask the one question that no one Congress dares ask... Why is it Ford and GM can build viable auto businesses all over the world but not in North America? A Car Wreck\u2026","rel":"","context":"In "Economy"","block_context":{"text":"Economy","link":"https:\/\/www.jasetaro.com\/blog\/category\/economy\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":1088,"url":"https:\/\/www.jasetaro.com\/blog\/2008\/12\/11\/will-the-auto-industry-bailout-work\/","url_meta":{"origin":1292,"position":1},"title":"Will The Auto Industry Bailout Work?","author":"Jeff","date":"December 11, 2008","format":false,"excerpt":"I've been so focused on finishing up the projects I'm working before the holidays I've only been half attention to the news recently. I completely missed Holman W. Jenkins Jr. latest Wall Street Journal column: The Bailout That Won't Would you buy a car from Congress? By Holman W. Jenkins\u2026","rel":"","context":"In "Money & Investing"","block_context":{"text":"Money & Investing","link":"https:\/\/www.jasetaro.com\/blog\/category\/money-and-investing\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":1539,"url":"https:\/\/www.jasetaro.com\/blog\/2009\/02\/18\/not-just-no-but-hell-no-gm-chrysler-seek-216-billion-in-aid\/","url_meta":{"origin":1292,"position":2},"title":"Not Just No, But Hell No: GM, Chrysler Seek $21.6 Billion in Aid","author":"Jeff","date":"February 18, 2009","format":false,"excerpt":"General Motors and Chrysler have submitted their recovery plans submitted to the U.S. Treasury and are asking for another $21.6 billion in government aid. Not just no, but hell no... No amount of government aid is going to bring them back to profitability so long as the government forces them\u2026","rel":"","context":"In "Economy"","block_context":{"text":"Economy","link":"https:\/\/www.jasetaro.com\/blog\/category\/economy\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":1026,"url":"https:\/\/www.jasetaro.com\/blog\/2008\/11\/19\/mitt-romney-let-detroit-go-bankrupt\/","url_meta":{"origin":1292,"position":3},"title":"Mitt Romney: Let Detroit Go Bankrupt","author":"Jeff","date":"November 19, 2008","format":false,"excerpt":"Former Massachusetts Governor Mitt Romney has a must read Op Ed on troubles facing Chrysler, Ford and GM in today's New York Times. Let Detroit Go Bankrupt By Mitt Romney, New York Times Op-Ed, Wednesday, November 18, 2008 Boston IF General Motors, Ford and Chrysler get the bailout that their\u2026","rel":"","context":"In "Education"","block_context":{"text":"Education","link":"https:\/\/www.jasetaro.com\/blog\/category\/education\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":1430,"url":"https:\/\/www.jasetaro.com\/blog\/2009\/01\/30\/cash-for-clunkers\/","url_meta":{"origin":1292,"position":4},"title":"Cash for Clunkers???","author":"Jeff","date":"January 30, 2009","format":false,"excerpt":"The Wall Street Journal has details on ongoing talks between auto industry officials and lawmakers on a plan aimed at\u00a0 reviving vehicle sales. Under the proposal consumers who replace older gas guzzlers with new fuel-efficient cars would be eligible for federal tax credits of as much as $4,500. Auto-industry officials\u2026","rel":"","context":"In "Economy"","block_context":{"text":"Economy","link":"https:\/\/www.jasetaro.com\/blog\/category\/economy\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":1015,"url":"https:\/\/www.jasetaro.com\/blog\/2008\/11\/18\/cnsnewscom-union-workers-at-big-three-automakers-average-73-an-hour\/","url_meta":{"origin":1292,"position":5},"title":"CNSNews.com: Union Workers at Big Three Automakers Average $73 an Hour","author":"Jeff","date":"November 18, 2008","format":false,"excerpt":"The headline may be a little misleading but the article is worth reading: Union Workers at Big Three Automakers Average $73 an Hour By Pete Winn, Senior Writer\/Editor, CNSNews.com, Tuesday, November 18, 2008 Economists in Michigan, the long-time home of the auto industry, say they don\u2019t support the proposed multi-billion\u2026","rel":"","context":"In "Economy"","block_context":{"text":"Economy","link":"https:\/\/www.jasetaro.com\/blog\/category\/economy\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]}],"jetpack_likes_enabled":true,"_links":{"self":[{"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/posts\/1292","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/comments?post=1292"}],"version-history":[{"count":0,"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/posts\/1292\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/media?parent=1292"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/categories?post=1292"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/tags?post=1292"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}