Triage for the Big Three Automakers

Triage is the process of prioritizing patients based on the severity of their condition. This facilitates the ability to treat as many patients as possible when resources are insufficient for all to be treated immediately.

Nowhere is this more appropriate than in addressing the problems of the Big 3 automakers. The current proposal of prioritizing the bailout to the company in the most dire straits, GM, has it all backwards. The money should go to the company or companies that have the best chance of recovery. Forget about trying to save all three manufacturers. By doing so with the limited funds available, we'll help none of them. If we want to rebuild our auto industry and do the most for the workers and suppliers, we need to create as sound a foundation as possible. And that means building on the strengths, not the weaknesses of Detroit.

So what should we do? Congress should be comparing the restructuring plans of each, figuring out which ones make the most sense and have the best chance of success, and then support the strongest.

Phil Baker is the technology columnist for the San Diego Transcript, a product design consultant, and author of the just released "From Concept to Consumer" from Financial Times Press.

Comments

[William1950]

10:54 PM on 12/10/2008

one thing I was reminded of tonight... just how much have the southern states given in the forms of tax breaks, free land, sweet deals ... to the foriegn automakers to locate there with their non union jobs to "compete" with the big three... I know that Mississippi has forked over millions of dollars in cash, tax breaks land deals etc,,, soooo when all the folks say that the big three cannot compete that is yet another example of BS becoming common thought.
the middle class does not have the money to buy cars! ... auto makers WORLDWIDE are having trouble and are being bailed out by their respective governments... it's not just us.

[KillTheMessenger]

01:24 AM on 12/11/2008

The big three didn't lose because Toyota and Honda won. They lost because they have reduced selling to selling by the numbers and not by profit. Training your own customers for years to wait until you run the $5000 cash back ads on tv is financial suicide for any business. And GM has perfected it. To their sales people everything seems to have come down to "I will be damned if I don't sell another car on the lot by selling all other cars on the lot for $1000 less".

Think about that for a little bit.

[KillTheMessenger]

09:06 PM on 12/10/2008

Damn right. We will be wasting money to keep a dead body (GM, not Lenin) on display, make Cerberus (the flesh eating company, not the dog) even richer and keep Ford (which does not need help) less competitive because it can't profit from the natural market deaths of the bad and the ugly.

It is absolutely outrageous how collectively dumb this country is. And we are not even learning from our mistakes.