It has struck this writer that the financial woes of the American Auto Makers seem to be never ending, it seems that Detroit will go through a period of great profits and then fall into a period of financial difficulty.
Now one could say that this is a given, similar to the airlines, with their fixed overhead costs, when the economy takes a dip, so do their profits,but Honda, Toyota, and to a lesser extent Nissan have proven that it's actually possible to stay profitable from quarter to quarter, year to year.
What this seems to point to is a glaring oversight on the behalf of the domestic executive rank and file, where their salaries and bonuses are based on short term projected profits, there's really no reason for the Auto makers to take a long term view, as do the Japanese and the Germans.
It's really a shame that the worlds largest automaker(for now) General Motors finds itself in the position of having to entertain the idea of a merger with a smaller company,Renault-Nissan.
And the Worlds second largest automakers(for Now) Ford motor company is in even more dire shape than the General.
As for Chrysler, their in better shape but not by much, and even with Daimler running the show they have once again fallen on the Employee incentive bandwagon, which doesn't seem to be working this time around. Amazingly Ford and G.M. have resisted following Daimlers footsteps.
But for how long...
J.
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