Bailout!

In keeping with my frequent posting plan (8 months isn't that long), I figured the automotive industry conundrum is enough to make me start typing again...

Having spent just over 7 years in the auto industry of Detroit between 1994 and 2002, I have a love-hate relationship with "American" car companies.

In the early 90's I was working as an aerospace engineer in a tough market. Working without a raise at a pretty low rate for 3 years in a row got me looking elsewhere. An ad in the LA Times (pre Monster.com, etc.) was looking for engineers to take jobs in the automotive industry. I guess some sort of state grant in Michigan paid to bring some more troops to design and engineer the next great thing in automobiles, which is more or less the same thing they have always made. I had an interview, then was sent to re-programming training session that pretty much taught you have to do manual drafting, which I already knew, and never had to use afterward. After these two weeks, we were shipped off Detroit. Or in other words, I drove out there with my car filled with basic living items. Luckily I had a friend in San Diego whose parents and brother lived in the same area I would work. I arrived the day after Thanksgiving, 1994. I got a room with them and started my next level of training. This was CAD training. This was very valuable.

For about 2 weeks, we were getting trained in CATIA V4, which was far more advanced than anything I ever did in AutoCAD prior. We would design in full 3D. At the time, little was done in solid modeling, mostly just surfacing, which is a very valuable skill to know. After the 2 weeks were up we were supposed to be placed as a contractor in a Chrysler facility. Someone must have forgot to tell Chrysler, as they weren't really interested in hiring 2 weeks before Christmas.

In the interim, the suckers like me who made the trek out were demanding some sort of position until Chrysler would commit after the start of 1995. One of my fellow trekkers was placed at a plant that was molding the composite body panels for the Dodge Viper. He knew I had experience in composites, and called me to see if I wanted to come out there as well. I did and I did, Thus started my career in the auto industry. Funny thing happened. I was around a bunch of guys with the name engineer in their title. It took a couple weeks to find out, but eventually I learned that very few people who were called and engineer actually had an engineering degree, or even any post high school education. Turns out you could work your way up from the shop floor. Even the chief engineer was not an engineer. I was the only one with an engineering degree in the whole plant. I later came to realize, with good accuracy, that anyone who would answer the phone "engineering", was not.

To keep this less rambly, let's just say 7 years, about 6 different companies ranging from manufacturing to racing, to advanced vehicle design, gave me a pretty good feel for what the industry is all about. I planned on a maximum of 5 year, so I outlived my original plan by a couple years.

How does this relate to the bailout? Well, knowing how the companies viewed development, advanced technologies, efficiency, lightweighting, and how they all relate to profits, it's no surprise that they are in the situation they are in today. Do I have any sorry feelings for the companies? No. Do I feel for the people who are dumb enough to still work there? I guess I do. Too many people are too trusting of their employers. Obviously the ones promised a nice retirement for 25 or whatever years of service should be entitled to it. Should they have been promised this in the first place? Probably not.

Having had so many advanced projects involving light weight structures canceled while in Detroit, I'm pretty sure the same fate was met by those who worked on high efficiency powertrains. The Big 3 just didn't give a shit. If it didn't make a large profit, or didn't allow them to make more big piles of shit by offsets with smaller cars destined for the rental fleet, they wouldn't do it. A 10 year plan at one company to develop light weight chassis designs was dropped after 3 years, when a profit could not be made immediately. I think their stock is running at 38 cents a share right now. What a bunch of losers. Literally.

My bet is that we will see, for sure one of the 3 gone in the next couple of years, either by acquisition or solvency. No one will miss Chrysler. Next to go, but might just pull through is GM. Ford should be safe, they were the only ones to have some vision of the future, though a really poor one. Would there not be such huge ripple effects should all the companies go under, I'd say let them all disappear. I'll be happy if one disappears and the other two stay scared.

They technology is there to do amazing things. Denying it over and over again will only allow your competitors to leap frog you. Guess what, it happened a long time ago, and you'll never catch up.