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April 26, 2007
So GM has lost the top spot to Toyota, which sold 2.35 million cars and trucks worldwide in the first quarter; that was about 109,000 more than GM.
It was a long time coming, but was there any doubt it was coming?
Hell's bells, the late David Halberstam pretty much predicted it in his book 'The Reckoning,' which was published in 1986.
For decades, Detroit's Big Three - GM, Ford and Chrysler - have been blinded by short term sales and profits and have ignored the bigger forces at work. While the rest of the world pays astonomical prices for gasoline - $7 a gallon in Europe, for example - Americans pay next to nothing thanks in large part to the anti-gasoline tax lobby promulgated by the Big Three.
And while the Big Three kept on ignoring those signs, it opened the door for Asian manufacturers to start nibbling at the lower end of the food chain. Sure the small, fuel efficient cars were less profitable but once oil prices lost their moorings with the first OPEC crisis of 1973, Americans starting turning to the smaller cars and have never looked back.
I can think of another company that became incredibly successful by building market share while flying under the radar (excuse the pun): Southwest Airlines. Birthed in the shadow of American Airlines and Dallas-Fort Worth International Airport, Southwest started operating as a puddle jumper from Dallas' Love Field Airport. Slowly it nibbled away until it is now one of the largest and most successful airlines in America.
How did it do it? Good management was one essential key, and the same applies to the Asian auto makers. If you're going to lead, know where you're going!
The management running the Big Three have proved themselves clueless time and time again. They tried every trick in the book including persuading Congress to implement import quotas against Japanese auto makers in 1981. They responded by moving up the food chain and building bigger and more expensive cars. And so it went on, with the Asian manufacturers gaining one segment after another and not giving it back.
Talk about being hoisted by your own petard.
In this sense, the recent introduction of Toyota's Tundra full-size pickup truck represents the final step to the top of the food chain just as its worldwide sales finally moved ahead of the heretofore iconic GM.
Posted by 
at 12:52 PM to Auto industry
, Companies
, Sales
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