UAW Head Ron Gettelfinger Blames High Gas Prices for Big Three Problems - Give Me A Break

The UAW President Ron Gettelfinger is now saying that high gas prices are the cause for the Big Three collapse and that the companys' problems shouldn't be blamed on mismanagement or high labor costs. What a cop out.

The UAW President Ron Gettelfinger is now saying that high gas prices are the cause for the Big Three collapse and that the companys' problems shouldn't be blamed on mismanagement or high labor costs.

According to the WSJ:

"The UAW president said the industry's predicament is a direct result of an unprecedented drop-off in auto sales that started with high gas prices this summer. Eroding consumer confidence to make big-ticket purchases was fueled by a credit crunch that limited customers' ability to buy a new car or truck and forced the companies to spend more money then they were bringing in, according to Mr. Gettelfinger."

They are not the result of high labor, pension, and medical costs and not because of mismanagement.  He even defended the same management he has blasted in the past:

\"It's a stretch to say that management is responsible for all of the things happening now that no one anticipated or expected...\"

Give me a break.  No one could foresee the increase in gas prices and the eventual recession?  I guess the top management at GM, Ford, and Chysler are paid to assume that gas will always stay below $2.00 per gallon and that the economy will always be booming.  I guess that's the only way these guys can run a company.  Because it's clear that there was 0 contigency planning for a rainy day.  Ever heard of that?

Why is it that Toyota is still profitable?  Sure, they're earning less money but they are still making money.  Could it be because they didn't bet the house on large SUVs and utility trucks?

Is it the economies fault that American car companies have hemorrhaged market share even during the good times?  Either the costs of American manfacturing are too high or the existing American execs can't successfully lead their companies.  I personally believe it's a combination of both.

Blaming the economic downturn for the woes of the American car industry is like saying you failed a class because the test was too hard.

I used to be the staunchest supporter of the American car industry.  I used to get my Car and Driver and read the reviews, waiting for the US to turn it around.  I hoped that Saturn would be the answer - it wasn't.  I went to car shows and waited to see something good.  I waited, and waited, and waited, and eventually gave up.

I still believe the US can produce the best cars in the world, but not as the industry is currently structured.  Simply funding the status quo is a recipe for failure.

Sam Cass
Sam Cass: Sam Cass, MBA, JD, University of Texas at Austin. Always a fan of Leonardo Da Vinci.

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Comments

  • Richard Oster

    December 13, 2008

    Look around you, talk to the gas station owners, oil companies gouged us and everyone lost their expendable income. Restaurants and businesses closed due a lack of customers. Oil company profits were up 40% every quarter for two years while consumption went down.

  • rytmitz

    December 13, 2008

    there's nothing new about higher gas prices as it always been an issue ever since. And we are all affected! better alternatives is to use electric or hybrid vehicles with fuel saving additives than the fuel-dependent ones.

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