Monday, May 11, 2009


GM bankruptcy is almost inevitable

With the bankruptcy of General Motors almost a done deal, it is time to close one of the chapters of modern history - the dominance of American manufacturing. The lack of competitiveness thoroughly exposed by the Japanese during the oil embargo and throughout the last 25 years has finally run its course - and as the old adage goes, the bigger you are, the harder you fall.

I'm not going to pretend I'm an expert here but it's pretty much evident that size and power can only go so far with cars. Of course, here in Saudi Arabia, upsizing is more the norm than the exception, but elsewhere, people don't want to spend all that much money on gas guzzlers. Especially if they drive badly and do not offer much value-added --- Japanese cars take the cake with reliability, while the Europeans have pretty much cornered the market on luxury.

American cars? They are neither here nor there --- too many brands, not enough exciting models, putting premium on muscle when finesse is needed, and on this I am certain --- not knowing enough of the paying consumer.

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