GM and Chrysler

[Adam Y.]

Originally Posted by sanddrag

(edited). If domestic car companies are to survive, they'll need to step up their designs, quality, and reputation to that of foreign car companies.

For GM, I think the real mistake was made when they let the vice chairman Robert Lutz speak on 60 minutes. The reporter asked about the upcoming "Volt" that supposedly will be revolutionizing the automotive market as we know it. Here is what Lutz said, in my own words/interpretation:

"We wanted to make an electric car. It can only go 1/4 as far as the electric car we made a decade ago, but that's okay, because after that far (40 miles) then it uses a gasoline engine. (errrr????). I said 'this needs to be a car every family can afford. We need to sell it for $20,000.' The engineers said I was crazy, because they couldn't build it for less than $40,000. This is a problem because people won't spend that much on it (because it only goes 40 miles without gas). So, since we've spent so much on it already, we'll keep going, and we'll sell it for $30,000 (which most families can afford) and take a $10,000 loss on each one."

You didn't watch the whole entire show. The right interpretation was that building an electric car that people would want to buy is still expensive, hard to do, and something that companies like Tesla are going to find reality biting them hard. Unfortunately, people who aren't engineers would not get the concept of using gasoline engines in a electric car.