With so much discussion of the Detroit Three’s missteps, it is amazing how little their single worst strategic failing enters the discussion: lack of truly global products and brands.
TheCivic and Corolla are familiar cars all over the world. What’s more, thanks to common hard points in vehicle architectures and assembly plants with similar layouts, Honda and Toyota can build most of their products in any factory they choose, in any corner of the globe, to meet changing market conditions.
And when it comes to global brands, a3-Series or Mercedes E-Class have the same image and prestige in Beijing, Berlin or Boise, Idaho.
But ask someone in Paris or Shanghai about aF-150 or Chevy Camaro and it is doubtful they will know what you are talking about.
GM andhave seen much more success recently in China and Latin America than the U.S., yet they do not have globally integrated operations.
They know what they need to do, but coordinating thousands of engineers and suppliers and dozens of far-flung manufacturing facilities is no easy task.
Ford’s first stab at a “world car” was the Ford Escort introduced in 1981. It was meant to cut costs by sharing numerous components with a similar European version, but instead ended up sharing just one: a water pump gasket.
In the mid-1990s Ford took another shot at creating a global platform with the European Mondeo and U.S. Contour sedans, a $6 billion effort that turned into a fiasco.
After decades of failure and false starts, both are starting to offer truly global products. It could be their salvation.
Ford launches the U.S. version of the Fiesta in the U.S. next spring. The Fiesta is a classy small car that is the first in a series of “world cars” designed to be sold on every continent. It already is doing well in Europe, Australia and China. If it does well in the U.S., too, it may lead Ford into a new era of prosperity.
For more than 10 years GM has been developing common global architectures and building new assembly plants with standardized machinery and layouts. “Interbuildability” has been the mantra.
The goal has been to commonize vehicle architectures and plants to the point where GM products and components are as globally interchangeable asand ’s. It’s finally getting there with products such as the Chevy Cruze small car that promises to be a strong seller on several continents.
It is too late for GM’s former Saab brand, and soon-to-be former Opel unit to benefit, but global integration also promises great economies of scale for Buick if GM can manage decent sales in the U.S.
Buick has been an incredibly strong brand in China dating back to the 1930s when emperors and beloved political leaders owned Buicks. It took GM eight years to sell 1 million Buicks in China, but the second million came in just the last three.
If you are one of the legions of head scratchers wondering why GM chose to keep Buick while it abandoned Pontiac and Saturn, here is the reason:
If GM can optimize engineering, design and production capacity in the U.S. and Asia through the global integration of its products and plants, Buick could become a cash cow thanks to low structural costs and soaring sales in China.