by Robert Mcmartin

Created on: October 21, 2009

Demand versus supply. It is a simple enough equation and is the basics of Economics.

For years the US Auto industry has stimulated demand through manipulation of people's desire to be both aspirational and different. Constant change of models, even if only minor variations every year or so and a panel upgrade every three years, to ensure that the car looked different to the previous models.

It was Robert McNamara who developed the concept of building a car to a price and this whilst boosting sales and increased model types was what ultimately caused the demise of the US Auto industry. So many different companies, selling so many different cars. Many of the cars were the same model with minor variations to body style, or interior so as to command a higher premium and be different to other models on the road.

The car buying public are also largely to blame, by supporting the industry and slavishly changing their cars every three years for the latest and greatest. The US Auto industry continued to pursue its existing policy. Upgrading models, developing new models based on existing platforms with changes. From the world view it was nothing more than an Automotive Ponzi Scheme.

The US Auto was focussed on domestic sales and limiting imports. Domestic customers were king, keep them buying, sell them the same car available down the road, with a few different features, invite them to a few car shows keep them loyal and not too smart, feed them low interest loans for their cars. Don't focus on foreign sales, we can't compete with the Germans, Brits, or Japanese.

While this insular sales war was going on the world changed. Foreign cars became faster, safer, flasher, more luxurious, more pretentious. Domestic buyers had more money and wanted to buy more pretentious cars, cars that made a statement. Owning a Cadillac wasn't enough of a statement, they wanted a Rolls Royce, or a Bentley. Cars became bling, cars were merely an accessory to show people how much money they had. Domestic cars couldn't reach that level. No matter how much whale skin penis leather you put on the car, you can only put so much lipstick on a pig and people will always see its a pig.

The US Auto industry can recover, it needs to look backwards a little, it needs to look back to the 20's and 30's when US cars were the cars the world wanted. When oppulance and speed, were what the world wanted.

The US leads the world in technology and luxury, it needs to remind the world of what it has done and what it can do. Maybe it is time to build cars to a price, certainly cater for the masses, but build a luxurious, state of the art vehicle with luxury befitting a vehicle of high price and a motor that harks back to the great engines that powered the Dusenbergs.

Maybe it also needs a car that the masses can aspire too, if you sell them a Chevrolet, sell them diffferent models. Make the base one the safest, and each model up adds more to luxury and comfort.

Make them affordable, reliable and safe. Make them desirable. Don't rely on the marketing department to design them. Let the designers and engineers design and build them and let the people decide what they want to own, not faceless focus groups and marketing committees. This will make the industry great, but would the captains of industries trust people to know what they want. Of course they don't know what they want, we need marketers and advertising men to tell them what they want and for a low price we can sell expensive and make a lot of money for all.

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