Ed Quillen: Detroits demise has more than one cause
December 19, 2008
There was a time, about 30 years ago, when the economy of this part of Colorado was connected to the auto industry, via the steel industry. A dozen miles above Leadville, the Climax Mine had 3,000 employees who moved thousands of tons of rock every day to produce molybdenum, an obscure metal employed as an alloy to harden the steel used in automotive drive trains.From Salida on summer mornings, a train of empty gondola cars climbed 22 miles to the Monarch Quarry, to return in the afternoon laden with limestone for steel-making at the giant CF&I mill in Pueblo, which also relied on an iron mine in Wyoming and coal mines near Trinidad.Those industries faded away in the early 1980s. Part of the problem, as I understood it then, was that high interest rates meant that people were reluctant to borrow money to buy new cars, and Detroits woes throttled the steel industry.This time around, the problem with Detroit seems more complicated than interest rates. Some blame the United Auto Workers union for uncompetitive, high labor costs. Others blame the banking crisis for making it more difficult for people to get car loans. And theres a huge contingent that blames the Big Three for focusing on big gas-guzzling pickups and SUVs, which lost their appeal when gasoline went over $4 a gallon last summer.But is that really Detroits fault?Back in college, I took a marketing class and heard a story that may be true. Shortly after World War II, as it quit building tanks and resumed civilian production, the Chrysler company commissioned a public-research firm to ask Americans what kind of cars they wanted to buy.Practical, efficient sedans was the answer, and if you look at a 1954 Plymouth, thats what youll see a plain, sensible car. However, even though these were what people said they wanted, such cars did not sell well. So Chrysler hired another survey firm, which asked a better question: What kind of car do you think your neighbor wants?The neighbor wanted something big, overpowered and gaudy. Chrysler designed and built such cars remember the chrome and tail fins on the car in the movie Christine, a 1958 Plymouth Fury? And these sold a lot better than the little boxy sedans.So it seems unfair to blame Detroit for giving the American public what it wanted for the past two decades. Granted, the profit margins were much higher on pickups and SUVs than on small sedans, but the companies were, after all, in business to make money.And the demand was there. For 23 straight years, the Ford F series was not just the best-selling pickup in America, but the best-seller of all vehicles. Nobody held a gun to Americans heads to force them to buy these instead of little Fiestas, or behemoth Hummers instead of tiny Geo Metros, or Dodge Rams with big Hemi V-8s instead of small Dodge Neons, or Chevy Suburbans instead of Cavaliers.And if you think it was Detroit determination, rather than American demand, that pushed this trend, consider Toyota. It built its reputation on tough little pickups, but the American craving for big pickups was such that the company contrived the full-size Tundra and built an $850 million assembly plant in Texas for it in 2006. Tundra sales fell 65 percent this year, and the plant just resumed work after a three-month shutdown.Like the American Big Three, Toyota was merely trying to provide Americans with the vehicles that people wanted to buy. So while it might be fun to point fingers at Big Three management or the UAW, we did a pretty good job of bringing this on ourselves.
Ed Quillen is a writer in Salida, Colo., where he produces regular op-ed columns for The Denver Post and publishes Colorado Central, a small regional monthly magazine.