Dec 15, 2008

Playing Politics With the Auto Bailout

A recently published letter to the editor (NYT, 12/13/08):

Your Dec. 9 Business Day article about car dealers opens the door on one of the most challenging impediments to growth in the American auto industry: inefficient and uninspired retail distribution.

Though there’s plenty of blame to go around in this national marketing tragedy, Mark Aleve of General Motors is correct in pointing out that if there were fewer dealerships with higher sales, they could invest more in facilities, people, training and advertising.

In the end, the auto industry has been caught up by a powerful change sweeping consumer markets. A long period of retail cost-cutting and price discounting has led to consistent underinvestment in broader consumer experiences.

Instead we’ve had poor service, me-too assortments, little assistance and declining trust in product quality. Luckily for Toyota, it figured all this out well before building its American retail system.

It’s not too late for G.M., Ford and Chrysler to get back in consumers’ good graces.

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