What really caused the downfall of GM?...Started with "Planned Obsolesce"?
In 1941 the CEO of GM was Alfred Slone. He announced the theory that was the initial downfall of GM...Planned Obsolesce. The theory that one builds an item for a certain lifetime of use then instead fixing it, they just buy another one. This was just all well and fine when cars were not expected to last in excess of 100,000 miles. But then foreign Imports came about and the populous soon learned that the majority of the imports lasted much longer than the GM cars thus giving them a higher resale value and becoming a more valuable commodity. GM never got that one of the essential elements of a viable Planned Obsolesce scheme was that the customer would most probably buy from the same manufacturer if they liked the product. Honda and Toyota all figured the Planned Obsolesce should be around 200,000 miles and designed and manufactured for that. This was a inexpensive way of getting great word of mouth advertising which is the cheapest and most effective means of promoting their product by far.Nissan and Mitsubishi went along with the American model of 100,000 miles of life and we see where that has got them.Next, is the raping of GM by the Unions. GM, at it's bankruptcy, had 4 people collecting retirement benefits for every 1 employee. A company can't afford to maintain these levels.The answers to these situations is clear: The present one taken by the Obama administration is actually quite good. It reduces the maintenance of the health care/retirement packages and ties them to the profitability of the GM in the future by issuing stock. The original question is still not answered: Will the life span of the new GM vehicles raise to the level of Honda and Toyota or stay at 100,000 miles. My guess is that they will stay with the 100,000 mile theory since it is so popular. Let's look at the Electronics industry: Why can't one change the battery in an ipod? Planned Obsolescence. The "Fashion" industry...another prime example of P.O.This idea is being pushed by the advertising industry which has the marketing sections of companies snowballed. First when times are good, you must advertise to keep your market share, when times are bad, you must advertise to stay alive. Are Americans so stupid that they fall for others telling them what is "in style" in the world? It would seem so.
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