After Years of Stumbles, Moment of Truth

By Edward Shanahan

It was 1964 when we bought our last Detroit car, and we loved that baby, a brand-new, white, good-looking, compact Dodge Dart station wagon. It was a classic.

But by 1968, with three small children, we needed something roomier, so we reluctantly sold the Dart and put ourselves in a Volkswagen mini-bus with a new feature, the sliding side door.

With that, as US automakers did their best to alienate many former customers in a variety of ways, we never looked back. In the 1960s Detroit began to come out on the short end in product quality, compared to the up and coming Japanese cars. And the so-called Big Three fought tooth and nail the emerging concern about providing as standard equipment such safety features as seat belts and air bags.

I was working on Capitol Hill at the time when Ralph Nader first came on the scene and was on hand for the sensational Senate hearing when it was revealed that General Motors had a private detective delve into Nader’s private life, as a consequence of his crusade for safer automobiles.

That attitude of muzzling any critic and attacking any suggestion that the American car business – from top to bottom – was anything less than perfect became the rigid We Know Best posture of GM., Ford and Chrysler.

A few years later as a reporter in Detroit, I wrote a series of articles in the Free Press on the hazards and dishonesty that awaited a young family setting out to go new car shopping in Car City USA. There was so much less information for the consumer in those days. It was humiliating to accept the fact that that no matter how hard you tried to negotiate a fair purchase price, you were going to get hosed, as they say. The dealers’ response to the articles was to withdraw hundreds of thousands of advertising dollars from the newspaper.

Somewhat later while still in Detroit, I had another exposure to the soft underbelly of Big Auto and Big Union, while covering the ritual negotiations for a three-year new contract between the United Auto Workers and Ford, spending an entire summer at Ford’s glass headquarters in Dearborn.

The result of that negotiation was pretty much identical to what had been going one for decades – the union targeted one company to settle under a strike threat, and once a settlement was reached, the other two companies fell in line and accepted a similar contract.

It was not hard to sell cars in the 50s, 60s, and 70s, when gasoline was cheap, so the settlements inevitably offered rich gains in wages and fringe benefits, such as company-paid health insurance, now and forever. All that was required to pay for the enhanced benefits and keep the money rolling in for stockholders was to raise the price of new cars.

Industry and union thinking was short range. Settle now and worry about the future three years down the road. And so it went every three years, labor relations as theater.

When the gasoline shortages hit in the 70s, there was some suggestion that more fuel- efficient cars might make sense but there was no major restructuring of the industry. Then, it became clear to almost everyone who drove a car, that vehicles made in Japan were not only better-built but more affordable to purchase and cheaper to maintain. Still, Detroit did not get the picture.