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October 11, 2005
Losing the competitiveness challenge
Whenever the issue of America's competitiveness challenge is raised, one of the standard responses is "been there, done that, not a problem." These folks then go on to explain that the so-called competitiveness challenge of the 1980s was either just a figment of our imagination or a problem we easily overcame. After all, what ever happened to the feared Japan, Inc. takeover of American industry? The US did great in the 1990s while Japan faltered.
Well, look around. How is US industry doing? For example, how is the auto industry doing? The answer to that question can found in the words of the CEO of auto parts manufacturer Delphi in today's New York TImes: As Delphi Goes, So Goes G.M.? By the way, Delphi just filed for bankruptcy.
In an interview on Monday with reporters and editors at The New York Times, Mr. [Robert S.] Miller, who uses Steve as a first name, predicted that General Motors and the Ford Motor Company could find themselves following Delphi into bankruptcy court in the next few years unless they take drastic steps to reduce their own labor costs. Mr. Miller said his company would do what it could to prevent more bankruptcies in the industry.
But Mr. Miller, sounding like the Oracle of Delphi, made clear that he believed that the major auto companies were now engulfed in the same industrial turbulence that had forced the revamping of the steel and airline industries with which he was intimately familiar.
"This is not just a Delphi issue, this is an auto industry issue," Mr. Miller said, "and has to be dealt with" by G.M., Ford and Chrysler, a division of DaimlerChrysler. "I am very concerned about what happens to the Big Three. It is an incredible watershed for the entire industry as we head into the future."
We are now seeing the visible manifestation of the stealth erosion of our industrial competitiveness. While some downplayed the Japanese challenge, Japanese car makers steadily gained market share. Caught up in the dot-com hype, we generally ignored the transformation of manufacturing.
The auto wars of last quarter of the 20th Century are almost over. And the Japanese appear to have won.
One wonders if the same judgement will be made at the end of the first quarter of the 21st Century: America met the challenges of the age - by ignoring them.
Posted by Ken Jarboe at October 11, 2005 11:42 AM
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