Konkocars.com

By: James Sawers

Nissan Motor Corporation was once ton the verge of bankruptcy. The legendary Japanese company almost closed. That is until they hired a great executive in Carlos Ghosn to lead the company to a comeback. He had the experience, the know-how, and the ability to do so.

Carlos Ghosn is a ruthless, direct management style executive. He knows what he wants and how he wants the job done. He is a micromanager that approves every single aspect of cars being released. He is famous for being direct with designers and staff members, he is not afraid to voice his opinion to the press, and doesn’t shy from interviews.

Nissan needed an executive that could run a company with the product in mind along with the bottom line. They needed a leader that they could rally behind, had the guts to do the unthinkable, and be able to end a product that will not be successful. Carlos Ghosn was the executive the board called.

Carlos Ghosn knew that he needed to tap into the heritage of Nissan. He knew it was time to find a true identity for the company and build upon it. Nissan was going to be a mainstream sports car. The first project was designing and building the legendary Z-Roadster. In 200, Nissan executives began working on the new 350Z, set to debut in showrooms in 2002. Ghosn knew what he wanted with this car: style, speed, and sex appeal. The designers succeeded fully and the all-new 350Z was a hit amongst the buying public.

Next was a well-known Nissan: the Maxima. The Nissan Maxima had always been a solid selling, well built car. The Maxima was a front wheel drive car that had been lost in the design spectrum of the industry. Ghosn wasn’t impressed and told designers to redesign the Maxima to his liking: Big, Bold, and Beautiful. In 2003 the redesigned Maxima hit showrooms as a big and bold design. Dealers were excited and the buying public was back. The Maxima became a hot seller and became the number two best-selling vehicle in their lineup.

Number one was a product that Ghosn knew had to be sexy, appealing, sporty, safe, quality, and competitive. That car was the Nissan Altima.

The Nissan Altima competes in the family sedan class against the likes of the Toyota  Camry, Honda Accord, Hyundai Sonata, and Ford Fusion.  Ghosn knew the car had to appeal to be a success. Designers had to succeed and met Ghosn’s standards. He was there every step of the way with the Altima, as with all products. Once he gave his approval, the car moved fast to production. Ghosn is known not to waste time, once he makes a decision the move to production is fast. Once in production the build standards had better be up to his standards or he will take serious action.

After reinventing the top cars in the lineup through 2002-2004, Ghosn knew there was more work to be done. He took a serious look at Infiniti and did the unthinkable in the industry; he aimed his target at BMW. He knew Infiniti needed customers, they needed to have a heritage, and they had to find their identity fast.

That leads to the 2003 Infiniti G35 Sedan/Coupe. The car came up short to the competition from Munich, however was too close for comfort for BMW. In 2008, the second generation G35 (now the G37) defeated the BMW 3 Series in a head to head comparison in THREE major publications. Ghosn had done the unthinkable; he had beat BMW.

In 2008, Ghosn unveiled the long anticipated Nissan GT-R. The buying public and industry had been waiting and the executives weren’t sure if they should go ahead with the project. They did, and won Car of the Year honors from Motor Trend and Automobile Magazine.

Today, Nissan continues to make money, sell cars, and is very far from where they were pre-Ghosn. Nissan may not be popular amongst everyone in the industry, however they are a hit with young people, professionals, and families. Nissan has a market niche they have succeeded in revitalizing, and a complete company in a very hard industry.

From Nissan to Infiniti, Nissan Motor Corporation has made a comeback, all with Carlos Ghosn at the help. A gutsy, ruthless, direct, and driven executive with a love of the product and bottom line continues to lead Nissan into being a serious competitor in the global industry.

Nissan Motor Corporation continues to invest in the United States as well. They have developed into one of the leading “Green” companies with their business practices and headquarters.

Detroit, are you listening? There is a valuable lesson to be learned from Carlos Ghosn, President & CEO of Nissan Motor Corporation.

By: James Sawers

 General Motors is a company to watch. That’s right. The General is on the brink of a serious comeback. With a new marketing campaign, improved quality, and newly designed world-class vehicles, they are a future force to be reckoned with.

 In the past two years General Motors has lost nearly 30% of its American market share. They have continued to lose in the American marketplace. That’s okay with GM executives too. GM continues to gain where it counts, globally. In order for GM to be competitive and profitable wit their “New GM” business plan the company needs to be a force globally.

 General Motors has a heritage in the United States. They have been known for being “the” company in America. They have given great classics to the people (i.e. Corvette, GTO, Camaro, XLR, Chevelle, and so on). These were great cars of the 20^th Century. The fact today is the 21^st Century has come upon us and the time for a global business has as well.

 What’s interesting is that the executives at GM get it this time. They understand after numerous failed attempts, that they need to be a global car company. Their products need to appeal to the masses globally. With entries like the CTS Sport Wagon, and Chevrolet Cruze, that will not be a problem.

 For America, we have gotten the new greats. We have received the likes of the new 2010 Cadillac SRX, Buick LaCrosse, Pontiac G8, Pontiac Solstice, Cadillac CTS, CTS-V, and CTS Sport Wagon. The car that kicked off the new quality, marketing, and new GM is still popular today, the Chevrolet Malibu. The point is General Motors gets it. The industry has serious hard work ahead of it.

 Getting customers back is hard, especially after alienating many of them over the years due to the lack of quality, poor dealerships, poor service, and just an overall bad experience. General Motors understands this and is confident in their line-up and the future line-up of their business.

 Hats off to General Motors and “May the Best Car Win.”

By: James Sawers

 It has been a tough few years for the domestic auto industry. Sales dropped below the 10 million units mark for the first time in over 20 years, and more incentives offered on average per sale than ever before. There are a few bright spots in the industry: Subaru, Hyundai, and Volkswagen. These companies are succeeding for reasons beyond the car world. They continue to invest in American manufacturing with no UAW affiliations. They employ MORE Americans (combined) than the Big Three do and pay a better wage (Average 24.05/ Hour) and better healthcare benefits, all while being union-free.

SUBARU

The ONLY car company to post a profit in 2008 and increased sales (+1.9%) in FY2008 has continued to post excellent numbers in 2009. Subaru continues to amaze industry analysts with their numbers. The company offers a good product with exceptional quality, competitive prices, and rewarding customer experiences. Subaru posts the highest retention rate among shoppers in the market (64% of buyers return) and continues to give customers reasons to come experience new products. In addition to Subaru’s high quality and reasonable prices, the company has an excellent dealer network. Subaru micromanages their business so that dealers do retain customers: Dealers are required to be low pressure, easy to deal with, and respectful. They MUST be exemplary and if a dealer doesn’t meet the expectations, they are dropped. Subaru knows it takes hard work, superior quality, and a great experience to retain customers. They continue to do it and do it well. Subaru has invested in America, employing nearly 15,000 Americans in Indiana, California, and Vermont. They have invested in the United States and in turn Americans are investing in their products.

HYUNDAI

This South Korean automaker continues to be a force. They have been giving traditional luxury automakers a run for their money and upped the ante on the industry. In 2009 Hyundai released the heavily successful Genesis sedan. This is a 5 Star luxury offering at a 2 Star price. Offered even with a V-8 for a peak price of $42,000 this car is a true value. One common trait with their entire line-up from Genesis on down to the Accent is ever improving quality. Once and automaker known for being tuna cans of wheels, they are now a solid contender, offering 10 year warranties, a vast dealer network, and an improving public image, backed up by it’s solid products. Hyundai is a profitable contender in the American market. Currently Hyundai employs nearly 10,000 American workers at facilities in Alabama, New York, Georgia, and California.

VOLKSWAGEN

 A car for the people has been the advertising motto for VW for nearly 10 years now. They are continuing to succeed in their quest to become the biggest automaker in the world by 2015. This has become possible due to the quality and sales problems at Toyota. VW has an array of offerings from the entry level Golf to the top of the line Toureg SUV. The vehicles have excellent European styling, solid German quality, and a perceived value to them due to strong marketing efforts. The spotlight shines in the VW Passat CC, a car taking aim at the Mercedes-Benz CLS. The Passat CC is a four-door coupe that hits a niche, has a high profit margin, and offers stylish luxury at a starting price of $26,500. Leather is standard along with the solid 2.0T engine, and an excellent sound system. Volkswagen continues to invest in the United States as well, with a nearly $3 Billion facility under construction in Tennessee set to open in 2011/2012 and creating nearly 5,000- 10,000 FULL-TIME AMERICAN manufacturing jobs. VW officials say that by 2020 they could operate five to seven manufacturing facilities in the United States employing nearly 90,000 Americans.

All three companies offer the same common values. Subaru, Hyundai, and Volkswagen offer good products, value pricing, excellent quality, good experiences, and a good dollar spent ratio. They have vehicles for the masses, care about our environment, and care about the American worker. They pay better wages, offer better benefits, and more job security than the Big Three. They listen to their customers and make the right business decisions based on the information they receive. They take care of their workers, communities, and products, all resulting in a better bottom line. These three are great examples of success stories in a down time.

By: James Sawers

Saab cars have always been known for their quirky ways, their owners, and their design. They have always had a loyal following, usually associated with the latte sipping lefties of society. Saabs are an international icon, an icon on the edge of being out of business. Saab is a Sweedish automaker that has been under the management and control of General Motors since 1990. This column is not about Saab per se as much as it is about the lesson we can learn in business from the acquisition made in 1990.

Saab was once a car company known for innovation, engineering, reliability, quality, and safety. Today many don’t even consider a Saab when thinking of purchasing a car. General Motors had an opportunity and wasted it with this Saab business deal. Once a company always in the black, Saab became debt ridden and in the red constantly. They are a Sweedish icon that was denied a bailout in December 2008. This has left no option but for GM to put the brand up for sale, probably a blessing in disguise.

First we must take a look at Saab pre-GM to understand why they are in the current situation. Saab was a well perceived, quirky brand, and was known to the world as solid, reliable, jet inspired cars. They had turbo engines, diesels, safety, innovation, distinct styling, and a loyal following. In fact it was once reported in 1988 that nearly 66% of Saab buyers bought a Saab again when they purchased a new car. Two-thirds loyalty among the customer base in enviable for all business. Even Wal-Mart can’t touch those numbers, yet today, in 2009 that number is a small 20% for Saab. A 46% drop is not acceptable and needs to be investigated. General Motors let Saab fail, and here is why:

• Poor Quality
• Poor investment into an “investment”
• Generic design
• Lack of pride and soul in the product
• Poor materials, fit and finish, and quality
• Mass produced cars built on true assembly lines
• Arrogance, refusing to listen to the customer

This leads one to believe that General Motors management isn’t capable of managing anything, let alone the world’s second largest automaker and the Saab division.

General Motors management needs to take a lesson from a successful Indian car company, Tata Motor Group. In 2007, Tata finalized a deal with Ford Motor Company and purchased Jaguar. Jaguar was another brand that was hurt dreadfully by poor American management that wanted to produce Jaguar for the masses, as GM did with Saab. Ford hurt Jaguar in many ways and eventually almost to the complete failure of Jaguar. Ring a bell GM? Tata has successfully turned Jaguar around with innovative products, engineering, and design. The root of success for Tata is simply to be a financial backer and in the end successful investor in Jaguar. Tata allowed Jaguar to return to its soul, roots, and heritage.

Tata is a formidable buyer for the likes of Saab. Saab carries a global name, a loyal following, and a true heritage. General Motors ruined Saab. It alienated its customer base, it ruined the products it made, and manufactured Saab on the cheap. It tried to make Saab appeal to the masses and in the end that plan failed miserably. General Motors ruined Saab so much that even Hummer, a division that loses four times more money annually was sold faster to a Chinese firm.

The title of this column mentions the importance of Saab. That importance isn’t in the brand itself, but rather the lessons that can be learned from the debacle of a deal GM made 19 years ago. It’s a lesson in business that can be learned and should be learned from. In the auto world or any business remember the old adage: “If it ain’t broken, don’t fix it” and remember the General Motors and Saab deal that took place over the course of 19 gloomy years.

by James Sawers

In the automotive industry some companies are more successful than others, but it sees that no matter what the companies make it through their rocky times. Recently General Motors and Chrysler have not fared very well. For the first time in 100+ years of business GM declared bankruptcy. A sad day for them and their history for sure. Chrysler LLC. This week was purchased by Italian automaker Fiat AG, something that those who follow the industry did not find surprising.

This brings me to Daimler AG. The Germans have their “Big Three” and two are in serious trouble. BMW AG and Daimler together only sell a bit over 3 million units COMBINED. The third competitor VW AG sells more than double that figure with their units.

Can Daimler succeed? My answer is in the short-term yes, they can. Daimler has reset the way the do business as of late internally at their company. Daimler (Parent of Mercedes-Benz) has gone to their ways of the past, when their products were known as “German tanks”, cars that led in technological advances, lasted forever, and were top quality. They were truly worth what you paid for them. The reason for this turnaround? CEO Dieter Zetsche has gone back to the mantra “Built to a standard, not a price”. This enables engineers and designers to focus on the product, the overall car, and the experience of owning a Mercedes-Benz again.

There is a needed improvement, as since 2006 sales have fallen nearly 25% and with the international financial crisis, the failed marriage with Chrylser, and a modern reputation for not being very quality and reliable, Diamler needed to make a change. It all started with the 2008 Mercedes Benz C-Class and will continue with the 2010 E-Class. Daimler has focused on engineering vehicles in Germany again, and working on improving its image as well.

Business has been awful as of late for the entire industry. Daimler sells only 1.9 million units annually, including their Smart brand, and in order to survive with revenues and profits to be used for advancing technology, funding redesigns, and working on building a better business, the company needs to expand. Sources say that Daimler may think of working with the French automaker Peugot/Citroen AG to expand their business and their ability to sell more units. The downside is that some on the Board of Directors are nervous about this, following the disaster with Chrysler (Daimler lost $2.5 billion in the deal).

Daimler has a major advantage in this situation that costs virtually nothing, they are very well known internationally. The company has a heritage, history, and elegance to it that very few can match. They are on the cutting edge of technology and design.

The question remains, Can Daimler succeed by “Building to a standard, not a price?”. My opinion is that they absolutely can. Americans want to get what they pay for. The average sale price of a Mercedes-Benz is the U.S. in 2008 was $46,000. That figure shows that the C-Class and E-Class were the most successful models for this company. By focusing on these models, improving marketing, design, quality, reliability, and an overall business model to be more successful globally, Daimler can truly be THE standard once again in the United States and the world.