Tuesday, December 16, 2008

Should GM et al Make Cars in China (or India)?

The incomparable John Batchelor asserts that GM should make their cars in China. I have been saying this for awhile. They should file chapter 11 and relocate their manufacturing to China. The unions have outlived their usefulness and have been the downfall of the car companies. Honestly, the only reason they are getting such treatment is that the democrats owe the unions for getting Ostalin elected. At this point I don't know if they can file chapter 11, but they must do something quickly, and groveling to us, while keeping the status quo insofar as how they do business is a bad bet for us.  As they say is is throwing good money after bad. If they don't get it right, then creative destruction is in order. It is good when unprofitable ventures fail because behind them is another that will be profitable to take its place. I liken it to having a garden where we keep the rotting but still living plants because we do not want to see them die. Meanwhile the same fertile real estate could be used to grow a plant that is healthy and productive. The goal of capitalism isn't consumerism, but productivity and value. GM, Ford and Chrysler off very little of both. 

Thank you for reading this blog. 

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