Comments: Problems at General Motors; Globalization

Here's a comment a reader who responded to my post on Problems at General Motors:

I think it's game over.  The sad...sad...sad truth which few want to admit is that China and India are coming into their own. China WILL begin flooding US markets with their cheap cars in a year or two.  They will offer SUVs for $12k and luxury cars for 15k.  The cars will be crap at first but at 12k, you could buy two and throw them away every three years or so.

There is no way to compete with a workforce that is willing to work for 0.50/hour.  Hell, even if you offered $5.15/hour to the average India/China worker most people over there would be considered rich.

TVs, DVDs, VCRs - they all stopped being made in America years ago.  Just add Cars to the list.

On a slight tangent, I saw a feature on 60 minutes where many Americans were flying to India to have their heart operations. Why pay $100,000 for an operation here when you can fly there and get one for 30,000?  Oh yeah, the 30k includes like 4 weeks stay at resort on the beach.  Most of the doctors there were trained and worked in the US for years before going to India.

Welcome to Globalization.

I saw the 60 Minutes piece as well. It said you can get as good care there as in the U.S., you stay in much nicer accommodations, and medical care costs much, much less. What's not to love?

As far as cars are concerned, I'm not as pessimistic as this reader. There will always be demand for higher quality (and thus higher priced) cars. It just remains to be seen if the American auto makers can make them.

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Comments

[Jane Dough]

I really think the only thing that will save American Industry is to continue to innovate. US Auto makers need to provide the next "must have" vehicle which appears to be the hybrid. If they can give us energy efficient vehicles that satisfy American drivers they will do well. The US just needs to keep being the innovative leader - it is a challenge but we are still the best place in the world for someone with an idea to turn it into a product.