There were a number of lessons to be learned last week during press days at the North American International Auto Show in Detroit.
1. Suppliers to Big 3 operations in North America must hunker down fast. Many suppliers began battening the hatches late last year. But judging by some of the talk in Detroit last week, more production cuts are likely as automakers fight to reduce bloated vehicle inventories without resorting to a new round of retail incentives. Be prepared.
2. Although Dieter Zetsche and Wolfgang Bernhard seem serious about working amicably with suppliers to resolve DaimlerChrysler's acute problem of variable cost overruns, the new strategy is a departure from the well-liked SCORE program.
Under SCORE, suppliers identified ways to cut costs in their own operations, and Chrysler split the savings with the supplier. Now, Chrysler says it will help suppliers identify areas in which to cut costs, which is similar to what Inaki Lopez told General Motors suppliers. The Chrysler group must not let its zeal to reduce variable costs starve and alienate suppliers.
3. Design is fashion and fashion is design, which may explain some trends. But there were no clear show stoppers among the concept vehicles in Detroit. Why? There was too much sameness within the international design community.
Too many cars borrowed design cues from the Audi TT, and too many thick, bulbous vehicles looked more like locomotives or tanks than wagons and sport-utes. Designers must not forget the lessons of the Pontiac Aztek, which is being sent back to the studio for a makeover just months after its launch. The dog must like the dog food.
4. Affordable hybrid vehicles from the Big 3 ought to be successful. It will take a little marketing, but Americans will do the right thing, particularly if there is not a serious fall-off in performance or a steep cost penalty in owning and using vehicles that combine gasoline engines and battery-driven electric motors. Although many environmentalists say the hybrid is only an interim step, it is a step worth taking until fuel cells are ready for market. It is possible to do well by doing good.