Friday, May 15, 2009

Automobile Bankruptcy(s)

Chrysler's bankruptcy filing has done nothing but continue to operate in a dysfunctional matter, continuing to put bad product on the market, into over saturated distribution system, and expecting different results. Politically and practically it may make sense, as it creates a soft landing for Detroit. However, my concern is that it is a battle without an exit plan. They are going to sell the good assets of Chrysler to Fiat, hoping that Fiat will continue to utilize it's suppliers, but then the word is that it will continue to operate in bankruptcy for years. This is an expensive way run a business. Good for lawyers, not good for anyone else. The reality is that what business continues to rely on the same technology it had almost 100 years ago. It would be like if computers still were using vacuum tubes to power computers. The reality is if the current infrastructure continues to be propped up, there will be no radical change in technology. A better solution would have been to national the industries through radical changes in technology. Before you call me a socialist, the government is already paying the executives and the expenses of the bankruptcy, and this would not be a substantial difference. It would allow for a cohesive strategy for rapid technological advancement.

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