Car Guys Vs. Bean Counters

One major business insight I had observed while reading the first five chapters of this book is that public reputation is critical to business success. For instance, when the competition between Japanese cars and the United States became relevant, the Japanese propaganda assault of lack of social responsibility and Corporate Average Fuel Economy legislation underachievement was detrimental to GM (Lutz 18). When GM was really struggling during the period when Japan was freely manipulating its currency, the United States negotiated a voluntary restraint on Japanese exports. However, when a public study was shown that the domestic car industry took advantage of this period to gouge prices instead of improving product quality, the media labeled its own American car industry as the villains (Lutz 27). Even though this Japanese public study was proven false, the public could did not become sympathetic. Many government officials have openly stated that losing the American car industry would not be such a bad thing since the Japanese car industry was so seemingly robust.

When the global warming discussion became impactful on the car industry, consumers began to look at the American car industry with glaring skepticism. The media condemnation of the SUV was crippling in particular for the domestic car industry since that was the largest domestic market segment for cars. This particularly affected GM who accounted for half of all large SUV sales between 2002 and 2010 (Lutz 38). Furthermore, the disastrous designs that the American car industry was producing the butt of late-night network jokes (Lutz 44). GM’s brand image was particularly tarnished during the release of the Aztek. Its unappealing design cause the car to receive many unappealing jokes by the whole media.

Another major business insight I had observed is that car companies need to be quick to adapt, especially since legislation can have such an incredible impact on the car industry. When the