Brandes Elitch on AutoExtremist Rants

Column by Brandes Elitch

As an automobile enthusiast, even if you are living outside of the US, you are likely very concerned about the viability of the auto business today. Not just because you are interested in automobile design, but because this business is such a big part of our Gross Domestic Product, and that of our two neighbors, Canada and Mexico. It is likely that what is going on now in Washington will affect you personally at some point.

Fortunately, there is a clear voice in the wilderness of our news coverage, a writer named Peter de Lorenzo, aka PMD. He has had a 22-year career in automotive marketing and advertising, and he grew up in Detroit during what he calls the “glory days” of the American auto industry (the sixties). He says that the greatest days for Detroit were in the fifties, sixties, and early seventies. That is when, at least in my view, the most desirable and collectible American cars were made.

In June 1999 he started Autoextremist.com – a weekly Internet magazine devoted to news, commentary and analysis of the auto industry. Along with our own VeloceToday, established in 2001, Autoextremist was one of the first online automotive columns/magazines.

He covers not just what is happening in Detroit, but also automotive history, racing, and motorsports. PMD is a compelling writer. Some people might call him controversial, but I don’t because I generally believe he is correct and accurate in his observations, and I usually agree with him. He has referred to the domestic auto industry as “a seething cauldron of brilliance, punctuated by flat-out incompetence.”

He says, “From Day One, the real essence of Autoextremist.com was the fact that I said what others were merely thinking, or would only discuss in “deep background,” and in “off the record” conversations… Born out of a defiance and frustration with the status quo that I believed was stifling creativity and squeezing the very life out of the automobile business, particularly as practiced here in the Motor City, and then fueled by my passion and vision for how great the business could become again…”

Back to our lead paragraph, on March 9, he wrote, “The production and distribution of vehicles from Canada and Mexico is so ingrained in the fundamental structures of these companies that to systematically disrupt it or try to end it altogether would simply destroy these companies and their suppliers in one fell swoop.”

Think about this for a minute. Then consider what he wrote this week (March 23):

Detroit. That these are strange days indeed for the U.S. automobile industry is no secret. Looming, nonsensical tariffs, a severely faltering economy and a giant black cloud hovering over consumer confidence are adding up to be the most ominous list of negative factors facing the industry since The Great Recession. My informal polling of local dealers around here suggest that they’re scared. There is simply no better descriptor of their mood.

All of that is a lot, but the news that BYD in China launched a BEV charging system that fully charges one of its EVs in five minutes sent shock waves through the industry last week.

Even though we knew this day was coming – I, frankly, thought it was years away – it is indeed sobering news. Between being able to recharge in the time it takes to fill up a gas tank and the next-gen, long-range, solid state batteries that are on the way, the pace of BEV development in China (Japan and Korea too) is staggering. That this is pivotal for the future of the automobile industry is undeniable, and it will have repercussions here and around the world.

But the most sobering news is that I don’t see the U.S. manufacturers being able to compete with this accelerated BEV development that’s going on in China, at all. They’re just not there. Yes, they have made huge strides in a short amount of time, but nothing approaching the pace of what’s happening in China.

What’s going on right now is more than a cautionary tale for U.S.-based automakers. It is a warning that the center of the global automobile industry has fundamentally shifted to China. Yes, this has been discussed – and warned about – many times before, but the new and ugly reality brought on by the scorching pace of BEV development is that the U.S. automakers are officially Sideshow Bobs in the overall scheme of things.

Of course, the industry has faced disaster before, in the Great Depression of the thirties, which wiped out so many automakers, and more recently the bankruptcy of Ford and General Motors. In 1954 Ford and GM had a 78% market share (what happened to antitrust work then?) and they proceeded with a price war that ultimately eliminated their competitors except for Chrysler and American Motors. During the seventies there were product disasters, which led a large segment of the American public to vow that not only would they never buy a Chevy again, but they would also never buy an American car again. Not to digress, but families that would have followed the Sloan path upwards from Chevy to Cadillac lived with the 1960 Corvair, the 1971 Vega, the 1980 Citation, the Cadillac Cimmaron, the Olds diesels, the Cadillac 4-6-8 motor, etc. This is not to say that Ford and Chrysler did not make mistakes, but back then GM thinking and market share dominated the industry. Now we have multi-generation families who have never owned an American car.

I cannot predict the future, but we have faced some pretty dreadful situations before and somehow come through. Who in their right mind would have predicted in 1970 that GM, a firm that in the sixties had a 50% market share and was the biggest corporation in the world, would one day file bankruptcy? And who would have predicted ten years ago that Cadillac is now a world class car, on equal footing with the Bosch and, along with the Corvette, on equal footing with Ferrari?

Meanwhile, I suggest you give PMD a try. A weekly column usually has 4 main parts, aside from reader mail. The body is called “Rants.” Other sections are called “On the Table,” (covering current news) “Fumes,” (now a new series called “The Great Races,”) and “the Line.” (this week a feature on MotoGP great marc Marquez). There is also a Song of The Week.

PMD has also written 2 books: “Witch Hunt” (2011) (OctanePresswitchhuntbook.com) and another called “The United States of Toyota.” While he regularly calls out industry management in surprisingly dramatic and powerful castigations, he is always highlighting what he calls the “true believers,” the best and the brightest and the most dedicated, who are still out there, trying to redeem their companies and their products. That is what gives him and the rest of us hope.

https://www.autoextremist.com/