Sunday, January 11, 2009

America's Foreign Car Fetishism

One of my more enduring complaints about a significant percentage of my fellow citizens is their habit of reflexively buying foreign cars because of a perceived - as opposed to real - difference in Quality between foreign cars and domestic. That is not to say that there are not discriminating purchasers of foreign cars; it is to say, however, that all too often, foreign cars are purchased because they are foreign, and American cars excluded because they are American. For the sake of a convenient shorthand, let us simply describe this phenomenon as "Foreign Car Fetishism", or FCF.

It is also important to understand from the beginning that FCF comes in two flavors: Consumers inspired by a Yuppie trend that started in the 80s, and Car Critics with Esteem issues. While both groups have several traits in common, they have one important difference: Car Critics are invested in perpetuating the Fetish. In fact, their very livelihoods frequently depend on it. Much as Environmentalists would cease to flourish if there was no perception of Global Warming as a problem, the market for Car Critics would narrow severely if America had actually eliminated the so-called Quality gap. After all, what would Car Critics have to editorialize about?

Even more significant, there is a disinclination among Critics to not bite the hand that feeds them, as Foreign car manufacturers become dominant in the advertising segments of the industry, hand out the goodies bags at the trade shows, become a presence in Racing and so on.

Let's review the traits that define Foreign Car Fetishism. You tell me if you know of somebody who fits the description:

- FCFers revere "Quality", however inanely incremental the differences between brands might be. The difference between Toyota and GM twenty years ago was wide in terms of fit, finish, reliability, durability, features, you name it. Now, the difference is extremely narrow, domestic manufacturers having resolutely closed the gap. Still, the FCFers continue to rationalize their bias against The Big Three by pointing out that overall they continue to place behind such as Toyota, Honda and Nissan in overall quality rankings.

But when all six of these manufacturers are mere percentage points apart, at what point does the "quality" argument cease to have any meaning? If American cars as just as safe; if the difference in cabin noise is indistinguishable to the human ear; if the yearly maintenance and repair costs are fifty bucks more for Domestic than Foreign; at some point, isn't the Quality argument moot? At some point, wouldn't you have to at least consider an American-made car?

- FCFers generally know little about American cars, and don't even look at them when researching purchases. They can't cite models, pricing or performance, because they know nothing about the domestic counterparts to foreign automobiles. Their justification is to cite statistics and rhetoric from the 1970s and 80s, and boy, do they love quoting that era. It's as if nothing has changed in twenty years.

- FCFers all revere resale value, unwitting of the fact that their anti-American bias partially drives the perception that drives resale value. Trends driven by perceptions don't change overnight, so don't expect resale values to change overnight. That doesn't mean that American manufactured cars aren't a good deal.

- FCFers love to point out that foreign car companies successfully manufacture quality cars at a lower price in America, compared to The Big Three. It is their ultimate "Gotcha" argument. While there is some truth to the argument, the claims are inflated, to say the least, and have virtually nothing to do with the importation of superior business practices, engineering, or manufacturing techniques. The foreign car companies all set up their plants fairly recently, and States competed with each other to get the business, offering tax breaks, free land and other incentives that the Big Three did not enjoy. And FCFs are generally ignorant of the fact that foreign car companies were given immunity from the UAW by Federal and State governments, further dooming the domestic automobile manufacturers to a perpetual competitive disadvantage.

FCFers buttress the argument above - whilst simultaneously rationalizing their foreign car bias - by also misrepresenting the whole "content" issue. They love to state, falsely, that there's no difference in content; that American cars have as many foreign parts as foreign cars, and foreign cars as much domestic content as American cars. This is willful ignorance at best, and a blatant lie at worst. Toyota and Honda "assemble" some cars here, but mostly manufacture the components elsewhere. Bottom line, foreign car manufacturers continue to import the majority of their content from overseas. American car companies manufacture and assemble the majority of their content here.

- FCFers never acknowledge the deficiencies of foreign cars. For one example, Toyota has taken some huge hits in the past few years, with more recalls than any of the Big Three, yet their consumer ratings have not suffered. How could this be?

- FCFers frequently revile domestic automobiles for their very domesticity. This is very much a Yuppie trend, but picked up by successive generations. Starting in the 70s, there was a Coolness factor to owning something foreign. This was particularly true of the two Coastlines, who had the added incentive of sticking it to the Midwest, with whom they have little in common, culturally speaking.

- FCFers never acknowledge - much less comprehend - that the overhead game has been rigged against American manufacturers of all stripes. For one example, Japan bears the burden of all retirement costs for Toyotas employees in Japan. Give one car company a $1,500 per car advantage on cars sold in America and guess what? The other companies will eventually be out of business. Ironically, Toyota's American employees do NOT have their pension benefits subsidized by the Japanese government. Why not?

- FCFers are generally ignorant of history, much less sociological trends. Korean, Japanese and German folks are culturally disinclined from purchasing foreign produced goods at the expense of domestic producers; they are willing to make a small sacrifice so as to benefit their domestic industries. Americans have no such scruples, so our world market share is smaller. What other countries understand that Americans do not is that nationalism matters, and that economies of scale matter. You need a piece of the foreign car market for your domestic industry to survive. Only America is not so entitled.

- Compared to America, most foreign countries continue to have significant trade barriers to the importation of American manufactured goods, including automobiles. America has far lower trade barriers overall, including cars. The net result is that American manufacturers suffer yet another economies-of-scale disadvantage. The bitter irony of this reality is that if America had access to as much of the worldwide automotive market as do the Japanese, Koreans and Germans, that we would generate the economies of scale that make improvements in quality possible.

The Net of all this is that American car companies - as is the case with much of American industry - are at a disadvantage for a number of reasons, most of which are outside their control. That's not the popular perception, however. The Big Three is merely the poster child for a presumption on the part of FCFers that American manufacturers don't compete well because the companies - and their employees - suck. And of course, what most FCFers have in common is that they are not employed in industries that have - as the Big Three do - foreign competition. Mostly employed by the protected industries that can still afford to pay a wage that allows the purchase of automobiles, they increasingly purchase foreign cars.

What gripes me about FCFers most in this respect is their assumption that they are so very different from their fellow Americans that do compete against the Japanese, Koreans and Germans. I'll buy that assumption the minute that Government employees, teachers, Health Care workers, Lawyers, Accountants and most other Service Industry employees have some significant foreign competition. Let's see how well they stack up; let's see them lose market share and have their share values, jobs and wages threatened; then we can talk.

The Big Question, after acknowledging that Foreign cars generally are still better than their American counterparts - albeit much less so than a generation ago - is this: Is there any price you'd be willing to pay to employ your fellow Americans? Is there any sacrifice of Quality, however small, you'd be willing to endure?

For a lot of Americans, that question drives their purchasing decisions. For most FCFers, it seems to matter not at all; only one reason among many that our economy is in the tank.

One final observation: the biggest Foreign Car Fetishists, without a doubt, are Democrats, while redneck Republicans are the ones "buying American". This strikes me as funny, given that the ones taking it in the neck for America's worship of imports are American workers. Aren't Democrats supposed to be the party that supports workers? Aren't Republicans the party that supports evil corporations?

Why in God's name does the UAW support the Democrat Party?

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