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Crash Course: The American Automobile Industry's Road to Bankruptcy and Bailout-and Beyond
“A definitive account . . . It’s hard to imagine anyone better than Paul Ingrassia to ‘ride shotgun’ on a journey through the sometimes triumphant, often turbulent, history of U.S. automaking. . . . [A] wealth of amusing, astonishing and enlightening nuggets.”— Pittsburgh Tribune-Review
This is the epic saga of the American automobile industry’s rise and demise, a compelling story of hubris, missed opportunities, and self-inflicted wounds that culminates with the president of the United States ushering two of Detroit’s Big Three car companies—once proud symbols of prosperity—through bankruptcy. With unprecedented access, Pulitzer Prize winner Paul Ingrassia takes us from factory floors to small-town dealerships to Detroit’s boardrooms to the White House. Ingrassia answers the big questions: Was Detroit’s self-destruction inevitable? Why did Japanese automakers manage American workers better than the American companies themselves did? Complete with a new Afterword providing fresh insights into the continuing upheaval in the auto industry—the travails of Toyota, the revolving-door management and IPO at General Motors, the unexpected progress at Chrysler, and the Obama administration’s stake in Detroit’s recovery— Crash Course addresses a critical question: America bailed out GM, but who will bail out America?
With an updated Afterword by the author
Praise for Crash Course
“In order to understand just how much of a mess it was—not to mention how it got that way and how, if at all, it can be cleaned up—you really need to read Crash Course .” — The Washinton Post
“Ingrassia tells Detroit’s story with economy, vigour and restrained fury.” — The Economist
“A delightful mix of history and first-person reporting . . . Employing superb storytelling skills, Ingrassia explains in head-shaking detail the elements of a wholly avoidable collision.” — Kirkus Reviews (starred review)
This is the epic saga of the American automobile industry’s rise and demise, a compelling story of hubris, missed opportunities, and self-inflicted wounds that culminates with the president of the United States ushering two of Detroit’s Big Three car companies—once proud symbols of prosperity—through bankruptcy. With unprecedented access, Pulitzer Prize winner Paul Ingrassia takes us from factory floors to small-town dealerships to Detroit’s boardrooms to the White House. Ingrassia answers the big questions: Was Detroit’s self-destruction inevitable? Why did Japanese automakers manage American workers better than the American companies themselves did? Complete with a new Afterword providing fresh insights into the continuing upheaval in the auto industry—the travails of Toyota, the revolving-door management and IPO at General Motors, the unexpected progress at Chrysler, and the Obama administration’s stake in Detroit’s recovery— Crash Course addresses a critical question: America bailed out GM, but who will bail out America?
With an updated Afterword by the author
Praise for Crash Course
“In order to understand just how much of a mess it was—not to mention how it got that way and how, if at all, it can be cleaned up—you really need to read Crash Course .” — The Washinton Post
“Ingrassia tells Detroit’s story with economy, vigour and restrained fury.” — The Economist
“A delightful mix of history and first-person reporting . . . Employing superb storytelling skills, Ingrassia explains in head-shaking detail the elements of a wholly avoidable collision.” — Kirkus Reviews (starred review)
336 pages, Paperback
First published December 15, 2009
46 people are currently reading
633 people want to read
About the author
Paul Ingrassia
13 books10 followersPaul Ingrassia was an American Pulitzer Prize-winning journalist who served as managing editor of Reuters from 2011 to 2016.
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Displaying 1 - 30 of 73 reviews
August 10, 2012
Basically the story of how the US "big three" automakers came to grief in 2008/9, with GM and Chrysler winding up in bankruptcy and Ford narrowly averting this fate. There's a fairly extensive "backstory" going back to the time of Henry Ford to explain how the Big Three developed the corporate culture that would eventually bring them down, but the main emphasis is on the decisions starting in the 1990's that led the Big Three to rely pretty much exclusively on the profits from pickups and SUV's, while they lost money on regular cars. This situation was barely tolerable when the price of gasoline was low, but led to catastrophic failure when the price rose finally.
The main problem according to the author was complacency in management, ridiculous demands from the UAW (like the "Jobs Bank" that paid employees without work to do to be paid 95% of their previous salary), and the refusal of management to confront the glaring problems. The book is written by a journalist, and this definitely shows. The story tends to be presented via the main personalities (the CEO's of the various companies and the head of the UAW) and a few minor ones (the owner of a car dealership in ME and a worker in IL), and there's not so much in the way of abstract analysis. The language that it's written also has the "breezy" feel of the automotive section of a newspaper rather than the formal prose of an academic work.
The book is surprisingly thin on the mechanics of the actual "bailout" process under the Obama administration, and it's clearly not written from a political perspective. That is, there isn't much analysis of why exactly the decisions that were taken (e.g., to "save" both GM and Chrysler rather than let them go through the regular bankruptcy process) were taken. The account is generally favorable to the administration's decisions, though without being too partisan about it. However, the justification for screwing over GM's bondholders is specious.
On the whole, an "easy" read, but not very deep.
The main problem according to the author was complacency in management, ridiculous demands from the UAW (like the "Jobs Bank" that paid employees without work to do to be paid 95% of their previous salary), and the refusal of management to confront the glaring problems. The book is written by a journalist, and this definitely shows. The story tends to be presented via the main personalities (the CEO's of the various companies and the head of the UAW) and a few minor ones (the owner of a car dealership in ME and a worker in IL), and there's not so much in the way of abstract analysis. The language that it's written also has the "breezy" feel of the automotive section of a newspaper rather than the formal prose of an academic work.
The book is surprisingly thin on the mechanics of the actual "bailout" process under the Obama administration, and it's clearly not written from a political perspective. That is, there isn't much analysis of why exactly the decisions that were taken (e.g., to "save" both GM and Chrysler rather than let them go through the regular bankruptcy process) were taken. The account is generally favorable to the administration's decisions, though without being too partisan about it. However, the justification for screwing over GM's bondholders is specious.
On the whole, an "easy" read, but not very deep.
February 11, 2019
This is the epic saga of the American automobile industry's rise and demise, a compelling story of hubris, denial, missed opportunities, and self-inflicted wounds that culminates with the president of the United States ushering two of Detroit's Big Three car companies—once proud symbols of prosperity—through bankruptcy. The cost to American taxpayers topped $100 billion—enough to buy every car and truck sold in America in the first half of 2009. With unprecedented access, Pulitzer Prize winner Paul Ingrassia takes us from factory floors to small-town dealerships to Detroit's boardrooms to the inner sanctums of the White House. He reveals why President Barack Obama personally decided to save Chrysler when many of his advisors opposed the idea. Ingrassia provides the dramatic story behind Obama's dismissal of General Motors CEO Rick Wagoner and the angry reaction from GM's board—the same people who had watched idly while the company plunged into penury.
A very enjoyable read about the fall of the "Big Three" car manufacturers - GM, Ford, & Chrysler. It takes us back through the roller-coaster of success and failure of them all. The introduction of Japanese cars into the American market. The failure of the Detroit companies to change with the times, instead they wanted to continue to live the lavish lifestyles they had, unaware that disaster was coming ever closer. It tells of the influence the UAW had in the early years, and then the growing power they exerted over the car companies, increasing the yearly expenditure of billions of dollars. It talks of the politicians who sat on their hands, who tried to do something, then sat on their hands some more...and then were finally forced to do something.
But most of all this is a book about people across the board who would not move with the times, who would not adapt to the circumstances and wouldn't listen to any advice. 2 of these 3 companies went bankrupt. That's what happens when your pig-headedness and stubbornness to stick with the "It always worked for us before" line finally plays out.
The reason this didn't get 5-stars is that there is a lot of repetition in this book. Mostly small details that gets annoying after a while.
But otherwise, I recommend this for anyone with a passing history in motoring history.
Paul
ARH
A very enjoyable read about the fall of the "Big Three" car manufacturers - GM, Ford, & Chrysler. It takes us back through the roller-coaster of success and failure of them all. The introduction of Japanese cars into the American market. The failure of the Detroit companies to change with the times, instead they wanted to continue to live the lavish lifestyles they had, unaware that disaster was coming ever closer. It tells of the influence the UAW had in the early years, and then the growing power they exerted over the car companies, increasing the yearly expenditure of billions of dollars. It talks of the politicians who sat on their hands, who tried to do something, then sat on their hands some more...and then were finally forced to do something.
But most of all this is a book about people across the board who would not move with the times, who would not adapt to the circumstances and wouldn't listen to any advice. 2 of these 3 companies went bankrupt. That's what happens when your pig-headedness and stubbornness to stick with the "It always worked for us before" line finally plays out.
The reason this didn't get 5-stars is that there is a lot of repetition in this book. Mostly small details that gets annoying after a while.
But otherwise, I recommend this for anyone with a passing history in motoring history.
Paul
ARH
April 19, 2010
Even though nothing in this book was a real surprise, I loved that all of the information surrounding the auto company bailout was tied up neatly into one small, concise, package. Being from the Detroit area (and now living in Connecticut), I experienced, first-hand, the effects of the UAW and the missmanagement of General Motors. Hopefully everyone has learned their lesson - but I'm not betting on it.
October 6, 2023
Great unbiased review of the history of the automotive industry! Author shares the frank truth about all aspects of the rise and fall of the big three.
February 9, 2010
If you felt that auto execs made stupid mistakes over the past few decades, you were right. If you feel that the UAW was detrimental in building good cars, you were right.
Here are just three examples:
1. In 2003, General Motors was spending $800,000,000 a year on employees in the 'Job Bank.' This so-called bank was for employees that were laid off for any reason, including plant shutdowns. This went on for years. People making $70k+ a year and doing nothing.
2. Also in 2003, 70% of GM's profits were from sub-prime home loans. Yep, these are the same sub-prime loans that undercut our economy. The other 30% of GM's profits were from large trucks and big SUVs. They decided to double-down--more sub-prime and BIGGER SUVs and trucks.
3. A key exec of the UAW often said, "Our job is to make sure that General Motors managers can't manage."
Each exec, management or labor, felt that this perfect storm would happen on somebody elses watch.
The book is fascinating, starting from the early days of GM and Ford and coming to the present where Obama's team spent $100 billion to prop up the Detroit auto companies. There's a lot of insider stuff here. The author is a Wall Street Journal reporter based in Michigan.
Here are just three examples:
1. In 2003, General Motors was spending $800,000,000 a year on employees in the 'Job Bank.' This so-called bank was for employees that were laid off for any reason, including plant shutdowns. This went on for years. People making $70k+ a year and doing nothing.
2. Also in 2003, 70% of GM's profits were from sub-prime home loans. Yep, these are the same sub-prime loans that undercut our economy. The other 30% of GM's profits were from large trucks and big SUVs. They decided to double-down--more sub-prime and BIGGER SUVs and trucks.
3. A key exec of the UAW often said, "Our job is to make sure that General Motors managers can't manage."
Each exec, management or labor, felt that this perfect storm would happen on somebody elses watch.
The book is fascinating, starting from the early days of GM and Ford and coming to the present where Obama's team spent $100 billion to prop up the Detroit auto companies. There's a lot of insider stuff here. The author is a Wall Street Journal reporter based in Michigan.
January 19, 2010
A good overview of the rise and fall of the American auto industry, with a quick look at the history and an in-depth look at the last couple decades, especially on the collapse and bailout. It's evenhanded, assigning blame to the companies, the UAW, the government, and other parties. It's easy to read and understandable even if you aren't a finance or car person. There are lots of places I wish it went a little more in depth, but that's the cost of exchanging breadth for depth.
One minor but annoying error - in several places the author refers to the "Dodge Aspen" when talking about Chrysler Corp's large SUV. The vehicle is actually the Chrysler Aspen - it's a badge-engineered version of the Dodge Durango SUV built for Chrysler dealers. The Dodge Aspen was a mid-sized car built in the late 70's. A minor error, but surprising in a book as well-endnoted as this one.
One minor but annoying error - in several places the author refers to the "Dodge Aspen" when talking about Chrysler Corp's large SUV. The vehicle is actually the Chrysler Aspen - it's a badge-engineered version of the Dodge Durango SUV built for Chrysler dealers. The Dodge Aspen was a mid-sized car built in the late 70's. A minor error, but surprising in a book as well-endnoted as this one.
January 29, 2011
You can sum up the car companies and union in one word: idiots.
December 4, 2012
it's hard to decide if you hate unions or executives or legislators more at the end of this book.
February 17, 2019
Engaging audiobook but with such a strong anti-union bent to make the coverage of the issue— Detroit’s auto meltdown — one sided.
September 20, 2020
Crash Course is about the rise and fall, and rise and fall …
and rise
and fall
and rise
and fall
and rise and fall ……………. and ……………. (you get the idea) of the American automotive industry: Ford, Chrysler and General Motors.
Pulitzer Prize-winning journalist Paul Ingrassia describes the industry from the days of the Fork Model-T to the 2008 Federal Government’s $80.7 billion bailout of Chrysler and GM following the global financial crisis. He pins the cause of the repeated booms-and-busts on a tremendous amount of complacency within the industry, coupled with bad management and unsustainable benefits granted to members of the United Auto Workers union. His treatment struck me as balanced with both management and labor sharing part of the blame.
Ingrassia has a lively and engaging writing style that kept, what could have been a rather dull topic, interesting throughout. Though I did think he went into rather too much detail about the minutia of the 2008 bailout under Obama. At the time the book was published it wasn’t clear whether the action would be successful. Most independent analysis points to success:
- The Feds got much, though not all, of their money back
- Hundreds of thousands of jobs were saved
- The industry is once again profitable
and rise
and fall
and rise
and fall
and rise and fall ……………. and ……………. (you get the idea) of the American automotive industry: Ford, Chrysler and General Motors.
Pulitzer Prize-winning journalist Paul Ingrassia describes the industry from the days of the Fork Model-T to the 2008 Federal Government’s $80.7 billion bailout of Chrysler and GM following the global financial crisis. He pins the cause of the repeated booms-and-busts on a tremendous amount of complacency within the industry, coupled with bad management and unsustainable benefits granted to members of the United Auto Workers union. His treatment struck me as balanced with both management and labor sharing part of the blame.
Ingrassia has a lively and engaging writing style that kept, what could have been a rather dull topic, interesting throughout. Though I did think he went into rather too much detail about the minutia of the 2008 bailout under Obama. At the time the book was published it wasn’t clear whether the action would be successful. Most independent analysis points to success:
- The Feds got much, though not all, of their money back
- Hundreds of thousands of jobs were saved
- The industry is once again profitable
May 19, 2010
Though this book was obviously slapped together quickly after GM and Chrysler fell into bankruptcy, it still provides a good, succinct history of the American auto industry combined with an interesting in-depth look at the last 10 years of rapid decline and eventual bankruptcy.
The first thing to note is that the scale of the auto industry's failure is truly astounding. The Big Three auto companies managed to lose almost $100 billion dollars between them in just four years time, which means they destroyed or squandered the equivalent of all the wealth produced by the entire state of Vermont in that period. And almost exactly $100 billion was eventually provided to the companies by Bush and Obama (well, US taxpayers through Bush and Obama), meaning almost a thousand dollars for every working man and woman in America, most of it poured in with no more than crossed fingers that the endless burn would stop. Most of it's not coming back.
A Wall Street Journal reporter, Ingrassia obviously tries to be even-handed, sharing the blame for the failure equally between management and labor, and I'll admit that after reading the book that management certainly looks worse than I thought. The private jets they took to the congressional hearing were only one indication of a general problem. At one point, during serious contract negotiations with the union where the company pled poverty, management had a helicopter air-lift a Persian rug into executive offices because it wouldn't fit in the elevator. GM even had segregated bathrooms for executives and hourly employees. This is just part of a mindless status pissing contest that certainly hurt the company in labor negotiations (especially after egalitarian Honda executives began wearing workers' jumpsuits and working off the factory floor itself). Also, many management deals, like GM's partial purchase of Fiat, seemed intended mainly to build empires rather than increase profitability.
But it's the UAW that is clearly at the root of most of the companies' ills. Ingrassia most frequent complaint about management is that they refused to stand up to the union, which is like blaming a crime victim for not standing up to his mugger.
In 1970, after a 67 day strike the union earned the right to "30 and out," meaning someone who started working at 18 could retire at full pension by 48, with free health care with no co-pays or deductibles for the rest of his or her natural life. The union contracts created dozens of work categories in every plant, meaning even tightening a lug nut could hold up an entire factory for hours if the appropriate machinist wasn't there. Some plants had production schedules that could be finished in just 3 or 4 hours, meaning everything else was overtime, and workers could get hours of it even if their day was only 7 hours long. The union also helped write the CAFE standard in 1975, so that most of the small, gas-efficient cars that the companies were now required to build would have to be built in the US, even though the union's rules and wages almost ensured that these would be unprofitable.
The Jobs Bank, created in 1984 contract negotiations and made permanent in 1990, is the most egregious example of UAW intransigence. At the Jobs Bank, workers would wait, sometimes for years, doing nothing at 95% pay if there was no work for them. This led to "inverse layoffs," where more senior workers would agree to be "laid off" and go to the Jobs Bank in order to take a break and push less senior workers back into the workforce. Everyone should haver realized that this was crazy. But the union was one of the most militant in America. Their official song, "Solidarity Forever," sung to the tune of the Battle Hymn of the Republic, was an almost Marxist chant ("They have taken untold millions that they never toiled to earn...We can break their haughty power, gain our freedom when we learn"). Every factory had scores of UAW organizers and representatives that were actually paid by the companies themselves just like hourly employees but did nothing except field complaints against them.
Numerous attempts to work around the union failed. The 1985 Saturn agreement (negotiated by GM executive Roger Smith, of Michael Moore's "Roger and Me" fame) tried to give bonuses for productivity and limit the number of job classifications in the Tennessee plant to less than 10 (instead of dozens), but by 1994 UAW's new militant leader Stephen Yokich succeeded in overturning the Saturn contract and having it revert back to the old unprofitable mean. In 1998 GM sued UAW for striking without one of the causes specified in the contract, and for a moment it looked like the might win, and the court reimbursements might bankrupt the union entirely, but a day before the judge was to rule, GM pulled the lawsuit, claiming that it would only leave embittered workers. Still, waiting one more day might have saved billions of dollars 10 years before the company's eventual fall. The executives were just too cowered to try it.
Most of Ingrassia's original research concerns the negotiations in 2008 and 2009 between the government and GM and Chrysler, where both management and labor unions continued to seem blindingly oblivious to the freight train heading their way. Ultimately, the government compelled TARP-owned banks to write off billions in bond holdings and then it gave large equity shares in GM and Chrysler to both itself and the UAW's health care fund, in exchange for some concessions concerning wages for new workers. Most of Ingrassia's interviews are with unattributed Auto Task Force members (probably Ron Bloom and Stephen Rattner) so his story is definitely slanted their way. Ingrassia seems to be hopeful that their negotiations will give the companies a real second chance, but the UAW's continuing power makes me suspicious.
The first thing to note is that the scale of the auto industry's failure is truly astounding. The Big Three auto companies managed to lose almost $100 billion dollars between them in just four years time, which means they destroyed or squandered the equivalent of all the wealth produced by the entire state of Vermont in that period. And almost exactly $100 billion was eventually provided to the companies by Bush and Obama (well, US taxpayers through Bush and Obama), meaning almost a thousand dollars for every working man and woman in America, most of it poured in with no more than crossed fingers that the endless burn would stop. Most of it's not coming back.
A Wall Street Journal reporter, Ingrassia obviously tries to be even-handed, sharing the blame for the failure equally between management and labor, and I'll admit that after reading the book that management certainly looks worse than I thought. The private jets they took to the congressional hearing were only one indication of a general problem. At one point, during serious contract negotiations with the union where the company pled poverty, management had a helicopter air-lift a Persian rug into executive offices because it wouldn't fit in the elevator. GM even had segregated bathrooms for executives and hourly employees. This is just part of a mindless status pissing contest that certainly hurt the company in labor negotiations (especially after egalitarian Honda executives began wearing workers' jumpsuits and working off the factory floor itself). Also, many management deals, like GM's partial purchase of Fiat, seemed intended mainly to build empires rather than increase profitability.
But it's the UAW that is clearly at the root of most of the companies' ills. Ingrassia most frequent complaint about management is that they refused to stand up to the union, which is like blaming a crime victim for not standing up to his mugger.
In 1970, after a 67 day strike the union earned the right to "30 and out," meaning someone who started working at 18 could retire at full pension by 48, with free health care with no co-pays or deductibles for the rest of his or her natural life. The union contracts created dozens of work categories in every plant, meaning even tightening a lug nut could hold up an entire factory for hours if the appropriate machinist wasn't there. Some plants had production schedules that could be finished in just 3 or 4 hours, meaning everything else was overtime, and workers could get hours of it even if their day was only 7 hours long. The union also helped write the CAFE standard in 1975, so that most of the small, gas-efficient cars that the companies were now required to build would have to be built in the US, even though the union's rules and wages almost ensured that these would be unprofitable.
The Jobs Bank, created in 1984 contract negotiations and made permanent in 1990, is the most egregious example of UAW intransigence. At the Jobs Bank, workers would wait, sometimes for years, doing nothing at 95% pay if there was no work for them. This led to "inverse layoffs," where more senior workers would agree to be "laid off" and go to the Jobs Bank in order to take a break and push less senior workers back into the workforce. Everyone should haver realized that this was crazy. But the union was one of the most militant in America. Their official song, "Solidarity Forever," sung to the tune of the Battle Hymn of the Republic, was an almost Marxist chant ("They have taken untold millions that they never toiled to earn...We can break their haughty power, gain our freedom when we learn"). Every factory had scores of UAW organizers and representatives that were actually paid by the companies themselves just like hourly employees but did nothing except field complaints against them.
Numerous attempts to work around the union failed. The 1985 Saturn agreement (negotiated by GM executive Roger Smith, of Michael Moore's "Roger and Me" fame) tried to give bonuses for productivity and limit the number of job classifications in the Tennessee plant to less than 10 (instead of dozens), but by 1994 UAW's new militant leader Stephen Yokich succeeded in overturning the Saturn contract and having it revert back to the old unprofitable mean. In 1998 GM sued UAW for striking without one of the causes specified in the contract, and for a moment it looked like the might win, and the court reimbursements might bankrupt the union entirely, but a day before the judge was to rule, GM pulled the lawsuit, claiming that it would only leave embittered workers. Still, waiting one more day might have saved billions of dollars 10 years before the company's eventual fall. The executives were just too cowered to try it.
Most of Ingrassia's original research concerns the negotiations in 2008 and 2009 between the government and GM and Chrysler, where both management and labor unions continued to seem blindingly oblivious to the freight train heading their way. Ultimately, the government compelled TARP-owned banks to write off billions in bond holdings and then it gave large equity shares in GM and Chrysler to both itself and the UAW's health care fund, in exchange for some concessions concerning wages for new workers. Most of Ingrassia's interviews are with unattributed Auto Task Force members (probably Ron Bloom and Stephen Rattner) so his story is definitely slanted their way. Ingrassia seems to be hopeful that their negotiations will give the companies a real second chance, but the UAW's continuing power makes me suspicious.
January 22, 2020
Its ironic that the big three keep repeating their same mistakes every 20 years or so (doubling down on SUVS, not being progressive in the industry).
Well researched and written with a smooth narrative, but the author puts way too much blame of the big three's problems on the union. Yes, the UAW has a lot of problems, but there is an ethical argument to be made that workers deserve pensions and healthcare without deductibles or other costs. A lot of space is dedicated to the issue of the union's job banks, but why should workers be punished by losing jobs/not getting paid for management's mistakes, especially since it is made clear the union has no say in how the companies are run.
Well researched and written with a smooth narrative, but the author puts way too much blame of the big three's problems on the union. Yes, the UAW has a lot of problems, but there is an ethical argument to be made that workers deserve pensions and healthcare without deductibles or other costs. A lot of space is dedicated to the issue of the union's job banks, but why should workers be punished by losing jobs/not getting paid for management's mistakes, especially since it is made clear the union has no say in how the companies are run.
April 10, 2022
A well written book about the history of the auto industry leading up to its huge failures in 2008. Sad story. But it could have also been written about the steel industry and the USW and it’s fall from grace similar to the auto industry. Excessive contracts and bad management. Poor quality that wasn’t recognized until the Japanese were becoming dominant by 1980. Good history book for anyone interested in the automobile industry and its once dominant position in the US and the world. I still recall the old Blood Swear and Tears song from 1969 when being president of General Motors was the most prestigious job in America.
December 31, 2024
This is a pretty well written account of the auto industry’s 2008 collapse as well as the years of poor management that led to it. Ingrassia focuses heavily on the internal politics of America’s “big 3”, portraying Detroit as a slow moving, oversized, and often corrupt business environment compared with their more efficient foreign competitors. As far as recounting this story, I somewhat prefer Keith Bradsher’s “High and Mighty” which is a bit more detailed in terms of car design changes and less forgiving of Detroit. Otherwise, Crash Course is an excellent book, but a bit too focused on internal happenings many readers won’t find too interesting.
April 14, 2020
This is an outstanding book about the American auto industry, from its earliest roots, its ascent, and its decline, culminating in the financial crisis of the late 2000’s. The author makes it all interesting and easy to understand. The thing I like best is this story is balanced- the mismanagement of the auto companies, the greed of the UAW, the effects of globalization and Japanese imports, Americans' shifting tastes, often influenced by the cost of gas, etc. It’s all there. Highly recommended.
December 26, 2016
A fabulous 'read' by way of Audible as we coursed first westward for Christmas, then turned back and retraced our steps.
This book is a fairly transparent history of 'The Big Three' and their downward spiral to the financial crisis and (excepting Ford) bailouts and bankruptcies.
We'd love a follow-up, but what is the next big milestone of the automotive industry?
This book is a fairly transparent history of 'The Big Three' and their downward spiral to the financial crisis and (excepting Ford) bailouts and bankruptcies.
We'd love a follow-up, but what is the next big milestone of the automotive industry?
July 27, 2018
Very informative about a topic of which I know little, but the author included considerable opinions within the narrative of the history. I suppose this inclusion of bias is inevitable, and as it is not too flagrant, at least it is obvious and not hidden; but I didn't necessarily feel comfortable with it. Comfort is not always the point. My feelings about this book are complicated. Three stars.
September 12, 2018
Ingrassia does an admirable job of keeping the corporate intrigue interesting in this account of the rise and fall (and rise and fall) of the America automobile industry. His tone rubbed me the wrong way at times; he makes it sound like the errors of executives were obvious at the time rather than imagining why they refused to "change with the times."
July 12, 2021
A very well-done explanation of the auto industry. I particularly enjoyed the information about various models that came and went during my lifetime and the impact the labor unions have had on the industry. Also, it was interesting to hear of how the Japanese automakers came onto the American scene.
May 29, 2022
There's a lot of technical background info here, but if you work in the auto industry or have been following it for years, it's an interesting read. It follows the Big Three car companies, and others to a lesser extent, from their inception to about 2009. I'd like to see a follow up book on info since then.
September 11, 2018
I really enjoyed this book.
January 26, 2019
A very good description of the downfall of American automobile production. This also serves as a warning to other industries with similar internal struggles.
Read
October 22, 2016A great history of the automotive industry and the labor relations. Does neither side any favors!
August 29, 2014
A brisk, informative and concise read…
Ingrassia provides a nuts & bolts (no pun intended) history of the US auto industry, including the 2009 collapse and subsequent bankruptcy of Chrysler and General Motors. Despite the United Auto Workers parasitic (vampiric?) role in said collapse, plenty of blame is assigned to the executives that resisted change until catastrophe loomed.
The Halcyon days of the early auto giants is recounted in chronological order with numerous interesting anecdotes, but make no mistake; It’s all about the cars and Ingrassia takes the reader on a tour of the many models of cars and pickup trucks (both successful and unsuccessful) that shaped and signified the 20th century American culture and society. Middle class mobility for early auto workers was jump-started (pun intended) by Henry Ford’s early manufacturing and wage innovations. Couple these early manufacturing jobs with the rapidly expanding interstate highway network and America was poised for historic economic growth and prosperity. If those changes weren’t enough, the aftermath of World War II brought home the greatest generation which, along with the GI bill catapulted the USA to even greater economic heights. Despite these developments, an often violent labor movement demanded more and more wage increases and financial security for life.
So long as the competing car companies could afford to make concessions, management tended to acquiesce after some haggling and negotiation. However, as the book makes clear, when labor wasn’t satisfied and a strike was declared, things tended to get ugly and contentious. The UAW gained tremendous power through a mix of successful strikes (the sit-down strike of 1937) and exceptional leaders like Walter Reuther and later, Steve Yokich. While the union workers benefitted greatly from these victories, there is little doubt that the auto companies (not to mention car buyers) would have been much better off without them.
As Ingrassia unravels the economics of the automative industry, readers may find themselves asking the following question: Does the average car buyer realize what portion of the new car’s price consists of labor costs, both active and retired? Marketing expenses? Executive pay? Property taxes on the factories themselves?
Major industry upheavals (the 1970’s oil embargo crisis, various safety scandals, etc.) and decades of mismanagement and union domination culminate in the mergers and bankruptcies. In the end, the Federal Government had to intervene to prevent these industrial giants from collapsing completely.
The historical lessons are undeniable: Labor costs in any industry must make fiscal sense and management must adapt to changes in the environments and markets within which they strive to compete and survive.
Ingrassia provides a nuts & bolts (no pun intended) history of the US auto industry, including the 2009 collapse and subsequent bankruptcy of Chrysler and General Motors. Despite the United Auto Workers parasitic (vampiric?) role in said collapse, plenty of blame is assigned to the executives that resisted change until catastrophe loomed.
The Halcyon days of the early auto giants is recounted in chronological order with numerous interesting anecdotes, but make no mistake; It’s all about the cars and Ingrassia takes the reader on a tour of the many models of cars and pickup trucks (both successful and unsuccessful) that shaped and signified the 20th century American culture and society. Middle class mobility for early auto workers was jump-started (pun intended) by Henry Ford’s early manufacturing and wage innovations. Couple these early manufacturing jobs with the rapidly expanding interstate highway network and America was poised for historic economic growth and prosperity. If those changes weren’t enough, the aftermath of World War II brought home the greatest generation which, along with the GI bill catapulted the USA to even greater economic heights. Despite these developments, an often violent labor movement demanded more and more wage increases and financial security for life.
So long as the competing car companies could afford to make concessions, management tended to acquiesce after some haggling and negotiation. However, as the book makes clear, when labor wasn’t satisfied and a strike was declared, things tended to get ugly and contentious. The UAW gained tremendous power through a mix of successful strikes (the sit-down strike of 1937) and exceptional leaders like Walter Reuther and later, Steve Yokich. While the union workers benefitted greatly from these victories, there is little doubt that the auto companies (not to mention car buyers) would have been much better off without them.
As Ingrassia unravels the economics of the automative industry, readers may find themselves asking the following question: Does the average car buyer realize what portion of the new car’s price consists of labor costs, both active and retired? Marketing expenses? Executive pay? Property taxes on the factories themselves?
Major industry upheavals (the 1970’s oil embargo crisis, various safety scandals, etc.) and decades of mismanagement and union domination culminate in the mergers and bankruptcies. In the end, the Federal Government had to intervene to prevent these industrial giants from collapsing completely.
The historical lessons are undeniable: Labor costs in any industry must make fiscal sense and management must adapt to changes in the environments and markets within which they strive to compete and survive.
April 12, 2012
Crash Course tells the story of how the Big 3 (GM, Ford, Chrysler) became the Medium 6 (GM, Ford, Toyota, Honda, Fiat-Chrysler, and Nissan). I knew the story of the bankruptcy of GM and Chrysler in general terms but really didn't know many of the specifics. The failure of management to make the hard decisions when it was clear that their cost structure was not sustainable is almost criminal.
A few examples:
-The "job bank" program where auto workers were paid 95% of their salary when a plant was shut down for maintenance or inventory adjustments.
-Workers did not pay anything for their health care insurance nor did they have a co-pay for medical treatment, hell, I lost that benefit 30 years ago.
-Retired executives were given two new cars to drive each year. -Management had zero incentive to control the benefit packages for the UAW since they knew that their benefits would increase by 10% over what the union won.
-Poor quality, dated designs, duplicate and competing brands. Mercury, Pontiac, Oldsmobile, Hummer, Saturn and a few other brands were finally killed but only after bankruptcy was declared.
-The fact that by 2008 there were 10 auto workers who were retired and drawing a pension for every auto worker that was actually working. -The Big 3 were producing gas guzzlers when the price of gas was climbing from $1.00 per gallon to over $3.00 per gallon.
-The Japanese were producing a better product at a lower cost.
The book contains a lot more examples that prove management was not doing its job
What in the hell was the management at Ford,GM and Chrysler doing??? It didn't take a rocket scientist to see that the Big 3 were on the road to perdition.
If there is one hero in this sorry mess it has to be Barack Obama. The commission he appointed to oversee the reorganization of GM and Chrysler had the backbone to make the tough decisions and put the companies back on a path that had a least some chance of succeeding.
They are headed in the right direction but Hyundai and Volkswagen are nipping at their heels and it won't be long before the Chinese and Indians are added to the mix. I only hope the the American auto industry has learned from their past mistakes and has the leaders who will never let their companies become complacent again. We'll see.
A few examples:
-The "job bank" program where auto workers were paid 95% of their salary when a plant was shut down for maintenance or inventory adjustments.
-Workers did not pay anything for their health care insurance nor did they have a co-pay for medical treatment, hell, I lost that benefit 30 years ago.
-Retired executives were given two new cars to drive each year. -Management had zero incentive to control the benefit packages for the UAW since they knew that their benefits would increase by 10% over what the union won.
-Poor quality, dated designs, duplicate and competing brands. Mercury, Pontiac, Oldsmobile, Hummer, Saturn and a few other brands were finally killed but only after bankruptcy was declared.
-The fact that by 2008 there were 10 auto workers who were retired and drawing a pension for every auto worker that was actually working. -The Big 3 were producing gas guzzlers when the price of gas was climbing from $1.00 per gallon to over $3.00 per gallon.
-The Japanese were producing a better product at a lower cost.
The book contains a lot more examples that prove management was not doing its job
What in the hell was the management at Ford,GM and Chrysler doing??? It didn't take a rocket scientist to see that the Big 3 were on the road to perdition.
If there is one hero in this sorry mess it has to be Barack Obama. The commission he appointed to oversee the reorganization of GM and Chrysler had the backbone to make the tough decisions and put the companies back on a path that had a least some chance of succeeding.
They are headed in the right direction but Hyundai and Volkswagen are nipping at their heels and it won't be long before the Chinese and Indians are added to the mix. I only hope the the American auto industry has learned from their past mistakes and has the leaders who will never let their companies become complacent again. We'll see.
May 14, 2010
A good, quick tale of the origins and consequences of the OTHER bailouts in the wake of the Crash of '08, those being the bankruptcies and rescue of two of the Big Three. Ingrassia has long covered the auto industry for the Wall Street Journal, so this book has a lot of depth and back ground for one that was published so soon after the events it describes.
After a brief history of the auto industry and the UAW, Ingrassia turns to the forces that inexorably led to the downfall both of the union and the companies (Ralph Nader, the first nemesis, makes his first appearance on page 43). Ingrassia recites the full liturgy: the Seventies oil embargoes, the CAFE standards (which, madly, only apply to cars manufactured in the US), competition from superior foreign models, increasingly unsustainable pension and health care commitments, and the greed and sclerosis that infected both the UAW and the management suite. When everyone finally realized there was a problem, it was simply too late. This is a tale that has been told many times, but never so succinctly or damningly.
What hasn't really been told before is the final third which deals with the bankruptcies and bailouts. Ingrassia does well introducing the many political players who became intimately involved in GM and Chrysler's operations. If you are a believer in the free market, it can be disquieting to see how a handful of regulators, many with little experience in the auto industry, effectively restructured American auto manufacturing. On the other hand, if you are a believer in the free market, the behavior of the alleged capitalists at GM and Chrysler was frankly embarrassing. Unlike Ford, the two failed companies did little to avoid their fates, except go running to DC demanding a blank check for billions of dollars. I'm not even going to describe what I think of the union leaders who clung to every perk and work rule, even as their companies teetered on the brink of extinction.
This is a very good look at the utter failure to three institutions: GM, Chrysler and the UAW. While the people running those institutions share much of the blame for their fates, it was also intrusive government policy - whether environmental, financial, energy, etc - that really put the nail in the coffin.
After a brief history of the auto industry and the UAW, Ingrassia turns to the forces that inexorably led to the downfall both of the union and the companies (Ralph Nader, the first nemesis, makes his first appearance on page 43). Ingrassia recites the full liturgy: the Seventies oil embargoes, the CAFE standards (which, madly, only apply to cars manufactured in the US), competition from superior foreign models, increasingly unsustainable pension and health care commitments, and the greed and sclerosis that infected both the UAW and the management suite. When everyone finally realized there was a problem, it was simply too late. This is a tale that has been told many times, but never so succinctly or damningly.
What hasn't really been told before is the final third which deals with the bankruptcies and bailouts. Ingrassia does well introducing the many political players who became intimately involved in GM and Chrysler's operations. If you are a believer in the free market, it can be disquieting to see how a handful of regulators, many with little experience in the auto industry, effectively restructured American auto manufacturing. On the other hand, if you are a believer in the free market, the behavior of the alleged capitalists at GM and Chrysler was frankly embarrassing. Unlike Ford, the two failed companies did little to avoid their fates, except go running to DC demanding a blank check for billions of dollars. I'm not even going to describe what I think of the union leaders who clung to every perk and work rule, even as their companies teetered on the brink of extinction.
This is a very good look at the utter failure to three institutions: GM, Chrysler and the UAW. While the people running those institutions share much of the blame for their fates, it was also intrusive government policy - whether environmental, financial, energy, etc - that really put the nail in the coffin.
January 23, 2016
While written by a "finance guy from the newspaper business", he does a good job of capturing the inherent problems of the auto industry, unions, financial connections, etc....he is off on technical information, but it isn't critical to the story. He also misses on some of his stated "executive benefits" which basically are not true (unless he is referring only to Executive VP level), as none of those he mentions were available at even high level executive ranks,(eg director or Sr VP). Again not too relevant to the story.
He misses a great chance to show how the Hubris and Greed of the auto industry, unions, shareholders, and banks, is really a national problem. These attitudes have had a tremendous impact on how most companies do business now, how most folks live their lives, and is responsible for loss of ethics and common sense, as well as the current national crisis on industrial and commercial failures, finance, credit, mortgages, unemployment, lack of savings, etc. Can you say like Gordon Gecko, "Greed is Good!"
This applies to not only government, and other businesses, but to individuals as well (maxed out credit cards, home ownership with mortgages for folks who have no hope of paying them off, desire to have it all with little or no equity ...."greed" and "how much more can for how little effort" I get, have supplanted working diligently and saving to get ahead...so who is really at fault?
Even the shareholders (mom and pop, as well as large funds and retirement accounts) expect huge returns every quarter, or they drop the stock like a hot potato...how can someone run a business with the long view, with focus on the product and customer, civic responsibility etc. while trying to show ever greater quarterly returns all the time, no matter what the economic or business environment? This expectation by "Wall Street" has led to other major melt-downs in very visible industries recently....think Enron?
For businessmen, "Do the right thing" doesn't mean what it used to...now it means how can I show (at least on paper) that things are always better than yesterday?
He misses a great chance to show how the Hubris and Greed of the auto industry, unions, shareholders, and banks, is really a national problem. These attitudes have had a tremendous impact on how most companies do business now, how most folks live their lives, and is responsible for loss of ethics and common sense, as well as the current national crisis on industrial and commercial failures, finance, credit, mortgages, unemployment, lack of savings, etc. Can you say like Gordon Gecko, "Greed is Good!"
This applies to not only government, and other businesses, but to individuals as well (maxed out credit cards, home ownership with mortgages for folks who have no hope of paying them off, desire to have it all with little or no equity ...."greed" and "how much more can for how little effort" I get, have supplanted working diligently and saving to get ahead...so who is really at fault?
Even the shareholders (mom and pop, as well as large funds and retirement accounts) expect huge returns every quarter, or they drop the stock like a hot potato...how can someone run a business with the long view, with focus on the product and customer, civic responsibility etc. while trying to show ever greater quarterly returns all the time, no matter what the economic or business environment? This expectation by "Wall Street" has led to other major melt-downs in very visible industries recently....think Enron?
For businessmen, "Do the right thing" doesn't mean what it used to...now it means how can I show (at least on paper) that things are always better than yesterday?
December 15, 2010
This is a very good read if you enjoy cars and automotive history. Or if you are like me,reading it to reach an understanding of how a giant like GM,who also supplies my pension, could fall into bankruptcy. It is a tragic tale that is worth reading.
The author provides an easy read on a subject that could be very dry and boring. There are many interesting facts you pick up along the way. For example, did you know that Ford was offered the Volkswagen company after WWll for free but turned it down. You got to wonder what if......?
Although I readily agreed with the author's assessment of who and what was to blame for GM's downfall, I wish he would have taken another step and analyzed what might have been if the failures he identified had been changed. Yes, GM should have taken a stand against several UAW demands ,like the Jobs Bank, but they didn't. But why did they not do it? The author argued GM just took the path of least resistance,would pass the costs on to consumers, and just lacked the courage. These explanations are probably true, but what might have been the outcomes if GM had taken a stand? To speculate is risky, but with the author's access to GM personnel, records, and being an astute observer of the auto industry I think he could have done a credible job. The UAW would have gone out on strke with serious economic results, but would the results have been any more serious than they turned out to be? Tracking that arguement into the future would have been a fascinating addition to the book even if risky.
I also wondered if the board of directors really did their job. Yes, they took decisive action in removing R.Stempel, but was that enough throughout the totality of GM's decline. GM management may not have been the only ones lacking vision,courage and perspective.
The author provides an easy read on a subject that could be very dry and boring. There are many interesting facts you pick up along the way. For example, did you know that Ford was offered the Volkswagen company after WWll for free but turned it down. You got to wonder what if......?
Although I readily agreed with the author's assessment of who and what was to blame for GM's downfall, I wish he would have taken another step and analyzed what might have been if the failures he identified had been changed. Yes, GM should have taken a stand against several UAW demands ,like the Jobs Bank, but they didn't. But why did they not do it? The author argued GM just took the path of least resistance,would pass the costs on to consumers, and just lacked the courage. These explanations are probably true, but what might have been the outcomes if GM had taken a stand? To speculate is risky, but with the author's access to GM personnel, records, and being an astute observer of the auto industry I think he could have done a credible job. The UAW would have gone out on strke with serious economic results, but would the results have been any more serious than they turned out to be? Tracking that arguement into the future would have been a fascinating addition to the book even if risky.
I also wondered if the board of directors really did their job. Yes, they took decisive action in removing R.Stempel, but was that enough throughout the totality of GM's decline. GM management may not have been the only ones lacking vision,courage and perspective.
July 3, 2010
The American car companies have always sucked, bad product, bad distribution, bad marketing, bad negotiating etc etc etc. The hubris so thick that for nearly 50 years the American car companies brushed off the invasion of Japanese quality and cost. Consumers have finally had it with shoddy quality cheap worksmanship, and flimsy components. Ingassia's book does a good job of putting it all together from the dawn of the automotive industry to the bailouts in 2008. Ingrassia gets into the 11th hour, where Ford finally got their stuff together while GM and Chrysler maintained the status quo...then gov't endorsed mergers, bankruptcy and bailout. From the casual observence that Ford has improved in quality of product and company performance; the book remains true to the events of the recent crisis.
the book is an easy read but still informative. It may have held on to me more personally as a native of Northern Ohio..heavily invested in automotive and auto supplers. Ingrassia does a nice job of explaining more complicated matters of accounting, financing, and union negotiations.
the book is an easy read but still informative. It may have held on to me more personally as a native of Northern Ohio..heavily invested in automotive and auto supplers. Ingrassia does a nice job of explaining more complicated matters of accounting, financing, and union negotiations.
November 9, 2010
Being extremely uninterested in cars, I had low expectations for this one but found it a very interesting read. Covers mostly the recent history (through bailouts, car czar under Obama, bankruptcies) of the Big Three detroit auto companies, with Japanese companies making cameo appearances for contrast. Aside from missing out on the SUV trend, which I guess was a mixed blessing, the Japanese companies are mainly depicted as savvy, efficient, forward-thinking, the American companies as dumb, ponderous, and stubborn. Both management and labor unions absorb hits in the book, notably for failing to realize they were ruining a good thing by fighting it out with each other relentlessly.
One detail he keeps coming back to is the erstwhile "jobs bank", in which laid-off auto workers were paid 95% of prior salary indefinitely to do nothing while waiting for next auto industry job. As a tenured faculty member, I don't usually get jealous of anyone else's non-salary perks or perverse incentives, but that is amazing that it lasted until recently.
One detail he keeps coming back to is the erstwhile "jobs bank", in which laid-off auto workers were paid 95% of prior salary indefinitely to do nothing while waiting for next auto industry job. As a tenured faculty member, I don't usually get jealous of anyone else's non-salary perks or perverse incentives, but that is amazing that it lasted until recently.
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