Dramatic change needed for the automotive industry

I think that we can all agree that the US automotive industry needs a huge shake-up. The obvious points which commentators have tossed about in recent months include streamlining brand families, focusing more on quality, and reigning in union control and power. The idea of updating business models has also been tossed around.

Streamlining brand families should take the lead in changing the way that Ford, GM, and Chrysler do business. I am a marketing professional, and I'm disappointed in the snow job that the industry has done on large companies. Branding and marketing companies have made out like bandits, helping companies create subbrands and sub-subbrands to personalize the consumer experience. If everyone was in need of a custom car, the would have the resources to buy one of the customizeable luxury brands. The auto industry would benefit from being more tuned in to customer needs and preferences; however, it's not their job to create the ideal car for each person. A company would fail that way.

I propose that the auto makers shake up the mix by looking at the business model that companies like Nike and Coca-Cola use. Coca-Cola doesn't actually make the end consumer products -- the bottling companies do that. Coca-Cola is the organization that holds the patents on the formula and markets the product to build brand recognition and customer loyalty. The bottling companies are the ones responsible for getting the products out to the consumer. Nike is similar -- it markets and designs high-performance athletic gear. The gear is actually made by other companies, and distributed primarily through independent retailers.

The auto industry could explore turning over the production and manufacturing of automobiles to the workers. Perhaps the unions could rally their members together to buy out the manufacturing facilities, leaving them in more control of the products that they produce. In the meanwhile, the Big Three can focus on streamlining their brand families, designing superior-quality products, and marketing them to consumer and business markets worldwide.

By streamlining their brands and separating the production from the research and development, the auto industry can save itself. Without drastic changes to its business models and brand management, the federal loan money will be pissed away on a structure that's crumbling from the inside out.