General Motors (GM) and Ford (F): Troubles at home

It's not a surprise to anyone that U.S. automakers continue to struggle against foreign competition as well as the propensity to drag their huge feet in quicksand. Yes, General Motors Corp. (NYSE: GM) and Ford Motor (NYSE: F) recently saw quarterly profits that surprised many of us, but in reality, none of that should have been a surprise once you break down the sales that led to those quarters.

If we're searching for profits in the domestic auto market, they are not there. International sales, however, show very good strength for both automakers. Are the domestic blues for both companies due to the UAW and union pressures and concessions? I suspect that thought is shared by millions of Americans.

So here's a radical idea: if the U.S. automakers are completely hamstrung in their home market by union nightmares which leave them completely uncompetitive with foreign rivals, how about exiting the U.S. market completely?

Okay, that idea is a bit of a stretch, but if I am an executive looking to maximize both sales and profit on an international scale, and one division constantly drags down those results, it goes bye-bye. It's not nearly that easy in the U.S. (far from it), and since the U.S. is the largest market for almost every global automaker (if not all), nobody can turn tail and just run -- even when profits are more elusive than the Loch Ness monster.

What to do, GM and Ford? One of the greater failings is the inability to convince customers to buy more American cars by citing them as just as (or more) reliable than foreign automobiles. While I'm not sure this was true just 10 years ago, it is most likely that way now. Toyota, however, continues to take home more and more sales (and profit) based partially on what I expect is pure consumer word-of-mouth more than anything JD Power can offer. Ever ask a Toyota Camry owner about the reliability of their car? Set aside about a half-hour. How about a Pontiac Grand Am (from a few years back)? Not so long, eh?

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