6/1/2007 | 3 MINUTE READ

Dudder: Diet Drinks, Apple, and George Romney

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It isn’t a Jeopardy category, but rather a prescription to fix what ails Detroit.


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Two things, seemingly unrelated, have broad implications for the future health of the domestic auto industry. First, is a study conducted to determine why diet soft drinks taste worse than non-diet drinks. It’s a problem that has stumped scientists given that the sweetening “power” of artificial sweeteners is equal to or greater than the high-fructose corn syrup found in non-diet drinks. They discovered that the way in which the diet drink reacted with the receptors in the mouth—its ability to provide the proper, or expected, feel and volume—made a dramatic difference in the perception of taste. Or, as one researcher put it: “If you bite into an apple and it doesn’t crunch, it affects the perception of the way the apple tastes.” Second, a report on luxury brands placed high emphasis on product design and the buying experience, and stated that Apple (computers and iPods, not fruit) is perceived as a luxury brand based on the look, feel, and operation of its products (especially the iPod) and company stores.

Actually there are three items. Years ago, I had the opportunity to interview former AMC CEO and Michigan governor George Romney about his time in the auto industry. It was a long, broad conversation, and one in which he explained why he didn’t go through with his former boss’s plans to unite Nash, Hudson, Studebaker, and Packard into a conglomerate that would—in theory—turn the Big Three into the Big Four. Romney was leery of the idea because it would take a massive amount of effort to recreate the corporate culture, align the products, and assimilate the various manufacturing operations into a unified whole. As one who understood the human capital necessary to make things work, he knew there was more to this process than checking boxes or adding and subtracting the numbers in columns on a spreadsheet to see what something was “worth.” Instead, he decided to keep American Motors—it was created out of the union of Nash and Hudson by George Mason, his immediate predecessor in the corner office—separate and introduce the Rambler.

How do these three items come together? Simple, the Rambler, as originally conceived, was a small car that had big car features or, as Romney put it, a vehicle that let the buyer of a smaller, more efficient have the luxury of a Cadillac without having the expense of driving what he later termed “a gas-guzzling dinosaur.” It was a “luxury” item available to mainstream buyers and sold by a non-luxury brand. Romney saw this aspirational aspect as central to his plans to keep AMC alive and thriving, and commented that—had he stayed at the helm of the company—he would have “expanded the Rambler idea to encompass the entire lineup” of American Motors. In addition, he would not have followed the Big Three in lockstep as it produced larger and faster cars, but would have worked to increase the efficiency of AMC’s products and provided an alternative to the “same book different cover” offerings of the competition. It’s impossible to say whether this would have staved off the inevitable dissolution of AMC as a separate automaker—the company was desperately short of development money—but it is interesting to ponder nonetheless.

After all, today’s domestic makers are seen as irrelevant sellers of crappy, inefficient, overly large vehicles that don’t measure up. If they were apples (the fruit), customers would be inclined to say they didn’t have much crunch. However, if they were Apples (computers, iPods, etc.)…or modern-day Ramblers…one could make a case that they were crunchy, full-bodied, tasty, and healthy.

Taking these items together paints a picture of domestic automakers selling crisp, clean, friendly—even playful—vehicles with a high value quotient, and a decidedly American style. Future programs would target powertrain efficiency—there is plenty of room to work here with technologies like turbocharging and direct injection, roller bearing crankshafts, increased combustion efficiency, and modern gearbox designs—higher standard equipment levels with fewer model and option variations for increased production efficiency, and a rationalized volume vehicle structure with an increase in unique medium- to low-volume vehicles created from the restructured volume parts bin. Heck, who’s to say the drivetrain of a small sport coupe and sedan—a turbocharged direct-injected inline four or optional V6 mated to a paddle-shift twin-clutch gearbox—wouldn’t drive the rear wheels? Now that would be an evocative, uniquely American take on the market—and maybe just what the domestic automakers need to break out of the clutter. 

Hand holding a crystal ball

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