Do Car Manufacturers Have a Consumer’s Best Interest at Heart?

What a silly question? Of course they don’t. Non-business people usually believe that companies, especially big companies, know what they are doing and are paragons of efficiency. Those of us who have worked with big companies know this is hogwash. Large businesses can be incredibly short-sighted, inefficient and just plain stupid.

For instance, look at GM’s keyless entry remote transmitters for the decade from the mid-1990’s to the mid-2000s. As with other vehicle manufacturers prior to the advent of remote start, most GM trucks used a 3-button remote with lock, unlock and panic buttons and most cars had a 4-button remote with an added trunk or hatch button. SUVs used either the same 3-button remote as trucks or a 4-button remote with a different rear button (because it operates a lift gate rather than a trunk). Vans, of course, had more configurations to accommodate sliding doors. So, barring real technology differences or design changes for consumer taste (style), GM could have gotten by with maybe 10 different keyfobs. Instead, GM generated several dozen “distinct” keyless entry remotes during this period, with almost no fundamental technical improvement or cosmetic changes. By “distinct” I mean with different button configurations and/or non-interchangeable signal transmission. And, to make matters worth, GM then assigned three or four different part numbers to each unique remote transmission. So, if you look at a GM dealer’s part system, you would find maybe 100 keyless entry remotes where 10 would have easily sufficed.

Why did GM produce so many different keyless entry keyfobs? Well, mainly because there is little coordination between engineering teams on different makes and because the concepts of efficient component sourcing, streamlined logistics and low life-time maintenance costs are foreign to this industrial giant (and to nearly all of the other vehicle manufacturers as well). They certainly did not do it for the consumer’s benefit. There was almost zero evolution in GM keyfobs during this period from a consumer perspective. And because they used so many different systems with so many different remotes, what do you suppose is the effect? Well, production costs are higher, dealerships and aftermarket suppliers have to carry significantly more inventory and, for consumers, the cost of a replacement part is much higher than it would be otherwise.

It is no wonder that ever decade or two the automotive giants have to write off huge losses and either declare bankruptcy or narrowly avoid it. (And don’t think that the current high earnings mean that they will not be close to failure again in the near future . . . they will.) Thank you GM and thank you automotive world. My guess is that the only organization with poorer management of engineering programs and the supply chain is the Department of Defense.

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