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November, 2012

  1. Lefter 58 ~ The Wrong Turn versus the Perfect Car

    November 19, 2012 by emweb

    I don’t necessarily believe in constant growth, economically. Is there any reason for a growth fixation other than pure profit?

    The current model means success is usually measured by percentage of year-on-year growth, as well as by financial returns. On the small scale, you’re not supposed to be focused on setting up a successful small business – you’re supposed to be fixated on the long term success via more branches, heightened recognition, potential franchising opportunities or the possibility of a hefty sale price for your brand once you reach a certain critical mass. Why isn’t it acceptable, or even desirable, to want to be really good at running your small business on one site? NZ has a huge number of small businesses, but these expectations add to the high number of small business and startup failures.

    While we celebrate, or at least discuss, sustainability, the economic fixation with growth is anything but. It leads to results like monopolies, slash and burn expenditure lowering, weakening of control and, eventually, collapse. The centre doesn’t hold.

    One area where economics and industrialisation coalesce and have done for over a century is the automobile industry. With manufacturing in general, we long ago departed from the axe analogy which goes like this: once upon a time, you bought an axe, and when you splintered the handle, you replaced it, and when the head broke or became impossible to sharpen, you replaced that. Ad infinitum. Perhaps you upgraded that axe haft to a better wood, or that head to better steel. And this is possibly still true, at least for a few axes, but if the axe maker has also since followed the pattern for most other goods, the handle is irreplaceable for some reason to do with materials and manufacture, or the head is attached by a proprietary device, or integral even, or you simply can’t find a replacement, or it can’t be added on outside the factory, or the cost of shipping an axe head to you is the same or more than just buying a new axe, since the composite parts are not stocked. So most people these days do just buy a new axe, since even if it is possible to replace the shaft and/or head.

    Back on that original axe model: 100 years ago, a good axe (a bad axe being highly undesirable, not to mention dangerous) was a major expense. Part of that cost, if you like, can be predicated towards the longevity of that product through the possibility of continuous and sustained replacement.

    Now we just buy cheap stuff.

    With cars, in Japan the government had a policy of no warrant of fitness for seven years. You blithely drove your new car for seven years. Then the test was so unbelievably strict, most cars failed even on cosmetic damage like scratches, so most got rid of the car and bought a new one. This was done expressly so Japanese people bought new Japanese cars every seven years, as a terrific boost to the local industry and a considerable barrier against entering the car market in the first place.

    Ironically, as a consequence, the canny Japanese manufacturers built their cars to last about that long – why engineer cars to last longer when they are just going to be crushed? Trouble is, New Zealand started rescuing these vehicles from the Japanese crushers and importing them as ‘used imports’. A seven-year-old Japanese car that’s been sold in the Japanese home market is rubbish. But that’s another story. (But with so many on our roads, I do think there’s at least some merit to keeping NZ’s strict every-six-months WoF regime.)

    By the way, a Japanese car designed for sale, new, in New Zealand is an excellent car with much longer life and all round reliability built in than a seven year span. That’s why the phrase ‘NZ new’ – even on a used vehicle – fetches a higher price. It really does mean a better car.

    Thing is, cars are just consumables now. A car manufacturer wants you to love their brand, and replace your car with another from their brand. Some car companies do have loyal customers, so this does work to some extent. That’s also why individual models evolve, becoming bigger and more luxurious, as both expectations and (hopefully) bank accounts expand. Compare a 20-year-old and ten-year-old Corolla or Civic with the current models and you’ll see what I mean.

    For New Zealand, by the way, the two largest groups of new car buyers are fleet followed by retirees. It’s hardly a massive market.

    But why do we have cars like these? Apart from the oil and petrol they burn and the heating and pollution they add to the atmosphere, a short-life car is full of hard-to-recycle and replace parts that all ends up as very highly developed, manufactured, assembled, maintained, marketed and delivered across the seas … land fill.

    This is absolutely crazy.

    Somewhere along the line, when manufacturing first became a big factor in the world, we diverged. At first, industrialisation’s promise was to deliver good products mass manufactured for economy of scale, delivering uniformly good products at an achievable price to a new range of consumers. For a while, industrialisation delivered on that promise.

    This was revolutionary, but what has tit become? Now a car is essentially manufactured as a revenue gathering commodity on an ever shorter journey to landfill, with various people clipping the ticket on the journey.

    Cars did not need to become like this, but it’s partly because of that growth fixation. The Ford Model T, for example, was seen as a starting point when it left a Ford factory. Even Henry Ford declared it so.

    My mother used to say “Why aren’t cars made of bouncy rubber? They’d be safer to travel in and would hardly be damaged in scrapes and collisions.”

    She had a point. But that would put panelbeaters, third-party manufacturers and parts suppliers out of work. But so what? Because … why hasn’t a car manufacturer developed an extremely sturdy, mass-manufacturable chassis that can be adapted endlessly? Axles go on, wheels, drive-train, transmission, one of four body shapes, and includes some kind of economical standard engine.

    ‘Bolted in’ are be the operative words. Although I don’t think standard bolts, I think some sort of special, super strong bolts that need a certain tool to undo, but that can’t come undone by themselves. You buy the bog standard car and you get the tool with it. The car is warrantable straight out of the factory in any country it’s sold.

    From then on, buyers can buy better or different bits and change them themselves. Want to swap the carburettor for fuel injection? Bolt off, bolt on, fire it up. Axles? Wheels? Body panels? No problem.

    Don’t trust yourself? Go to a mechanic.

    As this all fosters, rather than displaces, third party specialists and bespoke parts makers. Even body makers. Also, your entry into your first new car would have a much lower price point, but you could end up years down the track with the original chassis, but having evolved it through three distinct body styles and many other modifications. You could go to four-wheel-drive, a hybrid or diesel engine, automatic transmission, more power, leather seats, tinted windows … all easily, rather than at great expense.

    To me, this makes absolute and perfect sense.

    Yet it’s the polar opposite of what we have.