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This week marked an inflection point for social media. The uprising in Iran over their recent election was organized and communicated primarily through Twitter. While the government was able to control and censor traditional media such as television and radio, they were unable to stop the Iranian people from Twittering their protests across the globe.
It was an extraordinary media shift to watch journalists on television reporting events and information they could only access through Twitter. While the journalists in the country were isolated in their hotel rooms, their counterparts in the newsroom were glued to their computer screens getting all of the information for their reporting through social media.
This does not mean that television is dead or that print is obsolete, but it does mean that social media has grown from its roots as a networking tool for teenagers to a mainstream medium.
How fitting that a revolt in a traditional Islamic country becomes a metaphor for a changing of the guard in the world of media.
All the news lately has focused on GM’s bailout and bankruptcy. Let’s spend a few minutes to contemplate the second weak sister of the auto business, Chrysler. Their assets were literally handed over to Fiat and the company is preparing to drag itself out of bankruptcy with a similar deal to GM’s — lower labor costs and funding from the Canadian and American governments.
I won’t spend time analyzing why Chrysler ended up where it is today. Unlike GM, Chrysler’s past has been a series of takeovers and near-death experiences. When Lee Iacocca rescued the company from the brink in the early 1980’s, the recovery didn’t last long before the next crisis.
Let’s focus instead on Chrysler’s chances for survival which I would peg at slim to none. Why the pessimism? Let me list the reasons.
Fiat takeover - you know you’re in trouble when you turn to Fiat for help. This company has never been known for producing reliable automobiles. They have not sold cars in North America for decades and for good reason. Today, their products are designed and built for the European market. Their tiny cars are well suited to Europe but not for most American drivers and families. When you can buy a mid-sized car like the Accord or Camry that gets over 30 mpg on the highway, it’s hard to imagine people buying a micro-car like the Fiat Cinquecento (cute as it is). There may be a market in major urban centers but beyond that, I don’t see their current products appealing to the average American or Canadian driver. What’s more, Fiat didn’t put up a cent to acquire Chrysler’s assets so they have nothing at stake. Do you think they will hang in there when they continue to lose money? They can easily walk away without a financial loss or damage to their core business outside the U.S.
Dealer consolidation - I still haven’t heard a compelling reason for closing dealerships. These are independent retailers of Chrysler’s products and while they do require support, they also provide the core customer service experience that is so important in gaining and retaining customers. Chrysler is cutting so many dealers that they are hurting their ability to sell cars in the future.
Take my community for example. There are 100,000 people in the county where I live. We have dealerships for Toyota, Honda, Ford, Chevrolet, Volkswagen, Audi, Subaru, Volvo, Hyundai and Nissan. Chrysler just cut off their one and only dealer in our community, a family-owned dealership operating since 1915. The nearest Chrysler dealer is now 30 minutes away. What chance do you think they have to sell cars here in the future?
Product lineup - Chrysler’s vehicles have never been known for their reliability but give them good marks for stylish design. The problem is that gas prices and changing customer tastes have hurt their most popular models — Jeep, Ram trucks and mini-vans. There’s nothing exciting in their product pipeline that will revitalize sales in time to save the company. Lee Iacocca had the K-car which was the company’s salvation. Today’s Chrysler hasn’t got the products to turn sales around. Specifically, they lack a strong mid-sized sedan, compact car and cross-over vehicle. They remain strong in mini-vans and SUV’s but the public’s appetite for these vehicles has waned.
During Chrysler’s comeback in the 1980’s, Iacocca appeared in television commercials and delivered the line, “If you can find a better car, buy it.” Unfortunately for Chrysler, American consumers took his advice.
