Advertising

Here is the essence of the automobile industry. Forget engines, forget powertrains, forget all that junk that you need an engineering degree to do. The essence of automotive innovation is advertising. Here is where an automobile is made.

"Now, in an attempt to once again create strong identities for its dozens of cars, trucks, and minivans, GM is moving to adopt the same brand-management techniques used to sell cornflakes and toothpaste."¹

 Pinnacle of GM Innovation

Since the market was reduced to a shared-monopoly in the 1930's, the automobile industry has halted competition in automotive technology. In a market which is a shared-monopoly, competition can be dangerous. A new powertrain technology, regardless of how minor, which does not pan out could degrade earnings significantly for years. Even worse would be an innovative powertrain technology - like, say, a fuel cell - which revolutionized the market. That could drive a "competitor" out of business. Losing one of only three domestic manufacturers could cause the fig leaf of competition to fall off.

If market power and advertising are put together (using that wonderful buzz-word of meretricious, anti-competitive miasma so favored now by Megacorp, Inc.) synergistically, really frightening things can happen. Really bad things - albeit now common place things - can happen to Constitutional "rights." God Bless the Wall Street Journal.

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^{1. Kathleen Kerwin, "GM Warms Up the Branding Iron," Business Week, September 23, 1996.4}