American car companies used to be the pride of the automotive industry. GM was the undisputed leader or car sales and car manufacturing and Ford was a close second. Of course high end luxury and sports car had a market in America but for the most part, American car companies dominated the American automotive landscape. Eventually, foreign car makers started to chip away at the market share of American car companies in the United States. However, these foreign car companies’ market share was so small that American car companies did not even notice. American cars where always know for there extremely powerful engines and there huge steel frames. However, consumed by their own supremacy, the demand for automobiles began to shift.

Fast forward a couple of decades and suddenly, Toyota is not only the second largest car manufacturer in the United States, but for the first time ever, there is a serious chance that GM will no longer remain in the top spot. Additionally, both GM and Ford have suffered massive losses at the hands of foreign car companies. What went wrong? How did the American car companies lose control of the stranglehold that they had on the American auto market?

The first problem that American car manufacturers had was that they never did anything new and never really had a luxury line. For example, when GM designed a car body, they used that same car body for four or five different cars and simply put a different name on each car (for example, the Chevy Tahoe, the Chevy Suburban, the GMC Yukon, and the Cadillac Escalade are all the same car with different names). Put simply, consumers got bored. Another problem was that outside of Cadillac, there were no American luxury car brands. As such, foreign auto makers capitalized on this ever growing market.

Even though these problems existed, they were not fatal to the American car companies. Two big events occurred that has led to the rampant downfall of American car companies. First, American car companies started buying too many other car companies. Second, American car companies refused to embrace the hybrid and fuel alternative phenomenon.

American car companies would basically buy the company of any and all competitors. This strategy would have worked had the American car companies not completely revamped the car companies that they bought. For example, when Ford purchased Jaguar, Jaguar was a prestigious, European luxury car with a very distinct body and look. However, since Ford has taken hold of it, all of the new X-Types and S-types look like big Ford Tauruses. When I drive a Jaguar, I want it to look like a Jaguar and not a Ford Taurus. As such, consumers have been turned off from the brand and sales have suffered.

However, the biggest blunder that the American car companies made was ignoring the growing public concern over the environment and the exponential increase of interest in hybrid and fuel alternative cars. As such, American car companies literally lost billions of dollars to foreign competitors that not only embraced the technology but offered many models with the technology.

American car companies have finally embraced this change and are trying to play catch-up. However, it may be too little too late for the American car companies and they may have to settle on not being in the top two spots for American car sales for the time being.

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