Detroit loses importance for the auto industry after the bankruptcy

It couldn’t have been worse. Detroit had been languishing for decades, the residents fled this city; from unemployment, from crime, from omnipresent decay. “Motown” was long gone. But it actually went one step further – Detroit had to file for bankruptcy, causing the largest city bankruptcy in US history.

The city in the US state of Michigan owed its former world fame primarily to the automotive industry. Detroit was the car city par excellence, “Motor City”. It lived from the success of the so-called Big Three, the three major vehicle manufacturers based there, General Motors (GM), Chrysler and Ford. Ultimately, the pride of the metropolis became its undoing: When the corporations slid into the crisis, the bad ones began for the city too Years. “Detroit is a symbol of the decline of the American auto industry,” says Stefan Bratzel, head of the Center of Automotive Management in Bergisch Gladbach.

The big three became arrogant

According to the auto expert, this decline began as early as the 1980s. “At that time the US manufacturers still had a dominant position in the vehicle market,” says Bratzel, “but the Japanese brands were getting stronger and stronger.” But the Big Three did not take the competition – especially Toyota – seriously. Instead of expanding their product range, US corporations left the market for small cars and economical models to the Asians. Detroit remained loyal to the highly motorized fuel drinkers. “That was the first missed opportunity,” says Bratzel. As the years went by, it became a problem for Americans. With rising fuel prices at the gas station, their cars became less attractive, and the Japanese also caught up in terms of quality and reliability. The Big Three’s sales fell. The result: They shut down production facilities in Detroit, and suppliers also had to close. The financial crisis accelerated the trip to hell. Then in 2008 the bankruptcy declaration – GM and Chrysler had to beg for government aid.

The car companies have now recovered from the crash, albeit at the expense of savings and job cuts. So Detroit’s decline continued.

The city has lost its status as an exciting automotive metropolis for good: “Meanwhile, other regions in the USA stand for innovations and progress in vehicle construction,” says Bratzel, “for example California, where Tesla is currently successfully developing electric cars.” In his opinion, Detroit has missed the chance of a new beginning a second time.

Not a good place for a glamorous appearance

The past Detroit Auto Show provided evidence of this. At the exhibition, the manufacturers mainly presented new pick-up trucks, sports cars and SUVs – with large cubic capacities and high fuel consumption. You looked in vain for clever hybrid or e-mobiles. The Detroit Auto Show is one of the most important events on the industry’s trade fair calendar.

But even that could soon be over, says Stefan Bratzel. On the one hand, according to him, the importance of the vehicle fairs in Beijing and Shanghai is growing because China is a gold mine for manufacturers. And on the other hand, big car manufacturers now often forego major trade fair appearances and instead present their new models when it suits them – the best example of this is Mercedes with its new S-Class. The attention is certain to them anyway.

Auto expert Bratzel believes that Detroit will therefore be avoided by some manufacturers in the future: “Because who wants to present their new vehicle in a place that stands for the big bankruptcy?”

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