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Outside auto show, a stalled state

Motor City pomp can't hide the decline of Michigan's carmakers and how it has hobbled the regional economy.

January 21, 2008|Ken Bensinger | Times Staff Writer

DETROIT — General Motors Corp. kicked off this year's North American International Auto Show with an opulent party in a giant heated tent alongside the Detroit River. Coming on last after several other acts, Michigan's own Kid Rock took the stage, singing as a pack of runway models escorted a Corvette ZR-1 muscle car down a catwalk.

"Let me tell you about Michigan," he shouted into the microphone to the crowd of reporters, politicians and society elites.

"We don't buy [expletive]. . . . We build it!"

What he didn't say, what no one here wanted to mention, was the obvious: Michigan is building less and less. And all the flashy festivities, paid celebrity photo ops and pomp ahead of the auto show's public opening Saturday could do little to obscure the grim, almost funereal, atmosphere of a city and state devastated by decades of relentless decline in the automobile industry.

The Big Three U.S. automakers -- GM, Ford Motor Co. and Chrysler -- last year produced 51.1% of the cars sold in the country, their lowest share in history. When GM releases its 2007 global sales numbers this month, it's expected to cede its title of the world's leading carmarker, a position it has held since 1931, to Toyota.

With the declines in market share, the companies have shed workers: Of the 400,000 jobs lost in Michigan since 2000, 70% of them were in manufacturing, giving the state the highest unemployment rate in the U.S.

Detroit, once a city of grand skyscrapers and comfortable middle-class neighborhoods, today ranks as the nation's poorest and most dangerous big city. Art Deco towers stand vacant, and many once-regal neighborhoods look as if they've been bombed, with street after street of homes abandoned, burned out and boarded up. By some counts, the Motor City is the area with the highest rate of home foreclosures in the country.

Like the heavy gray skies during the city's long, cold winter, the feeling of gloom is pervasive here, and Michiganders seem powerless to hide their feelings of desperation, remorse and nostalgia for the glory days.

"The people have the same mentality as the Big Three: denial," said Cesar Pena, a guitarist and freelance copy machine repairman who lives in Taylor, on the outskirts of Detroit. "Denial of change. Denial of what kind of cars to make. Denial of what kind of jobs to get. We're in a horrible rut and I don't see any way out of it."

Yet buried in all the anger is a resilient stubbornness, a distinctly local brand of conservatism, that says this is all temporary -- that says Detroit will someday, somehow, return to what it once was.

Two-term Mayor Kwame M. Kilpatrick, dressed in a flashy black fedora with a white snap brim for the GM party, said he refuses to give up. "We're fighting back," he said.

Visions of change

The city basked in the reopening of the Detroit Institute of Arts in November. Meanwhile, Kilpatrick has taken some extreme measures: To help balance the budget, he reduced the city's workforce by 25%; this fall, he proposed selling 92 of the city's parks to increase revenue. Recently, he proposed building a new convention center since Cobo Hall, where the auto show is held, is considered undersized and the automakers have threatened to move their show business out of the city.

His never-say-die attitude was adopted last week by Michigan native Mitt Romney, whose father once headed Detroit-based American Motors Corp. Romney pulled out a victory in the Republican presidential primary Tuesday on the force of television ads mourning a Michigan that once was "the pride of America" but now is in a "one-state recession." It was a surprisingly negative tone, but it resonated, thanks to Romney's pledges to make Detroit great once again.

"If I am president," Romney said in a speech to the Detroit Economic Club, "I will not rest until Michigan is back. Michigan can once again lead the world's automotive industry."

It was a promise that none of his chief rivals was willing to make. Campaigning in Pontiac, home to GM's primary truck plant, John McCain had a different message: "I've gotta look you in the eye and tell you that some of those jobs aren't coming back."

General Motors, the state's largest employer, made 3 out of every 5 cars sold in the U.S. in the 1960s; by 1980, that had slipped to 46% and last year to less than 24% for the first time since 1925. This week, GM economists predicted that total industry sales in North America would fall to 15.7 million units in 2008, down from 16.1 million last year, which was already the lowest number since 1998.

GM in the last year has displayed growing interest in producing hybrid vehicles and improving fuel efficiency in the face of soaring gasoline prices and changing consumer tastes. It's a strategy that worked for Toyota, which now has a profitable hit with the gasoline-electric hybrid Prius.

Pointing fingers

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