In reading your sentence of “core problem of inefficiency, poor performance, poor prouct quality, lack of new technology adoption/creation” as the issues facing the auto industry I have to agree with the technology aspect of it, but from a different angle.

The words innovation, client-centricity and arrogance come to mind as the real problems facing the U.S.A auto manufacturers.

Once GM, Chrysler and Ford made it to the top of the heap in the 1980’s, their arrogance led them to stop asking their clients and potential clients what they dream about in a car, decided to keep building massive gas-guzzling cars and have not invested in innovation in terms of lighter cars, smaller cars, none-gas powered cars, etc.

Only arrogance keeps a company from stopping to listen to their clients, leading to lack of innovation.

While new auto manufacturers emerged in the 1980’s, such as Hyundai, or established auto manufacturers have re-invented themselves in the past few years, such as PSA Peugeot Citroen, the U.S.A. auto manufacturers either kept their blinders on ignoring the fact that their competition is eating up their market-share in their own back yard, such as Nissan assembling cars in Ohio, or stopped fighting for global market share and just enjoyed the profits on the U.S.A. market.

Given the 10-year economic cycles that have been happening in the U.S.A. since the 1920’s, it was very short-sighted of management, R&D, sales and marketing executives to not realize that eventually clients will stop buying cars that are too big, too heavy, inefficient in terms of gas consumption and the lack of innovation of internal/external/motor design would eventually lead to a halt in profits, revenues or worse the U.S.A. auto manufacturer to become extinct.

This leads to a macro-economic and socioeconomic issue of flexibility of the U.S.A. manufacturing workforce. When was the last time a new auto company was born in the U.S.A.? Look at countries like India and the Czech Republic and you will see new companies popping up because they are hungry to improvements, are not arrogant and can put their ego’s on hold to say yes I want to hear from my clients and no I don’t know every thing.