By on July 10, 2009

TTAC’s Lutzies are safe. When Bob Lutz announced his retirement from GM at the end of this year, automotive journalists openly wept at the prospect of losing an never-ending supply of quotes and sound bites. But now we can rejoice. He’s back. Automotive News reports that Maximum Bob has decided to “extend his career as vice chairman in charge of all ‘creative elements of products and customer relationships.’” What that means isn’t exactly clear but he’s supposed to work with design chief Ed Welburn “to guide all creative aspects of design.” The chiefs of all of GM’s brands, plus all corporate mouthpieces will report to Lutz, who in turn will report directly to CEO-for-now Fritz Henderson.

Henderson was effuse in his praise of Lutz, stating “He has a proven track record of unleashing creativity in the design and development of GM cars and trucks. This new role allows him to take that passion a step further, applying it to other parts of GM that connect directly with customers.”

What no one is saying: why Lutz had the sudden change of heart re: retirement. The ex-Car Czar had previously stated that he’d stay if he was asked. Apparently Lutz’s reinstatement was at his own request. Anyone want to bet the change of heart was because he suddenly discovered his golden parachute retirement fund had been relegated to that scrap heap they’re calling “Bad GM?” Lest we forget: the man has a few hungry jets to feed.

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56 Comments on “Bob Lutz Un-Retires to Join “New GM”...”


  • avatar
    dswilly

    Didn’t he forget to drop the landing gear on his jet a while back and landed it on it’s belly? maybe he needs a new jet

  • avatar
    N85523

    I’m sure the fanboys over at the Fastlane blog will rejoice. When he opined about his retirement, the inconsolable wailing on the comments section was disgusting. I didn’t know he had that many loyal followers.

  • avatar

    Parachute aside, didn’t Lutz also cash in his stock options over the past few years in preparation for his retirement and GM’s bankruptcy?

    People need to get wise to why the big dogs do what they do. And stop giving them ridiculous amounts of respect.

  • avatar
    TexN

    I’ll echo Sajeev’s sentiment on this one. It is all about self interest driven primarily by greed and ego.

  • avatar
    Quentin

    Over on another blog, someone was talking about how amazing of a job Bob did with the GTO, Solstice, Sky, G8, Malibu, Camaro, Astra, 2010 SRX, 2010 etc etc. The cars themselves may not be bad. The problem is that GM is supposed to be in the business of making cars for profit. As far as I can tell, GM is potentially making money on only 2 of the first 7 listed (Malibu & Camaro.. maybe). I’d have to say that Bob’s gut feeling of product developement has left GM with a bunch of niche models that simply don’t sell.

    Oh well, Bob being back is just another reason I can wholeheartedly dislike New GM.

  • avatar
    AKM

    Sajeev: +2. Let’s face, it’s all about money, power, and ego.

    Now, is it just me, or doesn’t anybody have any idea of what to do with “bad GM”, and with Lutz, for that matter?

  • avatar
    grog

    Lutz is a putz.

    Catchy. Spread it around sufficiently and it might catch on.

    He’d still keep his new/old job tho.

  • avatar
    akear

    People bought more Roger Smith cars than anything Lutz produced at GM. What is the point of producing decent cars that few buy. Was it his idea to bring over the hapless Astra, which is probably responsible for putting Saturn out of business.

  • avatar
    hriehl1

    Most of history’s greatest (business and political) leaders had massive egos… it goes with the territory.

    Big egos are not always accompanied by leadership success… but leadership success is almost always accompanied by a big ego. That’s what it takes to say the emporer is naked and to buck all the toadies who exist only to get-along-and-go-along without affecting real change.

    Ask yourself this… does the new GM have a better chance with Fritz or Bob at the helm?… I’ll take Bob. GM’s product resurgence of late is largely due to his influence.

    Drastic times call for a willingness to take drastic measures… and Lutz, maverick that he is, won’t back down from action.

  • avatar
    Mr. Sparky

    Oh boy! Lutzie is back! He’s second in command… Does that mean he’ll be the next CEO when they pull the plug on Fritz?

    I certainly hope Maximum Bob finds himself at the top of new GM. At least then, I’ll get some entertainment for my tax dollars. Watching Maximum Bob in charge would be worth every penny!

    Long live the Lutzies! Long live Maximum Bob!

  • avatar
    Geo. Levecque

    GM here in Canada is flogging lots of large SUV’s and Trucks at large discounts and making lots of new Camaro’s in Oshawa, Ontario asking the workers there for overtime, to me this is not the new GM but very much like the old one!

  • avatar
    jpcavanaugh

    I continue to be the contrarian here. Lutz was the only guy anywhere near the top of that company that was not a career-long product of the GM culture. True, some of his cars have not been breakout hits, but there is no denying that GM is building much better vehicles than it was before he arrived.

    Until this morning, I still saw no chance of culture change in GM. Sure, some new board members, but NOBODY with any operational experience who is not a GM lifer. Now, there is at least SOMEBODY in management that knows how to build cars and cares about how its done. With some more authority, who knows. At least it is a chance.

  • avatar
    PeteMoran

    Maybe his third wife didn’t want him hanging around at home…..

  • avatar
    TexN

    jpcavanaugh,
    Good points in your reply, but i noticed that there is no mention of the word “profit”. I will keep beating this drum because in the end it is the only thing that matters. I don’t care if GM sells horses and buggies if they can make a profit while doing it.
    Tex

  • avatar

    Though Lutz has had more misses than hits, I see this as a positive sign. Not because he’ll do great things back at GM. But because he thought it was worth going back to. He must think working for the new GM will be exciting, and will put a nice finish on his career.

    I don’t think this is about money–he has plenty of that.

  • avatar
    86er

    Geo Levesque:

    Maybe GM’s problem is they don’t know what to keep in stock.

    Here in Western Canada there’s shortages of trucks at the dealerships while in Montreal they’re trying to unload their stock at deep discounts? Makes no sense.

  • avatar
    rmwill

    jpcavanaugh:

    +1 Insightful. Seems most of the Lutz haters are still upset about his frank talk, like Global Warming is a crock o shit.

    Between the PTFOA, Finance dunderheads like Henderson and washed up Telecom and Airline execs, Lutz is a star.

  • avatar
    Pch101

    there is no denying that GM is building much better vehicles than it was before he arrived.

    Better than before, yes. But still not good enough.

    Lutz is an OK tactician, but a terrible strategist. The product decisions reflect a lack of understanding of what the brands are supposed to be or how they can be rebuilt. Meanwhile, the execution has typically been less than 100%, which perpetuates the “perception gap”, which is actually a reality gap — most consumers know better than to buy a GM vehicle, and most of those who do buy one expect a low price or discounted financing to lure them in.

    I take this whole thing as a bad sign that Renault won’t be coming to the rescue, and that the existing management might stay. None of that bodes well for the Not-So-New GM.

  • avatar
    johnthacker

    Better than before, yes. But still not good enough.

    Better vehicles isn’t enough if GM can’t make a profit on them. If the marginal cost to GM to make a better car doesn’t allow them to increase sales or increase the price enough to justify it, it doesn’t help.

    Yeah, it’s a vicious cycle, as years of skimping has meant that people who care about subtle quality don’t look for GM, so building cars that have that isn’t worth it. It takes years to (re)build a reputation.

    GM has high labor costs without the high productivity that would justify that. Hypothetically cutting some fixed costs and jobs would allow GM to be profitable while producing a smaller number of more expensive cars, which is one way to make a profit with high costs. I don’t think that New GM is going to get there, though, nor politically is it likely to be palatable to focus on high margin vehicles.

  • avatar

    Lutz’s frank talk isn’t the problem. The problem, as Pch101 notes, is that Lutz’s product strategy and sense of branding leave a lot to be desired. These together with a lack of attention to profitability are typical weaknesses of “car guys,” and explains why they aren’t running the show.

  • avatar
    Pch101

    Better vehicles isn’t enough if GM can’t make a profit on them. If the marginal cost to GM to make a better car doesn’t allow them to increase sales or increase the price enough to justify it, it doesn’t help.

    It’s not rocket science. When brands are damaged or unknown, the successful strategy is proven and clear:

    -Build a few vehicles that people want, using those standouts to build the brand, while luring some customers in with the pricing.

    -As reputation grows, gradually raise prices and expand the lineup to pick up new categories.

    -In time, charge the market price and produce volumes around that price.

    That’s it, very simple. Losses are inevitable in the short run, and have to be accepted and planned for.

    GM needs a much smaller lineup so that there are only winners and no losers. The losers should be eliminated, even though that will inevitably lead to lower volume.

    GM does not need volume; the pursuit of volume for its own sake has been a major part of the problem. Instead, it needs to begin with crafting reputation, and then convert that reputation into profit. That process could require a few years to turn into breakeven, and a decade to turn into real profit.

  • avatar
    KixStart

    TexN: “I don’t care if GM sells horses and buggies if they can make a profit while doing it.”

    Well, there’s some potential there. The horses could manufacture themselves. Of course, at GM, you don’t know quite what would happen if they embarked on such a strategy.

    (phone rings)

    “Purchasing, Bob Smith, how can I help you?”

    “Hi, Bob, this is Ted James in Manufacturing Engineering, Horse and Buggy Division, Powerplant Section.”

    “Sure, Ted, how are you doing?”

    “Well, not so good… you bought some horses for us to use in the power plant reproduction process, right?”

    “Yes, we did. Saved a bundle, too, with just a minor change to the spec. Some of the horses you wanted are a lot cheaper than the others, so we ordered the whole lot that way. I may get a promotion out of that.”

    “Yes, well, Bob, that’s the problem. See, we wanted 2 male horses and 98 female horses for a reason.”

    “C’mon, Ted, a horse is a horse, of course, of course, I’m sure you engineering guys can make do with what you got. Call me any time. Gotta run, I’ve got a cost reduction celebration to plan. Bye.”

  • avatar
    rmwill

    Remaining true to the “brand” was not Lutz’s job, it was Mark LaNeve and his underlings like Susan Docherty.

    Docherty was the principal architect of the Hummer debacle. She is apparently going to be reporting to Lutz now.

    Lutz did a damn good job of getting the Car Guys to execute the brand plans of the marketing team that he will now lead.

    I am sure Lutz was not the genius that gave the Aura and Outlook to Saturn before they gave Chevy their versions. Also, what genius made the Malibu not available with a nav system ?

  • avatar
    EricTheOracle

    I just saw the photo: they’ve cloned Lutz! Can a barrel of Lutz be that far behind?

  • avatar
    TexN

    KixStart,
    It is obvious from your reply that you’ve spent some time “in the belly of the beast”. That is the funniest post I’ve read in some time! Well done!
    Tex

  • avatar
    Bunter1

    +1 to KixStart.

    Probably all geldings…love it.

    Just yesterday I was gripping that I missed El kaBob. The service at GM has improved!

    I hope Bob lives to be 120 and spends everyday in the auto industry “speaking his mind”. At least we’ll get a bit of entertainment.

    Of course this will not make one iota of difference in GM “next” failure, he had no effect on the last. But it will make it more fun to watch.

    Would love to see him replace Fritz at the top-what a hoot!

    Farts & giggles,

    Bunter

  • avatar
    loverofcars1969

    Time for some brutal honesty. What does GM make that (against the competition) really turns you on? To me the only car they have worth a damn is the G8 GT. If they had spent another $500 per car to get rid of the cheap ass radio and install decent switch gear they could have sold them all day. GM trucks (yawns), small car (still drowsy), and Cadillac even the acclaimed CTS is POS (engine is rough and after 6K miles it squeeks and rattles like a haunted house.

  • avatar
    Robert Schwartz

    Wow! New GM = Old GM + Bob Lutz

  • avatar
    quasimondo

    better him than wagoner.

    Was it his idea to bring over the hapless Astra, which is probably responsible for putting Saturn out of business.

    Saturn was long dead before the asrtra arrived. If the ion didn’t kill it, the l300 surely did. And if that wasn’t what killed Saturn it definitely was the lack of a better car for loyal customers to return to after they were ready to tradein their sl2.

  • avatar
    hriehl1

    To those clamoring for profit…. that’s not so important anymore. The rules have changed now that GM has 300 million new owners.

    As to upgrading switchgear and a radio in the G8 GT… that would take only about $75… parts just don’t cost that much… but it is the only place manufacturers can scrimp… all other costs are pretty much fixed.

  • avatar
    midelectric

    I don’t see the point of him coming back if he’s just going to campaign for more muscle cars and 2 seaters, that stuff is nearly irrelevant to a mainstream auto maker. If Lutz had focused team energies on making the G6 more than mediocre it might have meant Buick getting the axe instead of Pontiac. The point about him being a great tactician but a miserable strategist is really spot on, unfortunately GM is the way it is because there’s apparently no one who can think through strategy any better.

  • avatar

    same as it ever was…

  • avatar
    agenthex

    That process could require a few years to turn into breakeven, and a decade to turn into real profit.

    Time is exactly their enemy. The car biz has such long cycles and they’re bleeding cash.

    If anything, not bringing in entirely new management is a sign they’re capitulating to the fact that this is an unsolvable problem and it’s best to wind the whole thing down to a symbolic company in a few years.

  • avatar
    cleek

    Bob Lutz should be good for a few more laughs.

    “I stand by my earlier position Congressman Waxman. Green logo aside, it is still a crock of … .”

  • avatar
    rpol35

    Heeeeeeeeees back! RF will probably have a stroke.

  • avatar
    charly

    midelectric, Buick is a Chinese car brand and GM-US needs the Chinese market to survive. If Buick sold 1 car in America it would still not be cut.

  • avatar

    The American industry needs to build globally competitive products profitably in the US. Lutz has absolutely NO idea how to do that with 3,4 or 5 dollar fuel. He should continue to sniff his own JetA until he doesnt.

  • avatar
    KixStart

    bunter1: “geldings…”

    I laughed out loud when I read that. It’s the icing on the cake.

    Although the image in my head when I wrote that little play out was a group of very frustrated manufacturing engineers doing their darnedest to get 100 very nervous male horses to cooperate in “the manufacturing process.”

    rpol35: “Heeeeeeeeees back! RF will probably have a stroke.”

    Are you kidding? RF’s going to be thrilled. “It’s gold, Jerry! Gold!”

  • avatar
    levi

    Bob Lutz….Brett Favre.

    Same story….same results.

  • avatar
    King Bojack

    The HUGE difference that the LutZ haters are missing is that Lutz and GM no longer have 8 or so brands to dick with. Think about all the interesting crap Lutz got done, contract it into ONE brand and it’s gonna be one hell of a brand.

    They won’t be sending future Sky/Solstii type vehicles to Pontiac or Saturn, they can only go to Chevy.

    The Malibu won’t fight the Aura or G6/8s in any aspect since they won’t be around. Etc. etc. given Lutz’s ability to at least get a few interesting cars into show rooms in wayyyy too many brands he should be able to help GM get some slick ass cars into their few remaining brands.

    Basically, quit claming GM is fucked before the smoke has even cleared from the demolition. Might as well claim a surgery patient is screwed before they even get off the ops table.

  • avatar
    Pch101

    Think about all the interesting crap Lutz got done, contract it into ONE brand and it’s gonna be one hell of a brand.

    Except that there are four brands, not one.

    That, and Lutz seems to have one recipe for everything, based upon brawn and horsepower. In this day and age, brute force is not the be-all, end-all automotive solution that it once was. The guy is living in the past, and he doesn’t seem to understand how the market has changed.

    The Detroit Defenders don’t understand that the 60′s ended in 1969. Time to update the calendars, and to take a look around at what the competition is doing, today.

  • avatar
    King Bojack

    I didn’t say GM only had one brand. That was hypothetical, at any rate, only having one real volume brand will let Lutz’s product plans go to market with out most of the canabalism that damaged GM over the past 20 years or so.

    GM and Lutz HAVE looked at the calendars and what the comp is up to. Assuming Volt works they will have one of the most advanced vehicles on the road dedicated to the ideal life of daily travel using essentially zero gas. GM is also up there in fuel efficiency, engine power, and features in pretty much all their cars. Nice try saying new GM (or even old GM) was/is locked in the muscle car era.

    If you mean Lutz only has one recipe in styling, maybe true but it might be a safe assumption to say that GM styling under Lutz improved wildly.

  • avatar
    Pch101

    I didn’t say GM only had one brand. That was hypothetical, at any rate

    There’s no point in dealing with hypotheticals, when the reality indicates that Lutz has four brands to deal with.

    That complicates the issues in ways that you seem intent on sweeping under the rug. Where does the balance get struck amongst Chevy, Buick and Cadillac? How does the company accommodate three sales channels, when it hasn’t been effective with any one of them to date? The reality is a lot uglier than the hypothetical, and Buick is the sticking point.

    Assuming Volt works they will have one of the most advanced vehicles on the road dedicated to the ideal life of daily travel using essentially zero gas.

    Why would you assume that when GM can’t even build a compact on par with a Civic? What justifies your confidence that the Volt is going to beat the competition with an innovative product, when they haven’t even been able to match the competition in less complex, more common vehicle classes? And even if it could, what makes you think that they could sell large numbers of them at the suggested inflated price point?

    If Lutz couldn’t even make the Solstice better than the Miata, despite all his chatter to the contrary, then I have my doubts that he is going to out-Prius the Prius anytime soon. He’s not good enough to admit his flaws, and his blind sides contribute to the hubris and to the second-rate results.

    GM is also up there in fuel efficiency, engine power, and features in pretty much all their cars.

    That’s a classic apologist’s comment. Surely you must know that GM has been able to claim to have more fuel efficient vehicles because they’ve been including badge engineered duplicates in the count.

    If the goal is to simply promote GM lifers, I would prefer that they at least bring in managers from other markets. Fire the Americans, and replace them with Aussie, European, Latin American and Chinese managers who have done a better job in their home markets. Handing the leadership mantle to the inbred Detroit crowd is only going to lead to a repeat of the same mistakes that brought them to bankruptcy.

  • avatar
    rmwill

    pch101:

    Lets see:

    Prius good, horsepower bad.
    Inbred Europeans/Asians/Latins good, Americans Bad.

    Very insightful.

    More seriously:

    You think in a nation that is unwiling to pass on the true price of using oil as the dominant fuel stock will embrace small hybrids? Remember that GM have 50 billion dollars to pay back to the taxpayers. GM needs to build what will sell. Period. Even the PTFOA gets that now.

    That said, the Domestic makers need to increase fuel efficiency very quickly, but also need to maintain vehicle size, power and affordability, because at 2.25/gallon, consumers will not give up trucks and SUV’s.

    As for yor comment about non-Americans… I assumne that you know very little about the cultures of these mega corporations. If you did, you would realize that MBA-itis knows no nationality boundaries. In fact the Europeans are the worst.

    The real fix is to kill off not only the upper management (Fritz goes first) but also destroy the layers of Powerpoint and Excel jockies in middle management that are jealolusly territorial and change averse. I refer to them as the merry band of wrench throwers. Just ask the guys in the trenches. Their biggest obsticles are local middle management who are only about maintaining their tiny empires that justfy their meager 150K salaries and company vehicles. I know this firsthand. These are my “colleagues”.

    Until the middle purge occurs, nothing changes.

  • avatar
    KixStart

    King Bojack: “Assuming Volt works they will have one of the most advanced vehicles on the road dedicated to the ideal life of daily travel using essentially zero gas.”

    You’re assuming quite a lot. GM has two hybrids on the market at the present time. They are dismal failures. They’re horrendously expensive, the BAS provides hardly any advantage and the two-mode is put into “hybrid” vehicles that can still be described as “gas guzzlers.” The market has rewarded GM’s marketing savvy and egineering and manufacturing prowess with about 200 units/month/model in sales. Most of which, I strongly suspect, have been to fleets (of the 3 confirmed two-mode sighting I have, all three were fleet vehicles).

    Even “assuming Volt works,” it’s a $40K compact car that will compete with the Prius. Let’s see, $22K or $40K? Ummm… tough call? No.

    Yes, it will compete with the Prius, whether GM believes the Prius is the competition or not.

    Even “assuming Volt works,” what’s GM’s advantage in the Volt? Precisely Zilch. Everybody (except GM) is waiting for a capable and cost-effective battery. GM is going with a cost-prohibitive battery. There’s nothing in the Volt that isn’t in a Prius or a standard car, so there’s nothing stopping any other manufacturer from buiilding their own EV of some type.

    When the price of batteries comes down, every other major manufacturer can join the party. GM will have negigible share (by design – the intend to product just 10K vehicles in 2011) and no way to capitalize on their advanced and expensive development. They’ll simply pay interest on the underlying investment longer before they get to any kind of payoff.

    Also, the “advanced” nature of the Volt is open to question. It appears that it will have one electric drive motor and a differential. I can see how this arrangement would advance the delivery date and reduce development cost but I think it’s going to hurt overall vehicle performance. I would have expected a more advanced design with one motor per drive wheel, GM could have liberated itself from a power-sapping differential.

  • avatar
    Pch101

    Prius good, horsepower bad.

    Not quite. Cars that consumers like good, cars that they don’t want bad.

    The problem with competing for horsepower is that it is no longer unique. When your average 6-cylinder transplant family sedan has 250-300 hp out of the box, boasting about ponies provides little advantage and makes the Detroit ironmongers look stupid and out of touch.

    There is no competitive advantage to muscle anymore, because everyone has it. There isn’t much lust for it among the public because it’s easy enough to get, even in a minivan. Find something else to brag about, and fast.

    you would realize that MBA-itis knows no nationality boundaries.

    Blaming the MBAs is yet another copout. If you look at the senior management of the Old GM, we can see that about 40% of them came up through engineering. The first iteration of GM was almost destroyed by one engineer (Durant), until he was stopped by another engineer who didn’t behave like one (Sloan).

    It isn’t the degree, it’s the culture. At least the foreigners within GM are accustomed to working with limited resources and working outside of the main corporate political circle. Something needs to penetrate the Midwestern cult that led to the destruction of the business. A lot of people in Detroit will require pink slips to make this work, and many of them did not go to business school.

  • avatar
    rmwill

    pch101:

    Prius sales are way down. If you look at the data, they track very closely to three variables. 1) Fuel prices 2) Tax Credit/Incentive availability 3) New Model Release

    I expect to see a bump up in the next few months because of the new model, which is impressive. However, the sales will drop again if fuel remains cheap, and Toyota does not tape cash to the hood.

    Hybrids will remain niche vehicles in the US unless fuel prices rise dramatically.

    On the other issue: GM management is just as messed up across the globe. Unless you work there or are close to it, you are simply guessing. I am not guessing. Your coastal elitism is noted in your “midwestern” jab. I will stick to facts.

    GM, and also Ford, and Toyota, and GE, and the Cisco, and Microsoft… Really, any big business organization has a dramatic tendancy to build management structure and hierarchy. They bring in (or train themselves) managers that are rewarded for two things usually: How large their organization is, and how much they can cut of non personnel costs year over year. This has lead to the two most dramatic observed effects: Slow decision making and reduced product appeal.

    To get ahead in these organizations, Engineers have nearly always went away to Business School and brought back the beancounter mentality that their organization values. Those that do not follow this path almost always end up with limited careers.

    Every so often, leadership emerges that successfully breaks this pattern. Historical examples include Don Peterson at Ford, Iacocca at Chrysler, Gerstner at IBM, Jobs at Apple. Rarely there are examples of how to avoid these tendancies, Honda comes to mind. Although Honda may just be small enough to have avoided the deadly formula. However, these transformational leaders have never succeeded in bringing lasting change beyond their immediate terms of service. The underlying dynamics of big companies are always pushing the organization to bloat up and cheapen the product.

    Unless you have been truly inside one of these companies, you really are guessing.

    MBA’s kill car compaines. Engineers with MBA’s are still MBA’s. And I am an engineer with an MBA.

  • avatar

    @ rmwill: I want to amend your last point just slightly — MBAs kill companies, period.

    Lawyers get a bad rap, but the MBA mentality has done far more harm to American business (and America in general) than lawyers ever could.

  • avatar
    King Bojack

    PCH:

    You’re the one that’s assumed little to nothing has changed.

    They haven’t been able to decently run any of their brands in decades because THEY HAD TOO MANY which is not a problem. Now instead of Chevy/Saturn/Buick/Caddy/Hummer/Saab/Pontiace/GMC and any foreign brands you might want to throw in there getting maybe 15% or less of GMs overall attentnion and marketing and R&D budget they get 25% or more as situations dictate.

    Perhaps 4 brands will still be too many but we need time to figure out if that’s the case or not.

    I assume Volt will work because it’s pointless to be an anti cheer leader crowing about how it will fail. Besides, every one acts like the Volt’s intent is to sell shitloads at a high margin etc. etc. instead of realizing it’s more of a low volume tech showcase. People ejaculate with delight over how awesome Toyota was to take a chance with the Prius (mind you Toyota hasn’t really risked anything, ever) but when GM decides to do something even riskier that the Prius it’s an auto fail? Totally pointless and counter productive to be against the Volt’s success. If the Volt works as intended many thousans of people will never really need to buy gas… ever.

    The Solstice GXP and Sky Redline effectively rape the Miata, pretty sure they even beat the Miata speed edition. Lutz and crew also threw together a decent Miata competitor in like a year and a half if memory serves (makes one wonder the Camaro took so long). Then they put it up against a car that’s been around for 20 years? I sure as hell hope the Miata turned out to be marginally superior. Is Hyundai retarded since the Genesis coupe doesn’t murder the Mustang/’Maro/370?

    I also don’t look at the number of fuel efficient vehicles, I just see a Cobalt platform that in the XFE model gets Corolla/Civic fuel economy numbers, the Malibu gets excellent EPA estimates, so does the Silverado XFE, the new Equinox is supposed to do the same, the Traverse has as good or better mileage than damn near anything else that holds 7~8 people. Shit, just look at the Cobalt, GM even offers the ability to get a Cobalt that either gets really good mileage or one that hauls tons of ass, whether you like them or not only Mazda3 and some Euro brands really do the same. None of them equal the EPA estimates in the Cobalt XFE while doing it. It’s easy as pie to zero in on the DTS and Aveo type half assed cars that GM has cranked out lately but it’s much more fun to look at all the good they’re doing.

    The general idea behind the bankruptcy is to shed all the crap that made old GM shit and do what the Mr. Farago types have been crowing about for years. We won’t know till a year or two worth of sales figures, fiscal statements etc. to know whether or not it worked.

  • avatar
    Pch101

    Perhaps 4 brands will still be too many but we need time to figure out if that’s the case or not.

    If there are any examples of a near-luxury brand succeeding in the North American market in the last couple of decades, I’d like to hear about them. Until then, I would assume that it won’t work, because there is no reason to believe that it will work when there are no precedents for it working.

    I assume Volt will work because it’s pointless to be an anti cheer leader crowing about how it will fail.

    In other words, you can’t handle the truth, so you choose to reject it.

    General Motors has done a rotten job of being innovative. I have to assume that with the current management in place that it just isn’t good at innovation. Since the Volt purports to be an innovative product, the most logical response would be to assume that the status quo will continue.

    The Detroit Defender defensiveness is at the root of the problem. Instead of acknowledging mistakes, they like to avoid responsibility and blame the customer for making different choices.

    The situation simply cannot improve until those within the company assume full responsibility for problems and the obligation to fix them. Without a cultural shift, I see no reason for that to happen, and I put low odds on that cultural change being ignited by a Detroit lifer. I will be delighted if they prove me wrong, but I have no reason to believe that they will prove me wrong.

    The general idea behind the bankruptcy is to shed all the crap that made old GM shit and do what the Mr. Farago types have been crowing about for years.

    Right. And even though they have a better balance sheet, they don’t have better people running the joint, which was always the critical missing piece. If heads start to roll or a white knight such as Carlos Ghosn comes in to rescue them, then I’ll feel better, but until then, I will remain skeptical.

    Prius sales are way down.

    You obviously miss the point of the Prius, as well as the fact that even during an economic slump that it still hits better retail sales numbers than just about any passenger car that GM sells in North America.

    Toyota understands that having a variety of good vehicles at all price points is a key to success. Those who want a fuel-belching SUV can get one from the very same lot that sells the brand building, now-profitable green machine. The consumer has no need to switch corporate loyalties to get what he wants, as ToMoCo has a product that will suit most tastes.

    GM went from being a mainstream company to a one-trick pony. It is no longer a full-fledged automaker, but a niche manufacturer of pickup trucks.

    It’s not that some consumers don’t want cars or fuel efficient vehicles, but that consumers who want cars or fuel efficient vehicles don’t want them if they’re built by GM. GM should either downsize itself into a limited-function truck maker that sells only pickups and rental cars, or else it needs to get serious about making real cars that people want to buy. The engineers have done a rotten job of designing good cars, so I have little hope that salvation lies in their hands.

  • avatar
    King Bojack

    4 brands could work. There’s no reason executed half decently it won’t work. Caddy will probably move upstream and Buick will stay put. Chevy gets the volume market and GMC can be there for heavy duty Top Kick type vehicles as well as other medium to heavy duty semis. There’s very little brand overlap to be expected in the future. Near luxury brands used to be quite successful for the domestics until Caddy became near luxury themselves.

    Who says I don’t acknowledge domestic mistakes? Excellent straw man there Mr. PCH.

    Off the top of my head… domestics mistakes,

    Bob Eaton as CEO Chrysler, terrible fuck up.
    Saturn, bad idea because Saturn should have been a revolution of Chevy or something.
    Canning Olds but not Buick alongside it? Probably a bad idea.
    Canning Plymouth, probably equally as bad.

    The 3rd Gen Taurus, awful design, not putting any effort into the 4th gen and decontenting, horrible.

    Claiming the Aveo is good enough, not offering rear disc brakes and other simple amenities, bad idea.

    Most of the 80′s were terrible for GM et al. Ford cancelling the 91-96 Escort GT in lieu of the ZX2 Sport but decontenting vs. a ~5 year old design, awful idea. Ford half assing their v6s for years as well as taking forever to correct the Mustang interior. Chrysler for doing anything with the Germans when they didn’t to my knowledge need to at all, one of business history’s biggest fuck ups.

    See, I can neuterally look at the awful crap the domestics have done and see the good they’ve done. I can also do the same for the imports.

    Many people also put far too much emphasis on corporate culture and its signicance in business success. There are many examples of companies with ass culture doing well as well the other way around.

    In other words, you can’t handle the truth, so you choose to reject it.

    What exactly is the truth of the Volt that I cannot handle? Whatever Mr. Farago et all tell you to think Mr. PCH? Also tell me where I said the Volt was a guaranteed success or that GM incurs no risk in doing it. Unless you’ve got some excellent inside knowledge the Volt will not do what GM intends it to do you’ve no reason to assume it will fail. Seriously tell me why it’s productive to hate on it?

    GM has excellent engineers. Given the resources any engineering team could make pretty much do anything they wanted to. A huge percentage of design rests in the hands of marketing and accounting etc. This is proven by the Corvette and the trucks as well as anything else GM has been serious about. Please limit your hate to management.

    Toyota understands that having a variety of good vehicles at all price points

    I want a rwd drive coupe that isn’t a Lexus. What does Toyota have for me? I want a compact truck, what does Toyo have for me? I want a small, light weight, affordable rear engined roadster, what does Toyo have for me? I want a Yaris with rear disc brakes, what does Toyo have for me? I want a turbo hot hatch, what do they have for me? I want a Supra, what does Toyota have for me?

    See Toyota has significant product planning short comings. At this rate the Koreans will have more to offer then Toyota. So don’t act like Toyota has something to offer every one. They might have 20 years ago but not now.

  • avatar
    KixStart

    King Bojack: “I want a rwd drive coupe that isn’t a Lexus. What does Toyota have for me? I want a compact truck, what does Toyo have for me? I want a small, light weight, affordable rear engined roadster, what does Toyo have for me? I want a Yaris with rear disc brakes, what does Toyo have for me? I want a turbo hot hatch, what do they have for me? I want a Supra, what does Toyota have for me?”

    Absolutely, Toyota has holes in the lineup! Right there you have outlined dozens of lost sales per month!

    Look at your roadster… the market for those is probably under 4K/month, all manufacturers combined. Kappa sales are like 800/month. The Miata’s probably in the neighborhood of 1500/month. The market for two-seaters is very limited and more models isn’t going to expand the market. Is Toyota interested in spending a lot of money to develop a car that might sell at a 10K/year level?

    And nobody has a compact pickup. Maybe Mahindra or some other automaker, via Penske, is going to surprise a lot of people that think such a thing wouldn’t sell.

    As for the Volt… GM hopes to sell 200K by 2015. I’d have to guess that they’re spending $2 billion to develop it. How much is that per car in fixed costs, front-loaded so you’re incurring interest charges as you go? They’ve got to be selling them for $10K over the manufacturing cost by 2015 to even think about a profitable program. Does GM get those kinds of margins on anything?

    And, it’s a $40K compact car. Customers can either buy it or they can take their $40K down the block and pick up a Prius instead and have enough left over for a whole lot of very nice vacations.

    King Bojack: “GM has excellent engineers.”

    They do. Put them to work on something that might turn a profit.

    And nobody is going to care if the Aveo or the Yaris has rear disk brakes or not. The parts of the car that you actually live with have to be as nice as possible at that price point, it should get good fuel economy and the thing should move decently well when you step on the gas. If it holds together and is reliable, people will come back for another or maybe to trade up to something nicer.

    A buzzy stereo or cheesy-feeling interior is going to cost far more in sales at the under $15K level than drum brakes.

  • avatar
    King Bojack

    They’re still lost sales. I can go to the local Kia dealer and get a Rio hatch with rear disc brakes. I can go to a Ford dealer and get a rwd sports coupe. Ford sells the only pick up left that can be termed a compact. These are things Toyota is neglecting to compete in. Toyota is essentially lazy shits for this. They used to sell most of what I listed.

    2bil in dev costs spread out over 200 k units is 10k per car. Not that much considering the new tech involved. You can also skip the Prius as well and get a Matrix and squeeze in one or two more vacations if you want to talk upfront transaction cost.

    Hopefully post bankruptcy GM will be making things at a profit. We need more time instead of hemming and hawing about how they NEED and entire upper management flush to succeed.

    I care that Toyota and Honda and others won’t offer a simple 4 wheel disc brake set up for a subcompact. This is lazy shit design cost controlling and there’s no real justification for not giving us the option to get them. This is not the only sticking point just something I thought up. The fact that certain car companies COULD be giving us much nicer crap to buy but are coping out. It helps lend credence to my idea that Toyonda aren’t really good companies at their core and now they’ve got so much marketing on their side they’ll start selling 75% products because people who only care about “The parts of the car that you actually live with have to be as nice as possible at that price point, it should get good fuel economy and the thing should move decently well when you step on the gas. If it holds together and is reliable” will show up to mindlessly buy their slop.

    But to get back on topic, Lutz was arguably the best thing to happen to GM in recent years despite sales records or Mr. Farago et al’s opinion. No this isn’t just me regurgitating autoexremist.com either.

  • avatar
    agenthex

    I care that Toyota and Honda and others won’t offer a simple 4 wheel disc brake set up for a subcompact. This is lazy shit design cost controlling and there’s no real justification for not giving us the option to get them.

    Does this imply that rear discs are some kind of difficult new tech or something? It’s not exact hard to figure out the few dollars they save for pointless rear discs is smarter than the few dollars GM saves on interior quality.

    You’d do better to stick to the somewhat valid complaint that toyota has an image problem in the younger demographic. They’re slowly turning into the japanese buick, and Scion didn’t really help much.

    GM really is dead unless they can bring about drastic changes very soon. As is they can’t even admit to the sorry situation they’re in now, much less figure out a way out of it. I’ll repeat the hypothesis that the power that be have already run the numbers and figured it’s a hopeless case so the cash we’ve giving them is nothing more than a money cushion to fall on to their grave.

  • avatar
    KixStart

    King Bojack: “arguably”

    That’s one part you got right.

    King Bojack: “2bil in dev costs spread out over 200 k units is 10k per car. Not that much considering the new tech involved.”

    That’s before GM makes the first dime. And $10K over cost of goods sold per car? GM isn’t going to come close to that.

    King Bojack: “I care that Toyota and Honda and others won’t offer a simple 4 wheel disc brake set up for a subcompact. This is lazy shit design cost controlling and there’s no real justification for not giving us the option to get them.”

    Are you buying the aforementioned Kia Rio, then? No? Why not? It has 4-wheel disks.

    The people that do buy those cars don’t really care. They care that the car hangs together well, delivers good value and good fuel economy. They’ll appreciate it if the car is quiet and the interior is nice. These are value buyers. You might as well criticize Toyota for not giving the car a V8 engine.

    There isn’t any need for disks, either, as the Yaris is so light, you could practically open the door and drag your sneaker toe cap to stop the car. The fronts do most of the work, so value engineering puts disks in the front, where they are needed.

    Kia probably put disks on the car so that the salespeople could win a point against the Yaris and the Fit. “You know, they don’t have rear disk brakes.” Maybe they’ll get an extra sale from the feature.

  • avatar
    Pch101

    What exactly is the truth of the Volt that I cannot handle?

    That its odds of success are poor, given the track record and the fact that those who were architects of that track record are still employed by the company.

    You’re expecting the C- student to become valedictorian, without any evidence whatsoever to support your expectation. This explains a lot of what has contributed to GM’s failure — there is at best some vague expectation that things will get better, while little to no effort is made to create measurable improvements. Improvements don’t come from dumb luck, but from tangible efforts being made to fix what is broken, which is going to be tough if the leadership believes that there isn’t much that needs fixing.

    If there was a management shakeup, you might have a point, but there hasn’t been one. At least Fiat has made some moves in the right direction. So far, GM has given a lot of press conferences, but not much else.


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