Bloom: Obama Administration Blindsided By Independent GM Board
The Senior Counselor to the U.S. President for Manufacturing Policy; and Leader on the U.S. Presidential Task Force on the Auto Industry, Ron Bloom, was utterly clueless. He told Reuters that the Obama administration supposedly was just as flabbergasted by GM’s sudden reversal on the Opel deal as Angela Merkel and the rest of Germany was. That they supposedly were not consulted. And that this is just divvy, because it “underscores the independence of a new board put in place to safeguard the U.S. government’s investment in GM.” Isn’t Teflon wonderful?
Bloom was “completely surprised. Our anticipation was that it was going to be approved. But the board of directors is an independent board of men and women who take their own decision. They made their own decision and we’re not going to try to get them to change it. I guess we could have said something. We absolutely did not.”
Bloom admitted that the timing of the GM decision was politically “awkward.” It happened while Angela Merkel was in town. Nobody of the administration told her – now we know why: The Administration was oblivious. Left in the dark by an independent board that acted on its own.
“Our friends in Germany were upset and we were most assuredly not glad they were upset,” Bloom said. “We value this relationship hugely. We would not sneak up on you with this ever. But we got snuck up on with this. And that’s what happens when you have an independent board that makes up their own mind.”
“In a perfect world, I would have known about it in advance. But you can’t know about it in advance because it’s a decision that happens in the board room. So by definition, I couldn’t know.”
Bloom said that the independent GM board has received clearance to invest the company’s cash in overseas operations if the board thinks that the money would make the automaker a stronger global player. Your tax dollars at work.
Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.
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Actually, this is the most refreshing news I have seen on GM in years....perhaps, over a decade! At last, a board of directors that is something other than a gathering of eunichs. I don't think I'm quite ready to jump on an IPO but this is good. Of equally good news is the departure of Al de Molina from GMAC. I was somewhat wary of Carpenter's previous associations but the fact he wants to move GMAC away from mortgage operations and focus on automotive is great....how's he going to do it?
Couple of points: - there was no GM "decision" to hang on to Opel. The deal fell through because there wasn't enough public money on the table to induce the partners to take this turkey off GM's hands. A deal will go ahead if the Obama administration (a) coughs up the difference and, probably, (b) agrees to stay involved (through a continuing GM equity stake) so that the joint venture can keep a cash pipeline hooked into the US taxpayer artery. - Bloom's posturing regarding detatchment from GM's board is part of the administration's exit strategy from its unpopular nationalization of the auto industry. As part of this, Washington wants deniability regarding responsibility for the inevitable failures at GM and Chrysler. When things go wrong, it had damn well better be somebody else's fault. That's why Fiat was given favorable terms to take Chrysler off Washington's hands. Similarly, the Germans are counting on Washington's need to cut and run. Team Obama will be forced to subsidize Opel to unload it, allowing the Germans to step back and keep their cash.