Between The Lines: A Look Into Bob Lutz' Mind
Published: January 24th, 2008 Share
GM Car Czar Bob Lutz wants you to know what's on his mind. So, at last night's Automotive News congressional confab, Maximum Bob let rip, revealing the concerns triggering the suit's septuagenarian synapses. But, as usual, there are major gaps between Bob's thoughts and actual reality. Back in '03, I predicted that the automotive industry was on the cusp of a New Golden Age…To my credit, I didn't say exactly when this was going to happen… I would argue that the industry is in much better shape than it was five years ago, and that General Motors is in a lot better shape too. News flash: The Big 2.8 are all losing money. GM has just lost its title as the world's largest automaker (if you discount cars made under a minority partnership agreement with China's SAIC and Wuling). To my simplistic mind, "better shape" doesn't mean closing factories, buying-out workers and losing market share in your home territory. But Bob's not worried.I don't think about [global leadership]. And the answer would be the same whether today's numbers said General Motors is Number One, or Number Two…or tied!So why all the press releases proclaiming GM's still number one– by a mere 3k sales? Oh that's right: Maximum Bob doesn't think about it.The bottom line is, we are running the business in the best interest of the customers, employees and shareholders.Tell that to the laid-off employees and the remaining GM workers with reduced pay and benefits, because their employer can't make enough money to afford them. But hey, never mind, the circus is in town. And Bob's busy thinking about the press' comments about the Detroit Auto Show."How can you possibly not find any buzz at an auto show that includes so many examples of the world's most advanced propulsion technology? Like… a "hydrogen-powered" Cadillac without an actual propulsion system? [c]onsumer behavior is difficult to change, and it when it does change, it takes time, and a darn good reason. I'm not so sure about about the first part of that assertion. GM and the others managed to change American car buyers' behavior pretty quickly in the ‘70's and ‘80's. But MB's right that consumers need a good reason to change. Only Bob thinks Americans will give up their trucks and SUVs only if gas prices rise sharply to levels near what they're paying in Europe.In other words, let's not focus our corporate resources on offering Americans a high-quality, well-engineered small car (at a profit) that might entice consumers to change. Let's legislate high fuel prices so consumers have to change– regardless of what we offer. And there I was thinking Lutz was against federal intervention in the free market. And speaking of boondoggles…[t]he best route to a significant near-term reduction in petroleum usage is E85… f all the flex-fuel vehicles that GM, Ford, and Chrysler have committed to have on the road by 2020… were to run on ethanol, we could displace 29 billion gallons of gasoline annually.Considering the cost of converting existing products to "flex fuel" (a couple of hundred bucks), considering that GM just bought a chunk of an ethanol company, considering the federal fuel economy credits given to cars that will never touch a drop of corn juice, Bob's enthusiasm for E85 is no surprise.But that doesn't make it right. E85 is an unsustainable con that will collapse under its own weight. While you can’t blame GM for playing the con, why do I think they actually believe that ethanol is the answer?Electrically driven vehicles powered by lithium ion batteries represent the… future of the… industry. A year ago, everyone was saying, "What's GM doing with this car that's allegedly going to run on lithium ion batteries, which we all know won't work in a car?"We're still asking what GM's doing with the Volt. Despite all their promises, they've yet to come up with a viable battery for the electric – gas hybrid. This and other advancements may be years away, in reality, but we're going to be ready, because we're developing the vehicles [and] the electronic control technology… today. We are going to be ready, more ready than anyone else is going to be, when the battery technology is beyond what it is right now. A noble goal, indeed. But when tomorrow's batteries are ready, today's technology probably won't work with it any more than 1999's OnStar will work with today's digital cellular network. You're going to see, gradually but emphatically, the auto industry enter a whole new age. When this new age arrives, will GM be around to witness it? Either way, GM's future will be Bob Lutz' legacy.[The GM fastlane blog links to a pdf of Mr. Lutz' speech.]
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Published January 24th, 2008 1:36 PM
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