General Motors Death Watch 170: Executive Outlook Express

general motors death watch 170 executive outlook express

General Motors is about to report a massive sales decline for the month of March. GM’s management will acknowledge the loss, blame it on the general downturn in the U.S. new car market, point to a few successful models and move on. Later, the American automaker will report it’s burned over a billion dollars in the last financial quarter. GM’s management will blame the market downturn (again) and the strike at American Axle. The top brass will admit that GM’s turnaround is… delayed. But at no point will they accept responsibility for their plight. Well, why would they?

If I’ve said it once, I’ve said it 169 times: GM’s corporate culture lacks accountability. Despite the fact that the scoreboard clearly shows that the automaker is receiving a dramatic drubbing at the hands of any number of fitter, better and stronger competitors, no one at the top level is willing to step up to the plate. No one takes responsibility for missed opportunities (dozens of vehicles dying on the vine), flawed strategy (FOUR Lambda-based crossovers?) and blatant screw-ups (Fiatsco?). The company is populated by Teflon suits.

In this, of course, GM is not alone. You could make an excellent case that The General’s generals operate under the same CYA mandate that insulates our elected representatives from their failures and broken promises. You could also argue that GM suits suffer from the same misguided and inherently self-destructive sense of entitlement that characterizes America’s political pressure groups. I’m not saying our culture of blame is to blame for GM’s blame-free culture. But the automaker’s attitude reminds me of nothing so much as my local, all-powerful teacher’s union.

Like the Rhode Island Federation of Teachers and Health Professionals, GM’s upper management truly believes that everything they do is for the greater good. Their real mission: consolidate their power; protecting jobs is job one. Though both groups pay lip service to the “end user,” neither is willing to live or die by any qualitative metric. And both depend on PR and spin for their survival, without any real understanding that their actions– and inaction– create an unending stream of mediocrity.

For decades, industry analysts have blamed the United Auto Workers Union (UAW) for their employer’s lousy margins and poor product quality. (Read Arthur Hailey’s Wheels’ for the historical correlation between union members’ imperviousness to dismissal and GM’s crap cars.) Although robots have largely solved the product quality problem, the worker-biased (not-to-say empowering) grievance procedures remain– and continue to prevent substantive progress on the factory floor. But this union power pales in comparison to GM management’s unassailable, like-minded brotherhood.

Did I say like-minded? Perhaps cookie-cutter would be a better term. GM CEO Rick Wagoner is a lifer who rose to the top through the GM’s accounting department; moving from Chief Financial Officer to Chief Operating Officer to CEO. His hand-picked successor, freshly-minted COO Fritz Henderson, was also a GM lifer who also rose to the top via the accounting department; and also attained the position of Chief Financial Officer. Career doppelgangers at the pinnacle of power at GM? How much more inbred– and insular– can a company get?

Is there any surprise that GM has eight brands stuffed with badge-engineered products when its executive roster is filled with badge-engineered executives? I’m serious. Uniformity of management leads to uniformity of decisions leads to uniformity of product. When all the people in charge are all asking the same questions, they’re all going to get the same answers. And the same answers lead to the same decisions which lead to the same results, again and again.

Here’s the thing. GM has finally woken-up to the crisis of their own creation. They now have that “sense of urgency” that analyst Mary-Ann Keller called for several years ago (when the excrement was striking the wind generator). As a result, Rick Wagoner’s mob are doing what they’ve always done– only faster. Their (tail-chasing) downsizing effort is accelerating. Their product cadence is quicker (thanks to re-badged imports). Their PR department's launching new ad campaigns and slogans at an even more furious clip. It’s more haste, less speed.

Ford and Chrysler hired outsiders to reverse their sinking fortunes. Whether or not Alan Mulally or Bob Nardelli has enough time and/or expertise to save the domestic automakers from oblivion is an open question. But at least FoMoCo and ChryCo are trying something new. GM is still ruled by the same man who sees no problem having a bankruptcy-proof pension while asking his workers to take a hit for the team to avoid bankruptcy.

Of course, there will be a reckoning. While the teachers’ union can still use their political muscle to maintain power, GM’s management has lost touch with (and sight of) its constituency: its customers. The "base" has left, and they’re not coming back. No one within GM management may take responsibility for this loss, but they are all to blame.

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  • DetroitIronUAW DetroitIronUAW on Apr 03, 2008

    They should take these golden compsation packages and put that money to the workers. We've slaved endless hours to build quality products. Only to be blamed for issues from design and mismanagment.

  • BlindOne BlindOne on Apr 04, 2008

    You poor workers, slaving away at a $30/hr job. I hear Walmart is hiring if you got it so bad. Seriously, I don't doubt that you work hard, but how can you claim being underpaid for the work that you perform?

  • Ronnie Schreiber From where is all that electricity needed to power an EV transportation system going to come? Ironically, the only EV evangelist that I know of who even mentions the fragile nature of our electrical grid is Elon Musk. None of the politicians pushing EVs go anywhere near it, well, unless they are advocating for unreliable renewables like wind and solar.
  • FreedMike I just don’t see the market here - I think about 1.2% of Jeep drivers are going to be sold on the fuel cost savings here. And the fuel cost savings are pretty minimal, per the EPA: fuel costs for this vehicle are $2200 and $2750 for the equivalent base turbo-four model. I don’t get it.
  • FreedMike How about the “Aztek” package? Wait, this car already has that…Said it before and I’ll say it again: they need to restyle the hind end on this car, stat.
  • Johnster "Vale" is the [s]cheap[/s] lower-priced performance version with black trim and stiff suspension."Mist" is the "DeLuxe" version with a bit more chrome and trim. (Sort of like the "Decor Package" option.)"Magentic" is the full-on Brougham treatment (in its current state) with more chrome trim than the "Mist" and all sorts of gimmicky electronic features inside. (Sadly, it will not include simulated landau irons or a vinyl covered roof, even as an option.)"Aurora" is the Oldsmobile of Cadillacs (sort of like the old Cadillac Calais). No, that's not right. It's the top-of-the-line model, sort of a "Grand Touring" version, with not as much chrome as the "Magentic" but all of the gimmicky electronic features and a stiffer suspension.
  • Drew8MR Why can't CARB leave hobbyists alone? Maybe lay off the low hanging fruit and go after the gross polluters. Bring back the rolling exemption.