Bailout Watch 142: ALL NEW! World's Most Extreme Detroit Apologists

bailout watch 142 all new worlds most extreme detroit apologists

Tonight. On World’s Most Extreme Detroit Apologists… Move over Jerry Flint! Forbes’ ancient and once venerable scribe thinks GM CEO Rick Wagoner hasn’t raped stockholders by pocketing more than $100m in executive compensation. But The Detroit Free PressJustin Hyde and Brent Snavely are willing to go even further. While their most recent mega-apologia predicts the end of Wagoner’s misguided management, the writers are happy to give the floor to analysts who suggest that Wagoner’s done- and is still doing— a great job. “Erich Merkle, an analyst from Crowe Horwath LLP, said Wagoner inherited years of bad decisions from previous managers that have limited his options. ‘You almost need to put Roger Smith on the hot seat, and I know he’s dead,’ Merkle said of the CEO who led GM from 1981 to 1990. ‘They were setting the company up for disaster later down the road. The business model that was created and the way that the contracts were structured were such that they were just not economically viable.'” Mea culpa be damned. And you can be damned sure that Merkle isn’t the only one blind to Wagoner’s cataclysmic effect on GM’s business…

Hyde and Snavely point out that an anyone who bought $10k worth of GM stock in June 2000 — when Red Ink Rick was named president and CEO — would see their stake diminish to just $860. And yet, “GM’s decline has done little damage to Wagoner’s stature among industry executives because its Detroit rivals have done no better. ‘Rick is very highly respected, and he is a very good leader,’ said Neil DeKoker, president of the Original Equipment Supplies Association. ‘They are just facing challenges that are bigger than any one individual or group of individuals can handle.'”

So it is just a question of great landing too short runway. Aaron Bragman, automotive analyst for IHS Global Insight, say yes. “Ehe biggest criticism he hears of Wagoner is that while change has occurred, it hasn’t happened fast enough. ‘And actually, I have been fairly impressed with his turnaround plan,’ Bragman said. ‘They have gone from being largely a group of fiefdoms around the world to what seems to be a very well coordinated company.'”

R-E-S-P-E-C-T. Tell me what Rick means to thee. “‘I think he’s as respected as anybody in the industry. I think he’s earned that. He’s been managing in a very difficult period,’ said David Cole, chairman of the Center for Automotive Research in Ann Arbor. ‘You’ll see that he has led a very important transformation.'”

And that’s what happens when you got and look for… Detroit’s Most Extreme Apologists.

Comments
Join the conversation
2 of 8 comments
  • Psarhjinian Psarhjinian on Nov 03, 2008
    There’s a reason he’s still there. A business-based reason. Don't assume that businesspeople are infallible.** Two of the most terrible sicknesses to infect a corporation are as follows: * Management, especially upper management, being unable to admit mistakes for fear that an admission of fallibility calls everything else they have or may do into question. * Front-line and lower-management's unwillingness to either a) call upper-management on it's failures or b) present real evidence that failure is happening at all. Many, many businesses fall victim to this, especially when management abstracts itself from the business. It doesn't matter if you're managed by engineers, accountants, lawyers or plumbers: lose track of the fundamentals, let the process become more important than the product and/or start worrying about fallibility instead of results and you're in a world of hurt shortly. Ironically, "smart" people are just as, if not more, susceptible to this. It's easy for, say, Joe Plumber to admit fallibility; it's much harder for, say, Rick Wagoner or George Fisher to do so. They should know better, heck, they do know better. They're the smartest guys in the room, the best and brightest, they can't be wrong. ** Two examples from GM's own board: George Fisher presided over Kodak's implosion at the start of the digital camera age by failing to track the way the industry was going; he's also notable for starting Motorola's fall from grace. Eckhard Pfeiffer effectively killed the successful, independent Compaq, weakening it through non-core acquisitions and making it a target for more focused companies like Dell. Any of this sound familiar?

  • Gus Gus on Nov 07, 2008

    David Cole, head of the Center for Automotive Research is a complete buffoon, far removed from reality and a total tool of the US auto industry. I'll laugh when, unlike GM, Ford and Chrysler "employees" who are paid to not work, he's on the unemployment line. It's apologists like him, on the industry's dole, who help keep us from a real solution for the industry, which is on death's door.

  • Funky D Soooooooooo ...[list][*]Locally sourced parts are going to be more expensive than their Chinese counterparts (not a knock, just a fact)[/*][*]Prices of EVs are already up sharply[/*][*]So let's cut subsidies and make them even more expensive.[/*][/list]What a way to "reduce" inflation, which is just one of the major fails in this Charlie Foxtrot of a bill.
  • Kcflyer Guess we know who didn't give enough bribe money (aka campaign contributions) during the latest cycle. Got to pay to play boys and girls.
  • Ima65688420 I'll consider an EV when it can do what my ZR2 diesel can do with similar range and refuel times.
  • SCE to AUX Irony is everywhere:[list][*]The mfrs come to Washington asking for a steak, but get a burger instead. Gov't says "we gave you a meal."[/*][*]The alleged purpose behind EV subsidies is to clean up the air, but domestic content requirements means it's really an American nationalist agenda.[/*][*]Tesla lobbied against more subsidies on philosophical grounds, but got them anyway.[/*][*]Rebates on used EVs will drive up the price of used EVs.[/*][*]EV startups necessarily start with higher models, then work down-market. The new rules shut out Rivian and Lucid just as they are trying to get traction. But maybe - as with Tesla ca. 2018 - they won't lose high-dollar customers over a 'few bucks'.[/*][/list]What a mess.
  • Ajla Much like with CAFE I think the new MSRP limits should be set to a single level instead of $55K for cars and $80K for "trucks".
Next