#people

With the luxury market defying sluggish economic conditions, Daimler CEO Dieter Zetsche doesn’t want the upstarts at BMW and Audi to slip past it… which they are. Six months through 2011, the Mercedes brand found itself in third place among the German global luxury brands, at 610,531 units. A surging BMW captured 689,861 sales in the half, while Audi took second with 652,970. This, for Zetsche, is an unthinkable state of affairs. In a letter to his employees, excerpted by Automotive News Europe [sub], Zetsche makes it clear that leadership in the luxury space is a Daimler birthright.

Some of our competitors are now growing faster and more profitably than we are. Granted, those are just snapshots in time and should not be overestimated. After all, many of our best new products are yet to come… In the long run we can’t be content to be in a “solid second” or even “third” place: We are Daimler – we should be far ahead of the pack! And if that requires something that we don’t currently have, then we’ll identify and develop it.

Enjoy your summer and refill your tanks. Because in the second half of this year we’re going to continue to play some hard offense!

But does a sense of entitlement actually motivate workers?

In an extended interview with Fareed Zakaria this weekend, GM CEO Dan Akerson repudiated a lot of GM’s previous optimism about hydrogen fuel cell cars, saying

We’re looking at hydrogen fuel cells, which have no carbon emissions, zero. They’re very expensive now, but we’ve, just in the last two years, reduced the price of that technology by $100,000. The car is still too expensive and probably won’t be practical until the 2020-plus period, I don’t know. And then there’s the issue of infrastructure

The DetN points out that GM had previously said that it would have anywhere from 1,000 to “hundreds of thousands” of fuel cell cars on the road by 2010, and most recently said (in 2009) that the technology would be “commercialized” by 2015 and “cost-competitive” by 2020. So, if hydrogen is moving to the back burner, what’s moving up? Akerson revealed that

soon we’ll be introducing “bi-fuel” engines which can burn both compressed natural gas and liquid gasoline.

We’ve seen GM take early steps towards bringing a natural gas-powered car to the road, but this is the first sign from a top executive that a dual-fuel car is a certainty in GM’s near future. By talking down hugely expensive hydrogen cars and talking up cheap natural gas powerplants, Akerson sends a strong message that GM’s green car efforts are moving in a more pragmatic direction. Hit the jump for part two of the interview, in which Akerson talks gas tax and green cars.

SvD.se reports that Paul Akerlund, Saab’s former IF Metall (one of Sweden’s largest trade unions) representative and now Trollhättan Municipal Council Chairman, has called for the resignation of Saab CEO Victor Muller, saying

I do not think Victor Muller is a good president. He is an owner and a contractor, but he has not sufficient knowledge about how to manage production and development

And Akerlund is no city government busybody, but a longtime company insider who has been influential in Saab’s post-GM life. Having shepherded Saab through the challenges of the past two years, this is another grim sign that Saab is about to succumb to the realities that have dominated TTAC’s Saab coverage for years now. A commentary in SvD, titled “ Thank Muller for Painful Bankruptcy” sums up the somber mood in Sweden:

[Saab] has been on artificial respiration for nearly two years. It is down now, and from all indications we can only conclude that the whole process was a painfully protracted bankruptcy. And we have only one person to thank for it.

[UPDATE: Fiat press release outlining the complete new management structure added]

The awaited consolidation of Fiat and Chrysler operations is complete, reports Bloomberg, and CEO Sergio Marchionne is taking the North American job for himself. Joining Marchionne at the top of the company’s new regionally-based divisions, are Gianni Coda, former head of purchasing at Fiat and now the boss of European, African and Middle East operation; Cledorvino Belini, erstwhile head of Fiat in Brazil is now in charge of all of South America; Michael Manley, previously boss of the Jeep brand, will be leading the firm’s effort Asia. These four regional bosses will be part of a 22-member “group executive council” which will manage all of Fiat and Chrysler’s operations. The details of the council’s makeup still haven’t been released, but the big news is well encapsulated by a quote from Gianluca Spina, chairman of the business school at Polytechnic University of Milan.

Marchionne’s decision to keep the role of overseeing the business in North America shows that the center of gravity of the combined entity will be in the U.S… The integration process is going extremely fast, as is Marchionne’s style.

I was just a pre-licensed car nut when the July 1994 issue of Car and Driver passed along the news of Ayrton Senna’s death. Brock Yates’ column in that issue said, “In a sad way, Ayrton Senna’s death dignifies motor racing…He did not die in vain, but rather he made the ultimate sacrifice in seeking his own personally mandated pinnacle of achievement. Tragically, ironically, he may serve his chosen profession more in death than life.” This meant nothing to me at the time. But it means something now.

Earlier this year when it seemed that a price war could be brewing in the US market, one of TTAC’s industry sources noted that the problem wasn’t strictly a question of business competition. Speaking on background, the source told us that when speaking with old friends at Ford and GM, the level of mutual distaste for each other is very high…it seems to be getting personal. Lots of egos involved, [which] increases potential for short-sighted decision-making

At the time, I was willing to chalk up this animosity to the usual industry hyper-competitiveness (or at least a return to form after the lockstep mutual support of the bailout era), but it seems I should have paid more attention to our source’s concerns. As it turns out, the bad feelings between Detroit’s cross-town rivals has apparently gotten worse…

Every time Sergio Marchionne makes the headlines, I half expect him to announce that he is not merely a mild-mannered accountant with a fondness for frump, but a mighty superhero, born to rescue failing automakers and the American and Italian ways of life. Having scored a sizable stake a bankruptcy-rinsed Chrysler for no money down, Marchionne has been ruling his Italian and American empires with resolute authority… and 50 direct reports. But Automotive News [sub] isn’t reporting that Marchionne spends his spare time in tights and a cape fighting Russian bandits and Italian labor unions… the word is that Sergio Marchionne is ready to delegate some authority. According to AN’s sources, Marchionne’s plans includes three basic planks:

• Create four regions — Europe, North America, Latin America and Asia-Pacific — each with a regional boss.
• Require brand bosses, who are powerful in the current organization, to work closely with the new regional bosses.
• Establish a new layer of management, tentatively dubbed the steering committee, that would help run Fiat and Chrysler.

But is this new structure really going to end what AN terms “the one-man Sergio show,” a routine of 18-hour days and “catching catnaps on the plane as he flies constantly between Turin and Detroit”? Will it really “help overworked Chrysler executives catch their breath and adopt a saner work rhythm,” as AN puts it? That question remains to be answered…

When Fiat and the US government collaborated to bail out and restructure Chrysler, many hailed the news as nothing less than the rescue of the American auto industry. Though Fiat CEO Sergio Marchionne became CEO of the Auburn Hills-based automaker, he maintained much of its management corps on the strength of brief interviews, only relieving a few key members of the old guard. But the debate over whether the rapidly-aligning Fiat-Chrysler is more Fiat or Chrysler is going to be resolved “pretty quickly” according to Marchionne, as Bloomberg reports that a unified management structure is in the works.

Marchionne is working on management changes as he steps up the integration of the two companies. He plans to merge the carmakers to reduce costs and achieve a target of more than 100 billion euros ($140 billion) in combined revenue by 2014. The executive said in May that the timing of a merger hasn’t been decided yet, adding that a combination isn’t likely this year.

But just as there was furor in Italy when Marchionne suggested that the unified Fiat-Chrysler could be headquartered in Detroit, the unified management structure could be yet another source of controversy. It will, after all, be the most direct signal yet as to whether Fiat-Chrysler is an Italian firm with global operations, an Italian-American alliance or a truly global firm. For one thing, unified management should force Marchionne to commit to a single headquarters for the group, reviving a controversy he temporarily cooled by fatuously suggesting there be four Fiat-Chrysler “headquarters,” in Turin, Detroit, Brasil and “Asia.” Having masterfully finessed the PR messaging transition from “rescue of an American automaker” to “wholly owned subsidiary” thus far, a unified management could bring up a lot of unresolved issues. In short, it’s a branding challenge that makes the Chrysler-Lancia transformation look like child’s play…

Alan Mulally should be named Chairman and CEO of General Motors…immediately. The General needs talented executive leadership with experience in the automotive industry. And if you look at the track record so far of GM’s present top management – Lt. Dan and his sidekick Girsky – there’s no reason to believe they’ll do any better tomorrow.

I love General Motors. I’m bringing this age-discrimination suit action because it’s the right thing to do — for me, my family, as well as my GM peers who have been severely affected by GM’s conduct.

A critical aspect of GM’s turnaround was breaking a culture that has been held up for decades as an example of insularity, stagnation and inefficiency [for more read Ron Kleinbaum’s classic four-part editorial on the subject here], a task that various recent CEOs have gone about differently. Fritz Henderson had a “change agent” vanguard approach, while Ed Whitacre took more of a “set tough goals and fire regularly” tack towards GM’s culture wars. But regardless of differences in tactics, everyone’s agreed that GM’s culture needed to be seriously retooled if the company’s huge advantages after a government-backed bankruptcy-bailout weren’t going to be pissed away, and as a result a lot of GM’s “lifers” found themselves on the outside looking in. And rather than slinking away, one of those jilted lifers is suing GM for age discrimination.

Typically we try to accompany our book reviews here at TTAC with an author livechat, giving you, our readers, a firsthand opportunity to engage influential thinkers in TTAC’s trademark frank, open discussion of the most important automotive issues of the day. Today, however, is something of an exception. As I noted in my review of Car Guys vs Bean Counters: The Battle For The Soul Of American Business, Bob Lutz’s call-out of myself led to an opportunity for me to exchange words with the former GM “car czar,” which in turn led to his graciously agreeing to meet me for a face-to-face interview. Because Lutz is in the middle of a book launch media blitz (not to mention my own fairly well-laden to-do list), that will have to happen later this summer… but I assure you, it will be worth the wait. Meanwhile, I thought that we should at least honor the spirit of our author livechats by giving you the opportunity to submit your own burning questions for “Maximum Bob.” I can’t guarantee that I’ll be able to get answers to all of them, but I’ll certainly do my best to make sure that the most germane queries at least get an airing. After all, if I’m going to tangle with one of the more formidable figures in the auto industry, I’ll need the full weight of TTAC’s inquisitiveness and savvy at my disposal.

Edmunds recent Auto Safety Conference featured a number of high-profile speakers including NHTSA Administrator David Strickland, Edmunds CEO Jeremy Anwyl, IIHS President Adrian Lund, Toyota Under Fire author Tim Ogden, Rep John Dingell and more. I haven’t had time to watch all of the presentations from the conference, but from what I’ve seen, the conference seems to have been one of the most forward-thinking, diverse and lively explorations of auto safety in recent memory. The video above, featuring Virginia Tech professor Tom Dingus, offers enough provocative insights to fuel a lengthy discussion on distracted driving, but I encourage you to go check out the rest of the speakers here, and if you really want to get stuck in, you can download their presentations here.

When is a brand not a brand? Or, perhaps the real question here is “when does a brand become a brand?”. In any case, Chrysler introduced its Street and Racing Technology “brand” way back in 2002, and has sold SRT versions of Chrysler, Dodge and Jeep vehicles ever since. But for 2011, a model-year which saw the launch of the group’s Fiat-fettled lineup, the SRT lineup dwindled to just the Challenger SRT8. Now, Chrysler is announcing the “re-creation” of the brand, while noting that

While we still made SRT vehicles, there wasn’t as concerted effort in development and marketing in recent years.

The Detroit News snagged a lengthy interview with GM CEO Dan Akerson, giving observers one of the first in-depth looks at the man who will be leading The General for the next three to four years. The interview is to lengthy to summarize here, but there are a few items that are worth noting…

I am sorry I am being brash but when you owe money to people and you pay them back you shouldn’t be celebrating. You just cut them a check and send them home and say thank you on your way out

We’ve given Fiat/Chrysler CEO Sergio Marchionne some grief for his somewhat unseemly self-congratulation at his repayment of “every penny loaned less than two years ago.” This quote, given to CNBC, is more what we were looking for. After all, one imagines that Chrysler doesn’t hold such celebratory spectacles for folks who finish paying off loans on their Calibers and Caravans. Acknowledging the mundanity of Chrysler’s Wall Street re-fi is a much better way for the firm to re-boot its post-bailout relations with the American people. For this quote, as much as for the promising but still-wildly-uncertain turnaround of Americas most troubled automaker, I am happy to extend Mr Marchionne and his team a modest, unceremonious word of thanks.