What a day yesterday.
General Motors CEO Rick Wagoner steps down (because President Obama told him to), the White House announces a bailout cutoff for GM and Chrysler (within 60 and 30 days, respectively) and a state warranty program should both automakers fail, Chrysler CEO Bob Nardelli says a Fiat partnership is advancing (but still dependent on $6 billion more in government aid), and Proton - the Malaysian state automaker that owns Lotus - said days after the Tesla Model S launch that it will retrofit its cars with electric powertrains and sell them in the US under the pre-WWI name "Detroit Electric."
Today Ford said it would cover monthly payments of up to $700 for up to a year on all its cars should customers lose their jobs (except Volvo, which could slip into a ill-fated tangle with the Chinese). GM just followed suit by offering up to $500 per month for nine months. Incredible.
Yesterday turned GM and Chrysler into steaming slabs of fresh, raw meat that columnists and editorial boards could have savaged. But many opinion pieces in the largest metro dailies refrained, and surprisingly, placed more skepticism on the Obama administration.
"Mr. Obama has not only failed to understand these contributions, he has also deprived G.M. of Mr. Wagoner’s presence on the board. Much of Mr. Wagoner’s knowledge and experience could simply be lost. With Mr. Lutz also about to retire, the two executives most responsible for G.M.’s transformation are gone."
"But we're more comfortable letting the companies' stakeholders decide what the firms should look like in the future, rather than having the administration decide what's best for them and the car-buying public."
"It is worth pointing out, however, that the $17.4 billion the federal government has lent GM and Chrysler since the bottom fell out of the automotive market last fall is dwarfed by the more than $1 trillion we've poured into the financial sector."
And then there's rather oversimplified arguments, such as how the Globe's Derrick Jackson compares an Escalade Hybrid to a Prius as reason for GM's failure:
"It is too late. The engines from Japan are passing 50 miles per gallon. GM still brags about a Jurassic that gets 20."
But GM's poor decisions stem far deeper than introducing a new Escalade right as full-size SUV sales plummet. Paul Ingrassia of the Wall Street Journal explains:
"There was a "can't do" mentality that accepted too many brands, too many dealers and too many workers as immutable facts of life that could only be changed slowly and gingerly, if ever. That might have worked had Americans continued buying big pickups and SUVs at a record-setting pace for another decade or two. But that prospect never was realistic, even before car sales collapsed nine months ago."
It's worth noting that Toyota still sells the Land Cruiser and Sequoia, two overweight trucks that don't even crack 20 miles per gallon on the highway. But Toyota has been smart enough to leverage other segments - namely, non-hulking cars - instead of ignoring them. So too, will GM and Chrysler.
All they need is 30 to 60 days, right?
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