While he and his senior management team have made many mistakes, I think recently he has been trying to do everything he could for GM. I saw him in an interview recently and he seemed humbled, to say the least.
It will be interesting to see if he gave his resignation “voluntarily” for personal reasons or decided that he didn’t stand a chance in hell of keeping GM viable without bankruptcy and resigned on his own.
The President told him to quit.
"They’’ made him a offer. ;-(
The President told him to quit.
I guess the President’s a “car guy.” Growing up here in the Detroit area as a kid, I heard that term used all the time. Since he and his people are “car guys” they must know something we don’t. Are there any “car guys” on the auto task force? Or are there some (which I think is the case) who’ve been given their “we must go green, or else” marching orders? Man…I hope that new Camaro sells like hotcakes.
T.
My guess is they know that they need someone’s head before they pour more money into GM. They need to make it more palatable for the public and not burn too much political capital in doing so.
Haim
Be afraid, be very afraid.
Actually it appears like they’re denying GM and Chrysler more bailout funds. That probably means they’re both going into bankruptcy. It’ll be interesting to see if that means they’ll sell off individual brands. Fiat making the Jeep? Sacrilege!
Maybe…or they may be trying to make it look like they are really playing hardball with the auto companies. The government already has a sizable investment in them that they will have to explain to the public if lost. My bet is they ultimately will not let them go into bankruptcy.
Haim
Be very afraid of what, exactly - the president demanding accountability and new leadership from a company that came to its doorstep begging for billions of taxpayer dollars - twice? President Obama has an obligation to make these kinds of decisions; would you prefer he reach deeper into your wallet, with the same leadership offering the same failed solutions?
GM lost their ability to make these decisions autonomously when they joined the welfare roll. I don’t like it any more than you do, but you play the cards you’re dealt. The end goal here is to save GM from itself, and the taxpayers from a multibillion dollar boondoggle; if Wagoner can’t do it, someone else will.
Demanding accountability for performance in order to ensure a return on the investment is one thing. To dictate strategic direction is quite another.
There are two ways to look at this -
The worst possible outcome is that the government now becomes involved in the manufacture of goods in a very involved way. That is a good definition of socialism and is not what this country needs.
Another way to look at it is, now Obama can go to the unions and say “I have gotten rid of management, now I need concessions from you”. They really don’t have a choice. If they say no, he then forces the company into bankruptcy and voids out all the contracts that are strangling GM.
I think Wagoner got the best end of this bargain if you ask me.
In essence I agree with you, but it’s the double standard that gets me. When will Obama ask all the other people on the welfare roles to “Step down” or start telling them how to live their lives.
I’m hoping two things. First companies will see shit like this and get some nuts and say “We’d rather fail than be run by the government” and second Obama get’s some balls and starts telling everyone else getting a chunk of the dole to do the same. Maybe people, companies etc etc will all start running away from the handouts.
But of course that’s not the goal is it?
I do find it interesting how these steps were taken on a company that has received 25B on sales of 180 in 2006 while not quite as drastic steps have been taken for AIG which has received 144B on 110B in total sales in 2007.
Again I can say I think that GM is a goner and unless the government decides to continue to bail them out, which I think highly likely, will be a goner and we’ll have lost the 25B. AIG I think will likely make it, although I suspect we might never get the 144B back.
~Matt
Do you honestly believe that Obama will get meaningful “concessions” from the unions?
Man…I hope that new Camaro sells like hotcakes.
BK,
Just last year there was a big announcement in Ontario that GM with added money from the federal and provincial governments, would save a production line in Oshawa, ON and have new plant space built for production of the new . . . . . . . . .Camero. Yes, that’s right!!
It’s stuff like this when you start to wonder how smart these guys really are. I know nothing about car production or design, but I do know that this was a laugher from the get-go and shows how little thought and forward thinking has gone into many of the moves the big three have done - up until quite recently. They honestly thought that the Camero, a dead muscle car brand, with a big engine, that uses lots of gas was going to be part of the solution for GM in Canada!! Yikes!
No, I don’t but I also do not want to live in a country where the government runs production so I am hopefull that he is wielding the bankruptcy stick as a way to gain concessions.
I am trying hard to give him the benefit of the doubt but it is not an easy thing to do.
Be very afraid of what, exactly - the president demanding accountability and new leadership from a company that came to its doorstep begging for billions of taxpayer dollars - twice? President Obama has an obligation to make these kinds of decisions; would you prefer he reach deeper into your wallet, with the same leadership offering the same failed solutions?
GM lost their ability to make these decisions autonomously when they joined the welfare roll. I don’t like it any more than you do, but you play the cards you’re dealt. The end goal here is to save GM from itself, and the taxpayers from a multibillion dollar boondoggle; if Wagoner can’t do it, someone else will.
I listened to the President’s speech this morning. It seemed there were some contradictions in what he was saying. For instance, he lauded GM for some of their recent successes (Buick being ranked the #1 most reliable brand in the world, 2008 Car of the Year), yet he says that they need to make changes to be a better company. Throughout that speech, his focus is turning there cars into “green” vehicles regardless of the ability for those cars to be profitable, which is what is needed.
The problem is not the cars that GM is producing, the problem is that people aren’t buying cars…regardless of who makes them.
In recent weeks, Ford has found HUGE demand in their pickup trucks and has re-opened a plant in Cleveland (I think it was there) and added shifts to their plants here in the Detroit area. I’m guessing that this would have been denied them had they federal money. I understand that when you are playing with someone else’s money your hands are tied, but if the President is serious about restoring the auto companies to a place of worldwide dominance (his stated goal from today’s speech) then he should give them the flexibility that is needed to be responsive to their customers and what they want to buy…not what he wants them to produce.
Bernie
The problem is not the cars that GM is producing, the problem is that people aren’t buying cars…regardless of who makes them.
Bernie,
Well that’s not entirely true - read my previous post in the thread about the Camero. However, the general gist of your post is correct - Automobile sales across the board are down massively - and that is the BIG issue here. The numbers are stark and staggering. I think that I heard that in 2007 Auto sales peaked and then dropped by nearly half for 2008 - that is an insanely fast drop for a business that can’t handle abrupt change like that. All the auto companies are struggling, it’s just that the U.S. makers were in worse shape going into this, so it’s no surprise then that they are suffering the most.
- that is an insanely fast drop for a business that can’t handle abrupt change like that. All the auto companies are struggling, it’s just that the U.S. makers were in worse shape going into this, so it’s no surprise then that they are suffering the most.
I know this is “woulda, coulda, shoulda” but I would have loved to see where the auto companies would have been had the economy in general not tanked. Ford in particular seemed to have an aggressive plan that was moving forward since Mulally came on board.
But that is wishful thinking.
Bernie
“Throughout that speech, his focus is turning there cars into “green” vehicles regardless of the ability for those cars to be profitable…”
bingo, now we’re getting somewhere. He will not get meaningful concessions from the Unions as his interest is neither the companies nor the shareholders.
these people scare the bejusus out of me…
http://www.carbuyersnotebook.com/gm-received-10000-camaro-pre-orders/
GM Received 10,000 Pre-Orders for the Camero, and most of those were for V-8s!
Despite the ‘conventional wisdom’ in the media, these are the kind of cars people WANT to buy. Some may not because of cost or fuel-economy, but given a chance there are still a lot of people who would get a V8 sports cars and large SUVs.
http://online.wsj.com/article/SB123776430557508813.html
Industry’s Big Hope for Small Cars Fades
Practically every small car in the market is stacked up at dealerships. At the end of February, Honda Motor Co. had 22,191 Fits on dealer lots – enough to last 125 days at the current sales rate, according to Autodata Corp. In July, it had a nine-day supply, while the industry generally considers a 55- to 60-day supply healthy.
For other models the supply situation is even worse. Toyota Motor Corp. has enough Yaris subcompacts to last 175 days. Chrysler LLC has a 205-day supply of the Dodge Caliber. And Chevrolet dealers have 427 days’ worth of Aveo subcompacts. At the current sales rate, General Motors Corp. could stop making the Aveo and it wouldn’t run out until May 24, 2010.