Just hours after Washington legislators told Rick Wagoner to come-up with a more compelling case for bailout billions, GM’s CEO assured The Detroit News that he’s ready to submit his new new new new new turnaround plan. “We’ve got the plans and are ready to go,” Wagoner told the hometown paper. “We’re not starting from ground zero here.” A rather unfortunate metaphor, and a less than compelling assertion. After all, if Red Ink Rick was ready to rock and roll, why wasn’t he a bit more, uh, forthcoming at the Senate hearing? [Needless to say, the DetN was not impolite enough to pop that particular question, simply stating that “He did not offer any details on what GM’s plan might entail.”] Meanwhile, displaying characteristic sympathy for the working man, Wagoner said that the delay caused by the Congressional recall “will be a bit nerve-wracking for us… But it’s the reality we face.” Note to Rick: it’s the reality you don’t face that kills you. More interestingly, it appears that the CEO’s anti-C11 rhetoric has softened slightly. Not. “Why would you take that risk at a time the economy is teetering on the brink. We need to do everything we can to get the business structured to get through a tough time and onto the future.” I think Mr. Wagoner just answered his own question.
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I know that crack is easily available in Detroit, but leader of automotive industry should exercise some abstinence, especially during those troubling times.
It sounds like Rick is growing a conscience. Good for him, he grew it from a safe place financially. Good for him. He is still in the dog house, but please give us the plan Rick. Although I wonder if congress has any business sense to even understand if anything Rick says has a possibility of working. Does Rick have any business sense himself? Maybe they all do, I just have not seen enough. Where is Americas business sense? I am scared, hurt, angry and sad, also excited, joyous, loved and happy. Looking forward to some interesting history.
Question: Why would you take that risk [Chapter 11] at a time the economy is teetering on the brink? (I’ll replace the period with a question mark since Rick is in no place to be asking rhetorcial questions)
Answer: We need to do everything we can to get the business structured to get through a tough time and onto the future.
Nice Catch
This is great, knowing the Senate Banking Committee and House Financial Services Committee will be looking at the plans to determine if they will work or not makes me feel so much better. Nothing but a load of eye wash. I don’t think either side really knows what it’s doing.
Here’s my plan to save GM, since you were woefully unprepared for your presentation of a lifetime:
1. Take UAW chief Ron out to lunch and explain Chapter 11 realities. Then extract 20% pay and benefit concessions. If he doesn’t agree. Go C11.
2. Announce plans for phase out of Buick and Pontiac over the next two years. Sell Hummer for whatever it brings on the market.
3. Make a 2/3 scale version of the Silverado truck with a diesel engine. If Mahindra can produce such a truck that gets 40mpg, you should be able to as well. If you can’t, file Chapter 7 instead.
4. Wagoner: Resign on acceptance of this plan by Congress.
5. Hire Werner Bernhard to reinvigorate the product line up. This is priority NUMBER 1.
6. Fix the quality of the Camaro (I saw the paint cracks and misaligned panels at the Seattle Auto Show and I was APPALLED at such incompetence. Are you kidding me???
7. Finally, listen to your Dealers! Dealers know what customers want FAR, FAR better than “management.”
Werner Bernhard? google finds nothing.
Dr. No –
“6. Fix the quality of the Camaro (I saw the paint cracks and misaligned panels at the Seattle Auto Show and I was APPALLED at such incompetence. Are you kidding me???”
Wasn’t that the one they used to film Transformers? I can excuse the cracks if that’s truly the case since it’s been around for quite a while. I didn’t see a single other Camaro at that show though.
Looks like the Americans will live to fight another day. Much to the chagrin of the “best and brightest”.
I think GM should change their corporate name from General Motors to “Gimme Money”.
Wagoner’s plan is still “suck less, details to be worked out later.” But with a little showmanship, Wagoner just might pull it off at the next committee hearings. A flashy powerpoint presentation, some fretting workers with their telegenic families in tow, maybe a trained monkey in a little uniform with tin cup; yeah, it could work.
And Rick, be sure to write this down. “Next time, jet-pool.”
Werner Bernhard = Wolfgang Bernhard
Noted to be brilliant about the auto biz. Do a Google search and you’ll find there is no shortage of articles about the man.
Looks like the Americans will live to fight another day. Pretty optomistic there, he hasn’t even shown the plan yet and it’s probably not very different from the last 5 successful plans he has had.
Stating something like that this fast is not going to help his situation, he should have waited until after the weekend to tell everyone he had a plan even if it was just the same old plan that isn’t going to work. At least people would think he put some serious thought into it. He is running a multibillion dollar auto company worldwide with MANY problems and a plan that is obviously not working, you don’t just come up with a great revolutionary plan that will make you profitable with a paltry chunk of $25B after a few hours of thinking.
I hope the media, congress and wallstreet calls them out on this tomorrow. I guess we will see if people can see it for what it is if their stock price crashes tomorrow. This should also tell everyone if the desperation is real they might be weeks away from death. It’s not going to encourage me to buy a car from them or buy their stock before I see this great plan. Not that I was going to buy one anyway, I’m waiting for the going out of business sale.
Red Ink Rick lost over $70 Billion in the last few years. GM can’t afford the interest on the debt they already have. loaning dollars to Wagoner is akin to giving an alcoholic a bottle of wine.
in 94 he became CFO without an accounting degree. our financials are still in disarray with “material weaknesses”
heading NAO he lost gobbs of market share.
becoming CEO in 2000, he took over a company worth $66 Billion with a solid dividend and decent balance sheet. whoops there it went!
he drove Olds into the ground, starved Buick nearly to death, spun Delphi but kept the liabilities, then sold us on surrending GMAC which he claimed would increase their ratings and lower cost of capital, ya right Rick!
he blew Billions on Fiat and hundreds of millions on legal fees and even more on investment banking “advice”.
oh and those pesky folks over at Fitch, S&P, and Moody’s.
better stop here, I’m getting ill…
Go to CSPAN and watch Bob Corker roast the CEOs. He asks Ron Gettlefinger to put the carmakers in order of health and he rated Ford as healthiest, followed by Chrysler, and finally GM.
They all sounded very intelligent but Ron did some real stalling when he did not want to answer questions about paying the labor bank wages. I think it was Corker that responded with a “Gimme a break!” when Ron said he’d have to go back and check the labor contracts….
All the CEOs answered in lock step. I was not impressed. Nobody is going to try anything too original.
Who are we to make fun of Rick Wagner, making 14 million a year to act so dumb.Who is the smart one here?
Who is the smart one here?
Not Rick, for sure. If he’d done a better job, he’d be making 114 million, and no one would be complaining.
Rick Wagoner had two “good” ideas:
cross-platform synergies. An idea straight out of accounting.
And he bet everything on it. Ruining every single brand in the GM portfolio in the process.
Rick: “Hey… Mulally.”
Alan: **sigh** “Yes, Rick?”
Rick: “So… the plan.”
Alan: “Yes, Rick.”
Rick: “What’s your plan like. You don’t have to tell me everything. I’m just, um, curious how your’s stacks up to mine. Congress is going to be rating us, you know.”
Alan: “You’ve heard our plan. Aligning capacity, aligning world-wide operations, cutting costs, 11 new models in the next two years… hunting with Cheney.”
Rick: “…hunting with Cheney.”
Alan: if only he would…
Rick: “So… Alan?”
Alan: “Yes, Rick?”
Rick: “Do you think it will work?”
Alan: “You don’t really have a plan do you Rick.”
Rick: “Yes, I do. I’ll type it up on my invisible typewriter, and then we can play race cars in Reid’s office!”
Alan: For f**k sake…
It’s hard to fathom the complete idiocy of this man and his minions. Seriously, a few hours of work and the plan is a go? Why hasn’t said plan been in place, announced and implemented 2 years ago? Or are we just using retreads, Rick.
Whose turn is it to give Rick his medication?
Bancho: If the Camaro at the Seattle Auto Show was some kind of mule from Transformers, sporting flaws on close inspection, why not disclose that fact? Other than a nonfactory paint job, who would possibly know this car was not a representative sample?
I got Wolfgang Bernhard’s first name wrong. Sorry Wolfie.
GM needs to learn that customers will pay premium $ for premium a product. Perception is reality: For all the strides GM has made (Silverado, Corvette, Malibu come to mind), it needs to be 20% better than the competition.
Changing hearts and minds after so many years of malfeasance will be no simple task.
Most execs would be thinking about now how to maximize revenue before the end of the year. For a car company, one might expect this to translate into moving vehicles. One might expect the execs to think about selling things to make money.
Not these guys. They don’t care any more about selling cars. They don’t care if they never sell another car. They are in a new business now, that of welfare queendom.
Selling cars is hard. Much easier for execs to spend time devising schemes to suck revenue from taxpayers directly.
10 years ago it was said that GM was not really a car company, it was a finance company because so much revenue came from GMAC.
It’s still true that it’s not a car company, but neither is it a finance company. Now it is just a con game company.
The fewer cars it sells, the greater the proof that it needs more money from taxpayers. Thus this is only the beginning.
The new turn of face for the Beggar 3 is that they need the bailout to “complete” a restructuring turnaround plan already months in motion, rather than to “start” one (to combat complaints that they just now see a problem and that $25B won’t be enough).
Of course, this is hilarious since they couldn’t outline the details of these already-in-progress turnaround plans when asked, and even today hedge, hem and haw, shuck and jive when pressed for real concrete plans. Same old, same old.
Any business that has competent management should already have a plan for returning the business to profitability. I will leave the discussion about competent management to others.
I am very amused at the spectacle of our representatives in Washington going over these plans. These representatives haven’t been managing our several trillion dollar government too well and wouldn’t know a sound plan if they saw it. Of course they can “fix” their mistakes because they have the wealth of the entire nation at their disposal.
I like buickman’s calling our attention to Wagoner’s full tenure at GM, not the last sixth months which might not be his fault.
Yes, GM was losing, money, brands, customers, talent, etc. for all of (and much longer) the eight years of tin cup Rick.
In any industry including the Presidency, after (or long before) eight years you are out of here. Rick is running GM like McNamara fought Vietnam, incrementally. His slow ratcheting down of products and development, in hopes of crossing the ever downmoving sales line.
You didn’t need to be a rocket scientist to know that the first major economic downturn would do this incremental crowd in. GM and Detroit have always had there down turn years, but they rose with new product and innovation to fight another year.
However, the one thing they never lost until now was credibility. Americans when they were ready and had the money would return to one place, (Detroit) to get their next car.
With being credible totally destroyed, why not do the bankruptcy thing and put this business model out of it’s misery? At least you get a fighting chance at coming back meaner and leaner.
I had a chance to watch some of Tuesdays hearings and the only one competent out of the group is Mulally who Congress couldn’t even pronounce his name.
My guess is Wagoner will recite the same BS he did on Tues only with better numbers. Look at the capacity we took out, look at the union concessions, and look at the 3 models out of 60 that have won awards and are competitive. Look at the hydrogen cars we are testing and look at the Volt. If we can only get to 2010 we will be profitable.
Congress needs to ask “When are you going to stabilize market share?” “How do you intend to win back the confidence of the American people?” “When do you intend to finally be able to sell cars without steep discounts?” “How can $10 billion actually get you to 2010 when you are burning through 3-5 billion per month?”
I like Dr. No’s plan but would add:
Step 8: Offer a warranty like Hyundai, if anything breaks within 10 years just fix it, no questions asked.
Its easy to come up with a “plan” when its just the same BS the Big 2.8 have been dishing out for the last few years. They’ll just update the dates from magical 2010 to 2012 (14? 16? 18?) in order to prove this new, new, new, V2.0 plan is based on long term goals. More of the same = same results, no shock there. So they are just delaying things a few more years but using OUR money to do it!
It would take a huge set of round-ish hanging things to admit the REAL problems (as RF has been doing for 3 years on this very site). And we all know that’s never going to happen with these morons at the (learjet) controls.
RobertSD: “hunting with Cheney”
You owe me a new keyboard and another coffee
Any truth to the story that Oil Companies have been paying the government to keep US Auto Manufacturers from building fuel efficient models?