Leadership at US Auto Makers Must Go

carsLet me re-introduce the three stooges of Detroit:  Richard Wagoner (CEO, GM), Alan Mulally (CEO, Ford), Robert Nardelli (CEO, Chrysler).  You’ve met them on a previous post.

They came back to Washington DC last Thursday in hybrid cars, rather than private jets, asking again for a government bailout.  They prepared a more detailed plan for how such a bailout loan would be used to help the three struggling US automakers get through their financial difficulties.

While the public sentiment has not showered them with a lot of smypathy, it appears that the US auto makers will get some sort of a bailout loan, most likely money from a fuel efficiency research program.  It’s funny how the government can find billions of dollars in their programs.  The recent report that showed some 500,000 Americans have lost their jobs has definitely softened the resolve of some unsympathic politicans. 

After watching Curly, Larry and Moe during the saga, I still think a change in leadership should be mandatory as part of the bailout package.  These three men are embedded in a system that has taken the once most powerful auto makers into near obsecurity.  Their first trip in private jets is an example of how out of touch they are with reality.  They have a sense of entitlement that is worse than that of UAW.  We need fresh perspectives, real change in the industry.  

Let me state for the record that I’m not very optimistic about the bailout.  Any bailout now would not be a result of a compelling business plan that outlines a likely turnaround for these companies.  Rather, any bailout would be approved only because politicans are fixated on the declining job market.  

While we do need to keep America working, the fundamental issues behind the US auto makers’ plight must be fixed first and foremost.  That means having labor agreements that are competitive with their competitors.  That means having dealer structures that are competitive.  That means having a vision for the future.  That means having “Apple -like” understanding of consumers.  Why would any of us think that this leadership, with its track record, be capable of accomplishing such changes? 

Despite the cumbersome process of a bankruptcy, it would allow for a clean slate to come up with new ways of thinking.  Filing for Chapter 11 does not mean all workers will lose their jobs.  The companies will continue to operate.    

Regardless of my opinion, the government will pass some sort of a bailout plan.  The three stooges then will have a slightly longer lease to fail again.  I hope I’m wrong.