Living like the masses, "massive pay cuts, no bonuses, not allowed to stay in decent hotels, no corporate airplane." Having to stand in line… Life for Bob the Car Salesman isn’t quite as good as life for Bob the Vice Chairman. – Ilene the Editor
At Auto Show, GM Seeks To Shift Perceptions
The North American International Auto Show in Detroit is about to open to the public — and it is part hi-tech expo, part pep rally for the U.S. auto industry.
It is such a bad time for the industry that some familiar exhibitors, like Nissan, aren’t even there.
So what are the stakes for the biggest U.S. automaker, General Motors Corp.?
GM’s auto show exhibition is all about battery-powered vehicles like the plug-in Chevy Volt. On Monday morning, GM’s top executive announced that the company will partner with the South Korean firm LG Chem to make lithium-ion battery packs. At the earliest, the Volt will hit the market in late 2010.
In the short term, GM’s success is a lot more dependent on conventional automobiles, like the family sedan. Vice Chairman Bob Lutz shows off the Chevy Malibu, which he notes was 2008 Car of the Year, selected by a jury of 50 independent North American journalists — and that’s in part because it has "incredible amounts of leg room, almost limousine-like proportions."
The 45-Year Auto Veteran
At the auto show, Lutz is like Jack Nicholson at the Oscars, or Ted Kennedy in the Senate. At 76, he’s trim and tanned. He still epitomizes the swagger of the car business as it used to be. Lutz was Phi Beta Kappa at the University of California, Berkeley and a Marine Corps aviator. He has been a big deal at Ford, Chrysler, BMW and GM, where he has returned from retirement to be vice chairman.
If GM is to survive, Americans who’ve been buying Camrys and Accords have to start buying more of GM’s Malibus…
Can GM Change Consumer Perception?
But Lutz, like many Detroit execs, says, "Read the reviews, test-drive the cars; they’re much better now." Why is there a gap between what the automotive press says and what the public says? Lutz says perceptions die hard.
"Back 15 or 20 years ago, it was the people who really knew about cars and knew what they were doing who made those statements," Lutz says. "And then it filters down to the less and less knowledgeable. And now the whole cycle is starting again at the top, where the knowledgeable people who truly understand the business now say the new range of General Motors cars are probably the best vehicles of their types in the world. And that’s going to trickle down — but it takes time."
Lutz also says GM doesn’t advertise enough because the company can’t afford it…
Operating On Washington’s Nickel
But with GM and Chrysler on federal life support, and Ford only slightly better off, will Washington second-guess questions like, "How many Malibus is the right number to produce?"
Lutz has been in the car business for 45 years, so it’s a change for him to operate on the federal government’s nickel.
"I’ve never quite been in this situation before of getting a massive pay cut, no bonus, no longer allowed to stay in decent hotels, no corporate airplane. I have to stand in line at the Northwest counter," Lutz says. "I’ve never quite experienced this before. I’ll let you know a year from now what it’s like."
And in terms of the decisions that executives make at GM, how are they different? Lutz says they don’t know. That’s because Washington has not yet appointed a car czar, the government’s designee to oversee the loans to GM and Chrysler.
[Photo: GM Vice Chairman Bob Lutz unveils the Cadillac Converj electric car Sunday at the North American International Auto Show in Detroit. AFP/Getty Images]
