While Swade’s away on business travel (always tons of fun — not), I’ll throw in a few nuggets about how the General is faring here in the United States.
In a nutshell, things are “not too good”.
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According to my own Djup Strupe in the GM Spring Hill plant, the GM plans are pretty simple at the working level: if it costs money, stop doing it. That much you could probably guess without too much trouble.
However, one thing that surprised me was that even though these edicts are out there, there are major exceptions for developments of “next generation” automobiles.
In his case, I’ll guess that he’s referring to the long-rumored hybrid version of the Chevrolet Traverse. In either event, I believe that this could be a great loophole for development funds for certain Saab projects. Maybe. If I’m really wishful. At least the technology could make its way to Saab through the sharing arrangement. I’m not holding my breath, but it could happen, especially is one of the Saab bidders needs a little “extra” to close the sale of Saab.
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Bob Corker, the junior Senator from my home state of Tennessee wrote an open letter published in the news this week:
UAW’s resistance thwarted plan to help GM survive
By U.S. Sen. Bob Corker • April 5, 2009
In December our office tried to broker a deal that would have resulted in bipartisan support and provided a viable road map for General Motors to move forward.
As we worked through that plan, every stakeholder agreed to shared sacrifice except the United Auto Workers, where we met resistance.
In fact, somehow in offering a plan to help the company survive, one that made common sense and would have garnered bipartisan support, I became public enemy No. 1 with the UAW and the AFL-CIO.
Unfortunately, none of us can know what would have happened if there had been cooperation among all the stakeholders in December and we had been able to move forward with our plan to solve decades-old problems and protect taxpayer investment.
We do know the results now. In one fell swoop, our government has taken over a company — it fired the CEO, replaced the board, is involved in making decisions about which plants will survive and what kind of cars they will make, and now appears to be directing the company to bankruptcy.
In bankruptcy, the same UAW contracts that were the focus of our negotiations in December would change dramatically and bondholders would take huge write-downs on their investments. Unfortunately, because these steps weren’t taken in December, billions of taxpayer dollars are now down the drain and more stringent, draconian measures will be put in place.
Regardless of what got us here, the members of the UAW across Tennessee are my constituents, and though they may have disagreed with my approach this fall, there should be no doubt that I want the very best for them, their families, and the many people throughout our state who depend on the auto industry.
I called to congratulate Fritz Henderson as soon as he was announced as GM’s new CEO. Fritz and I have had a lot of interaction over the past six months and enjoyed a good relationship. I have offered my support in his efforts to do what’s best for GM.
I have also spoken with Steve Rattner, head of the administration’s auto task force, and sought his strongest assurance that politics will be left out of the decision-making. I certainly hope that is the case.
If the administration uses factors like efficiency, flexibility and the quality of the workers, our modern, adaptable GM plant in Spring Hill should do very well. Spring Hill is the kind of facility that represents what made the American car industry a world leader in technological innovation. Hopefully it will play a key role in GM’s resurgence.
I completely agree with Mr. Corker. The UAW has been obstinate and out of touch.
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Which plants to close? The question gets a little political.
From the above referenced article in Forbes:
According to industry analysts, Lansing and Spring Hill are modern, recently refurbshed and critical to future success:
The Lansing and Spring Hill plants should be safe if operating decisions are made rationally, said David Cole, chairman of the Center for Automotive Research in Ann Arbor, Mich.
“Spring Hill is still a relatively new plant and has been refurbished to make it much more flexible than it has ever been,” he said. “It’s a very good plant, and when the economy recovers, those GM crossover vehicles are going to be very strong.
“It would be a shame for GM not to be able to meet consumer demand because they closed one of the plants. If they walk away from that plant, that would be a very strategic error,” Cole said, “but in politics anything is possible.”
Yikes, so what to politics have to do with making cars? Quite a bit according to another industry analyst quoted in the same article:
“Spring Hill could be on the bubble because it’s in a red state [Tennessee], and Michigan is a blue state,” Merkle said. “The governor of Michigan is a Democrat, too, and she needs all the plants she can get.”
For those of you outside the US, “red” has come to denote Republican, while “blue” has come to denote Democrat. President Obama is a Democrat, and these opinions imply that he and his minions will help those that elected him and punish those that voted against him.
For the record, Tennessee’s governor, Phil Bredesen, is also a Democrat.
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Finally, in an act that rivals the proverbial re-arrangement of chairs on the sinking Titanic, General Motors is slowly auctioning the GM Heritage Collection to raise funds and save on maintenenace and storage costs.
The Barrett-Jackson auction in Palm Beach, Florida tomorrow (April 9), will include many of the latest to be sold.
Most of the cars are real yawners in my book — who cares about the last Saturn Ion made, for instance? Three that I’d choose to bid on:
1941 Cadillac Series 61
1956 Oldsmobile Delta 88
1972 Pontiac Grand Prix
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