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Summary:

UPDATED In the interest of avoiding another Jetgate, Detroit’s Big Three auto executives are leaving their leased corporate aircraft on the ground this week. All three will drive to Washington, D.C. to present “viability plans” as part of their second bailout plea. Ford CEO Alan Mulally […]

UPDATED In the interest of avoiding another Jetgate, Detroit’s Big Three auto executives are leaving their leased corporate aircraft on the ground this week. All three will drive to Washington, D.C. to present “viability plans” as part of their second bailout plea. Ford CEO Alan Mulally set off on the roughly 520-mile trip yesterday in an Escape Hybrid, and General Motors chief Rick Wagoner plans to drive most of the way today in a Chevy Malibu Hybrid (he may also hop into a Chevy Cobalt XFE or Buick Lucerne for part of the trip), the companies announced yesterday. (Update: Wagoner ended up driving a prototype of the Chevy Volt for part of the trip.) Chrysler also decided to join the hybrid parade, saying CEO Robert Nardelli would drive a hybrid vehicle (no model named) to congressional hearings on Friday.

The idea of legislators ridiculing millionaire executives into traveling like ordinary folks has generated no small amount of buzz (just a few examples: New York Times, LA Times, Reuters). But if the Big Three want to demonstrate commitment to innovation and fuel-efficient vehicles (aka viability), the models they’ve chosen offer too little evidence, too late.

Take the Chevy Malibu Hybrid, which GM lists on its web site as having “very limited availability.” The EPA rates it at just 34 mpg for highway driving — an underwhelming 2 mpg improvement over the regular Malibu. For comparison, the 2009 Toyota Prius and Honda Civic Hybrid get 45 mpg on the highway. Even the regular Civic, rated at 36 mpg for highway driving, has better fuel economy than the hybrid Malibu.

The 2009 Ford Escape Hybrid, on the other hand, has better fuel economy (31 mpg highway) than any other SUV. But a shining example of forward thinking it is not. As New York Times car reviewer Christopher Jensen put it earlier this year, “When Ford introduced the 2005 Escape Hybrid it broke new ground. Unfortunately, the automaker didn’t continue that tradition with the 2008 update, which comes across not as hot stuff, but as barely warmed-up leftovers.”

Part of Mulally, Wagoner, and Nardelli’s goal on this trip is showcase their cars. That much seems doable. But if they had put this kind of spotlight on improving fuel-efficiency when the Malibu, Escape, and other vehicles were in development, their industry could be on a very different road today.

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  1. When Nancy Pelosi flew into Ann Arbor for a book signing (not exactly government business), she flew in her own Boeing 737, care of the taxpayer. Last time I looked, the U.S. wasn’t running a budget surplus either.

    Corporate jets, while seemingly luxuries, are intended to make the best use of executives whose time is very valuable. At $10M per year, divided by 2000 hours per year, you get $5000 per HOUR which is what their time is worth. Should these hours be wasted hanging around airports, because their commercial flights are running late?

    One can argue whether executives should be paid so richly (the auto companies are not out of line with the rest of corporate America on this matter) but one cannot argue that given this salary, a company employing their own aircraft to move these people about is not a wise decision.

    Pelosi and others obviously think their time is worth spending $100K or so per flight. Compared to that, the Big3 are absolute penny pinchers.

  2. The government should require that the executives and the company board resign before they get any money.

  3. It’s the sense of entitlement that’s so irksome. No wonder the “big three” are in trouble. Their management are completely out of touch with what regular people want. How many miles does any one of them put on one of their own cars in a given year?

  4. Alex,

    I agree. But doesn’t that apply in spades with the bankers? Why aren’t they being dragged over the coals? The automakers, for all their faults, at least build something, rather than shuffle other people’s money around in a way that turned out to be highly irresponsible.

    Detroit’s big problem had been wage inequity compared with non-union states like Alabama and Georgia. That has been addressed, but the full benefits won’t take place until 2010.

    The thing that irks ME about this situation is that both political sides are wrong about this issue. The Republicans oppose the bailout, for the wrong reasons (mostly it’s because they live in Southern states with foreign automaker plants that would benefit from a Big3 collapse), and the Democrats support a bailout for the wrong reason (not fighting the unions hard enough is what got the Big3 in this trouble in the first place.)

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  6. Good to know that ignorance and outrage are in such good hands. I guess I can only pray for journalism losses because they couldn’t compete on

    a fact-by-fact basis with their far more objective and non-lazy foreign competition…from the CBC in Canada to China and even Iran! No

    seriously…

    I won’t waste to much time here, but it just really pisses me when enviro lefties who sit in judgement while they tool around in their

    Toyota/Honda Blanks and then bitch about why the economy seems broke, but wouldn’t know the multiplier effect of manufacturer if it came in

    supository form.
    http://www.ied.info/books/economic-democracy/multiplier

    Point#1: You own referenced article ended with the following quote. “Still, there’s no denying that for a small S.U.V. the fuel economy is

    great, which is actually the point.” And according to the EPA’s new fuel economy calculations:
    http://www.fueleconomy.gov/feg/hybrid_sbs.shtml it has the 5th highest rated hybrid on the market today. The only reason why it is “warmed-up

    leftovers.” on some level is because the refreshening is due next year. Then again the “2010 Ford Fusion HEV” with better fuel economy than

    Toyota Camry HEV by at least 6 mpg isn’t out yet….and I am sure we are getting really fair and balanced reviews by the press…

    Point#2: I’m sure you’ve informed your readers that Ford’s quality is now considered near or equal Toyota’s too…by multiple independent

    survey’s such as Consumer Reports and JD Power….right?!?!
    http://www.businessweek.com/autos/autobeat/archives/2008/04/fords_uphill_ba.html

    Point#3: I am sure you explained the public’s fault in buying preferences in all this as well as the Oil Price manipulation via derivatives

    causing the demand shift artificially faster than expected. Check out the old GM Metro and tell me why no one bought it too.

    http://www.stopoilspeculationnow.com/site/page/the_problem

    Consumer automotive buying preferences:
    1981: Fuel economy=43%, Dependability=32%, Price=14%, Quality=4%,Safety=9%

    1987: Fuel economy=4%, Dependability=44%, Price=31%, Quality=8%,Safety=14%

    1996: Fuel economy=7%, Dependability=35%, Price=11%, Quality=19%,Safety=29%

    2001: Fuel economy=11%, Dependability=30%, Price=8%, Quality=22%,Safety=30%

    *Source: Derived from US Office of Technology Policy (2003: 6).

  7. Point#4: I am sure in “reporting” Jetgate you not only listed the complete number of people on the plane with the CEOs, but also that the TCO

    for esp. companies like Ford that got deals on them years ago has made them cost effective from their primary use. Shuttling armies of

    engineers with their equipment down to assembly plants for new vehicle launches. Let alone that Nancy Pelosi herself ironically flew a huge

    private jet by herself to visit the Big 3 earlier, let alone the bunch of Senators and Congress members who’ve been doing that constantly.

    Point#5: RIF = Reading is Fundamental (even for lazy Journalists)
    Here’s Ford’s Plan…at least read the summary, but I doubt you can get through the 33 pages, but if you actually do and want to report

    something honest and true for once…I will answer some brief questions. You see I am one of those unknown engineers who been trying to save

    my company while the rest of you are just oblivious.

    http://media.ford.com/article_display.cfm?article_id=29505

    Point#6: Fair and Unbalanced. Money for nothing…at least if you are in banking or insurance! I have just been been nauseous for weeks as

    the misinformation and unfair attacks on the false Blob of the Big 3 has been an awesome cover for the $7.8 Trillion shovelled in 2008 to the

    to the banking and insurance industry so far…including $45B just for Citibank in the week after everyone just yelled that we should die…and

    that’s on top of the $25B given to them before for a total of $70B just for Citibank. Please explain the detailed analysis you’ve done of

    their finances or how it has helped the economy or what types of concessions AIG had at that retreat. Gimme a break.
    http://www.nytimes.com/imagepages/2008/11/26/business/20081126_FED_graph1.html

    Guess what…I highly doubt you even read this far…glad you are interested in energy and technology and apparently the media too. Guess

    what…you can do much better. Nothing has failed the American Public more then the lack of true Journalism as even online blogging gets lazy

    and get’s caught in the Chomski propaganda model. Please read “The Age of American Unreason” by Susan Jacoby…and then come back and decide

    to talk to experts and insiders rather copying and pasting the official story as Colbert indicated to the WH Press Corps.

    I leave you with a final thought…or at least for your readers with the necessary attention span…this video totally explains my frustration

    with you, the media and the average ignorant sheep like massess that apparently will buy a empty bullshit story from the banks and refuse to

    consider the facts in the US auto industry.

    Don’t get me wrong…sending the CEOs back was a good thing…esp. since GM and the UAW finally decided to start to help, but I have no shot at

    convincing the “San Francisco” crowd you no doubt hang with if a “fact-checker” like you seems to deal in neither. Copy, Paste & Post!!!

  8. Sorry…word wrap didn’t paste correctly…ironically. I can repost if you want. Fortunately I’m not a journalist;)

  9. The outrage against Detroit versus Wall Street is understandable. In the case of Wall Street, we are shoring up the nation’s ability to obtain any loans for business or consumer spending. All credit had disappeared. Banks were not lending. The bailout was to help the economy at large, not protect Wall Street jobs. Loss of credit had touched every business and every household in America.

    In the case of Detroit, access to all trucks and autos has not disappeared. They are still widely available from Toyota, Honda, BMW, etcetera. This is purely a Detroit “save-our-jobs” request. There is not the same universal impact on the rest of the economy as basic banking.

    The world can do without Detroit cars. The world cannot do without borrowing and credit. Detroit is in unfortunate straights. But scarce public monies must be reserved for those problems that have a more central & widespread impact.

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