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If President-elect Obama is serious about bailing out Detroit and also serious about his campaign goal of putting 1 million domestically produced plug-in electric hybrids on the road by 2015, execs like Bob Lutz, GM’s vice chairman, have no place in tomorrow’s Detroit — at least that’s a growing sentiment in the media; a recent spate of editorials and columns have called for salary freezes and firings. Lutz is the one who earlier this year said hybrids “make no economic sense.” He also told Stephen Colbert, while promoting the Chevy Volt, that he doesn’t believe in what he refers to as the “CO2 theory” of climate change.
The Wall Street Journal asked early on if an auto bailout package should boot the CEOs of Ford, GM and Chrysler just as the government ousted top executives at Fannie Mae, Freddie Mac and American International Group (AIG) as part of its takeover.
Speaking in May to the Detroit Economic Club, Obama did not mince words when it came to telling auto execs what their role was in their own downfall:
“Whenever an attempt was made to raise our fuel efficiency standards the auto companies would lobby against it, spending millions to prevent the very reform that could have saved their industry. Even as they shed thousands of jobs and billions in profits over the last few years, they’ve continued to reward failure, in some cases with lucrative bonuses for CEOs.”
Thomas Friedman was far less forgiving in his latest column, calling most of the “brain dead” auto industry’s woes self-inflicted and scoffing at the idea of subsidizing innovation in Detroit. He would rather have the likes of Steve Jobs take the reins of domestic auto sector. Sure, Jobs has built his company on innovation, but perhaps someone more like Better Place’s Shai Agassi, of whom Friedman is already a fan.
The auto execs are preparing to testify before Congress next week, but perhaps they should also be updating their resumes.