By David Welch April 29 (Bloomberg BusinessWeek) -- The 15 General Motors dealers who flew to Detroit last September for a dinner with GM management were not an easily rattled bunch. They had endured the worst auto sales slide in 25 years, as well as the bankruptcy of the iconic carmaker on which they had built their businesses. Only three months had passed since GM accepted a $50 billion federal bailout, announcing the retirement of four of its eight brands and the shutting down of 1,900 dealers—a third of its domestic retail network. These dealers were the survivors, some of the more prosperous people in their towns, and they wanted a little reassurance. CEO Fritz Henderson gathered the group in a private conference room at the Westin Detroit Metro Airport and tried to demonstrate that he had a plan, according to an executive in the room who asked not to be named because he was not authorized to describe the dinner. Henderson announced that GM was going on the
U.S. labor isn’t working, to borrow Margaret Thatcher’s slogan, and many investors are bracing for a double-dip recession. With about one out of every six American workers unemployed or underemployed, what to do?
When General Motors Co. announced plans in June 2008 to build the Chevrolet Volt plug-in hybrid, executives called it a “moon shot” intended to rocket past Toyota Motor Corp. in technology leadership. Now the car is a flash-point for concern.
“I am told I cannot talk about industrial policy in polite American company,” Dow Chemical Co. Chief Executive Officer Andrew Liveris told a business audience last March. “I’m not sure why, since the world’s two strongest economies, Germany and Japan, both have such policies.”
When General Motors Co. decided to make a plug-in hybrid, there was lively discussion behind closed doors whether the first model should be a Chevrolet or a Cadillac. The Chevy arguments won out and the Volt was born.
So who really lost Detroit? Why did the U.S. auto industry’s domestic market share decline from 71.1 percent in 1998 to 44.8 percent in 2009? Why does the U.S. now produce fewer cars than China? And what does this story tell us about the overall causes of decline in American manufacturing?
Pity the Chevy Volt. Ever since it became known that the plug-in hybrid car’s batteries had burst into flames after government crash tests, the Volt has become the whipping boy of Republican politicians.
Cadillac, General Motors Co. ’s luxury brand, is studying seven new model concepts to lure new buyers and build on the fastest sales growth among premium carmakers, two people familiar with the plans said.