Dodd speaks: Wagoner should move on

Posted by: David Welch on December 7, 2008

RIck.bmp

On CBS’ “Face the Nation” today, Senator Chris Dodd (D-Conn.) said that General Motors Chairman and CEO Rick Wagoner should “move on.” That could mean that Dodd and other members of Congress will ask for Wagoner’s resignation before voting on a loan package for GM and Chrysler next week.

In other words, Dodd could be setting up Wagoner as the scalp that Congress can show voters before inking this proposed $15 billion bridge loan for the carmakers. Well, that certainly tees up a question that has been burning for several years. Should Wagoner be fired? The problem with Dodd bringing this up is that Washington doesn’t really know anything about the auto industry. And we really don’t want politicians running car companies or anything else. Dodd isn’t qualified to make that decision. Nor is anyone else in Congress.

At the same time, Wagoner’s record is almost impossible to defend. Since he became CEO, the company blew money on things like a $1.3 billion stake in Subaru parent Fuji Heavy Industries, which yielded no cars or technology worth mentioning. He spent $2.4 billion to get into Fiat Auto and another $2 billion to get out. GM has also paid more than $4 billion in dividends. That’s almost $10 billion wasted. While squandering that money, GM borrowed some $18 billion to shore up its pension fund.

At the same time, Wagoner cut capital spending early in the decade while many product lines—except the trucks and suvs—went too long without a refresh. Brands like Saturn and even Chevrolet labored on with inadequate marketing budgets. Hybrids were stiff armed and the EV1 electric car was killed. Like his predecessor Jack Smith, he made sure he took care of shareholders while the company often lagged in product and technology.

To be fair, Wagoner was dealt a tough hand, perhaps tougher than any CEO in the country. He has raced to restructure the company since 2005, taking out tens of thousands of jobs and unwinding decades of blunders by his predecessors. But he wasted too much cash. And to say he didn’t transform GM is such an understatement that it seems silly to mention. As basic measures go, he has failed. The stock price that soared above $90 a share a decade ago is now below $5. Market share has fallen eight points to 20% since Wagoner became chairman in 2003. No top executive would keep his job after that.

With a record like that, it is time for him to move on. It will be difficult for GM to defend its Chairman if Congress wants him out. Perhaps give his No. 2, GM President and COO Fritz Henderson a shot. Maybe there is some outsider waiting to come in. Retired IBM savior Louis Gerstner recently came available.

But before firing Wagoner, I want to know the plan. Who will take over? It can’t just be his heir apparent, Henderson. The job is too big right now for one man to do it all. And if it’s an outsider, who will it be? For all the General Electric stars that Chrysler CEO Bob Nardelli has earned, he didn’t work miracles for Chrysler. Though Alan Mulally came from Boeing to Ford and has done well.

Yes, Wagoner should go. But not until the current crisis is passed or someone tells me who the new top dog will be. GM needs leadership right now. Canning Wagoner to show voters a scalp will only make matters worse, especially if there isn’t an experienced change agent waiting to take the toughest job in American business. It’s a big decision. America’s auto industry and, perhaps soon, billions in tax dollars will be riding on it. The call can’t be made lightly.

Reader Comments

Paul (Vw)

December 7, 2008 9:59 PM

I don't think congressman should be dictating who does or does not run a company (even if they get a bailout I disagree with). Myself I think the Detroit execs should voluntarily offer their resignation (as well as the head of the UAW). Let the company boards decide if they should remain or who is best able to implement a turnaround.

That being said, Gerstner would be an excellent choice. He came into IBM when it was on the ropes in the early 1990s. He had run Nabisco (crackers)...no high tech experience to speak of. Everyone was saying break IBM apart. He saw value in keeping it together and pulled a stunning turnaround. He's like 66 years old...still young enough to do it.

Rick Wright

December 7, 2008 11:35 PM

Dodd should be fired.

Sullivan

December 7, 2008 11:39 PM

If Wagoner should step down due to his role in GM's situation shouldn't Dodd step down as Chairman of the Senate Banking Committe since this crisis has happened on his watch. Is this the same Chris Dodd who received sweet heart terms from Country Wide? A classic piece of misdirection from our elected officials. Let's get everybody debating about the auto industry and maybe they'll forget about what the finance industry did to us.

Bernie Schwartz

December 7, 2008 11:56 PM

Dodd is the one who should move on. He's the chief fox in charge of the hen house. If he had spent less time schmoozing in Iowa and paying more attention to his own constituents maybe he could have SEEN THIS ALL COMING. As chairman of the house finance committee he is the one who's head should roll.

Ronald Webb

December 8, 2008 12:23 AM

When Wagoner goes, I would be willing to buy stock in GM again. This man is the most arrogant person I've listened to since I worked for Gereral Dynamics. To say he is the "best leader for GM"? What is he smoking? And listen up folks, I bought a "hybred" car from GM in 1981. They took a 350 engine & TRIED to convert it to deisel. It blew apart in 59,000 miles. Plus, I had to beg for a parking spot to plug it in during the winter & if it got below 15 degrees it wouldn't start anyway, plugged in or not. I wold plug it in & PUT A "trouble light next to the battery to get it ti start. It only took GM 12, yes count em, 12 years to make a settlement with me. This hybird thing is just a smoke screen. If you live in a warm climate year round it may be fine but, if you live in the nothwest, or midwest, it won't work. Batteries don't like cold weather. If people buy a hybred car they better buy 300 foot of extension cord too & hope for the best.
The auto industry has the technology to build more fuel efficient cars. A friend of the family bought a new 1968 Cornet that got 67 MPG (383 CI). When Chrystler found out about it during his 500 mile check up, they took the carburator off, gave him $500.00 & said it was "experimental". After that, he got 14 MPG, so don't tell me the technology isn't there.

JB

December 8, 2008 12:27 AM

I wonder if Senator Dodd would be willing to fire himself for the mortgage policies he foisted on the American people. I mean after all, if it hadn't of been for his dogged insistence on ensuring home loans to people who couldn't afford to pay them back, perhaps the economy and the Big 3 would be in better shape, and all these bailouts wouldn't be necessary.

texanrme

December 8, 2008 12:53 AM

Rick Wagoner cancelled the GM electric car program and demanded all vehicles returned immediately to GM. The real reason for cancellation of the program was they required no oil changes or routine maintennance of the internal combustion engine. Anyone can install a new electric motor, batteries, and all components in a vehicle for less than $8,000.00. GM wants how much????? Fire Wagoner and build your own electric car.

xyz

December 8, 2008 1:08 AM

Who cares about the CEO job! Break up GM and Chysler, and merge it with Ford. Sell the rest if GM and Chysler.

rgorsch

December 8, 2008 1:14 AM

Maybe Dodd and Rep. Barney Frank, the congressional architects of this disaster, should move on.

Michael Wagner

December 8, 2008 1:20 AM

Having worked in the automotive industry for a supplier to the Big 3, I believe that not only should the CEOs go, but the companies themselves should all go. They have survived for too long on greed, ill-founded pride, and gross inefficiency.

They are not too big to fail, and it is time we Americans realize that we do not need the Big 3 to keep our economy afloat.

Samir L Hanna

December 8, 2008 1:58 AM

I agree with what you said? But I wish it was said earlier before this outright mis-managemnt happened. The irony he was paid more than he deserve to do it!!
We have to re-visit the performance measurements through which CEO's are being compensated. Compensations should not be measured on financial results only.

Brian

December 8, 2008 2:15 AM

Since the US should be concerned about US jobs & not the survival of any particular company and since Ford appears to be the best managed company, why not consider giving Ford the money to buy GM & Chrysler. A single larger entity would have a much better chance of survival and the bailout would cost far less.

123xyz

December 8, 2008 2:35 AM

The whole GM Board and executive staff should be walked out the door. Incompetence mainly... secondly, excessive hubris. "Rainy day fund? We don't need no stinking rainy day fund!"

But, evil Cerberus' Chrysler unit should be allowed to die a long slow death. It wouldn't be surprising Chrysler is paying a Cerberus real estate arm jacked up lease prices for all their offices and plants. Hummm, they already did that with their Mervyn's department store chain... I would love to attend a Chrysler "Going Out of Business" sale and give Cerberus a dime on its dollar.

Bill

December 8, 2008 2:55 AM

I could not agree more and for one who has watched GM's floundering over the decades I guess the one saving grace we can let Wagoner take credit for "not really" is when they unloaded Directv.

Paul Duvane

December 8, 2008 3:06 AM

Let's make it a twosome on the gangplank and ask ole "Countrywide" Dobb to accept responsibility for his failures.

Tuluk Talae

December 8, 2008 3:07 AM

The biggest problem with Wagoner is his continued ignorance of the threats of climate change. Until the USA and world move away from carbon-burning personal transportation, there will be no real change, and Wagoner is a big impediment.

Fazal Majid

December 8, 2008 3:17 AM

Whether Congress knows anything about how to run a business is irrelevant, it's all about setting incentives. In olden days, a general who lost a war would fall on his sword. If CEOs begging for a bailout are made to resign (preferrably after forgoing bonuses and golden parachutes), fewer will line up to feed at the trough.

Matt Lechner

December 8, 2008 3:19 AM

The issues facing GM relate to the global economy, and weakened demand for cars and trucks. GM itself has been doing well operationally. The plain fact is GM today has the best line-up (and quality) of product, and best overall efficiency, since WW II. Mr. Wagoner may not be TV central casting's call for a 21st century CEO, but he has been doing a excellent job running General Motors. The bottom line is he does well for GM.

Matt Lechner - CFP, CRPS, CIMA, FRM
Chairman - WSSIG, the Wall Street Special Interest Group

donald buckley

December 8, 2008 4:21 AM

Rick Wagoner CEO GM, Alan Mulally CEO Ford, Bob Nardelli CEO Chrysler and most importantly a labor leader who was elected by the members of the UAW (a democracy) in a fair and unchallenged election President Ron Gettelfinger UAW. These are the best and the brightness in the room. Each a giant: google their names and you will be enlighten. Wonderful stories and the most challenging of assignments.
When I listen to Senator Shelby and Senator Corker from Tennessee I get so upset I have to shut the TV off.
I then turned it back on to see how they were handling it. President Gettelfinger showed disgust by body language and would choose not to comment and the the three CEO's answered each question as if it was ask with sincerity and in a positive manner. Cool under fire, focused and disciplined. Real leaders.
Wagoner has reduced the capacity, manpower and addressed legacy and wage issues in a meaningful way.

bonganisihele

December 8, 2008 4:59 AM

What plans do you have to empower the previous disadvantageous people bz my contract had been terminated at GMSA with unknown reason.

donald buckley

December 8, 2008 5:02 AM

As I recall when I was wounded in Viet-Nam and my sister believed I was dead for a few days. I was fighting and spilling blood at that moment in time to prevent a domino effect that would engulf all south east Asia and Japan. I saw a few South Koreans no Japanese, well let's just say all the heavy lifting was being carried by the 58000+ American soldiers that were KIA's. Now Shelby from Alabama and Corker from Tennessee are saying the Auto industry must get competitive. Rick Wagoner is a poor CEO. (not true) The legacy cost of health care and our pensions are to much of a burden. They openly praise and lobby for tax gifts and breaks and no legacy cost or union interference in the foreign auto companies they brought to their states at the detriment of UAW workers in Alabama and Tennessee.
What about German legacy cost? The cost of maintaining the Seventh Armor Corp in Europe. Providing stability for the last 67 continuous years but count world war One and many other acts of well being, such as the Marshall plan and so forth.
Rick wagoner just paid 110 billion in legacy cost. Where's Japan's and Germany's and let's not forget South Korea, or China's: Barchevsky's trade deal with China was the greatest economic boom for them since the Great Wall was built. When is their legacy cost money gonna be ponied up. The American worker bails out all these foreign companies pays their legacy cost provides their security even as we speak today our soldiers are paying in blood and Shelby and Corker taunt them on the floor of the US senate asking more of them and more for foreign automakers.

giorgiogavi

December 8, 2008 5:42 AM

That Wagoner must go after such a disaster was obvious years ago. Nothing happened but the solution is not to promote the number two of the same disaster.
The only solution is to entirely rethink what a personal transportation system vehicle nd its product ecology must be.
Once that is defined as well as what the public really needs , let' start again.
With the might of GM the result can only be positive.

m.r.

December 8, 2008 6:06 AM

GM execs should have been replaced a long time ago. hopefully they will get some real tech managers that will dispense with the "futurama" BS and start to run the company in the "real" world!
Chrysler execs need a forced exit, too.
Feds should buy shares at low valuation
at the expense of private owners.
there is something wrong with the Board regulations that exist today. also, Fund managers are not doing a good job, either.
if succession is done well, there is no reason that it wont succeed!

Hugo van Randwyck

December 8, 2008 6:39 AM

Split the job of CEO and Chairman into two roles - each role asks different questions. Also Chapter 11. Also new managers with overseas experience with fuel-efficient cars. Where is the sense of having a coach with experience of NFL footbal, with a losing streak, continuing, when the crowds want to see a winning soccer team?

bruce darr

December 8, 2008 6:46 AM

Dodd is so right. Any person in power who makes terrible business decisions, spends money frivolously, and basically runs an institution into the ground should without question step down. See you later Senator.

Carl Shay

December 8, 2008 6:54 AM

Let me get this straight. Dodd is the Chairman of the Senate Committee on Banking, Housing, and Urban Affairs which has presided over one of the largest banking and home mortgage crisis we have ever seen and he wants Wagoner to step down. What ego, what gaul. If I was Wagoner I would say "right after you buddy!, right after you". Dodd should follow his own logic and resign.

Andy

December 8, 2008 7:31 AM

"Yes, Wagoner should go. But not until the current crisis is passed"
Are you kidding? You mean he should stay on for another 5 years or so, and further wreck the company into complete annihilation? (which won't take 5 years).
He should have been fired long ago, as would any blue or white collar worker with a comparable (lack of) track record.

Stephen Griffith

December 8, 2008 7:39 AM

In addition to the senior executive, there should be a discussion relating to the Board's failures. Clearly, there is a failure of governance when a Board allows this type of incompetence to continue.

kimberly

December 8, 2008 8:25 AM

Why should anyone from the car business be forced out. Who was forced out within the banking industry. I am more mad about the banking bail-out. That was the first worm let out of the can. We should ask for the senator's resignation for first giving our money to failing banks.

Jeff B

December 8, 2008 8:26 AM

I am no fan of Wagoner, and I'd be happy to see him go, along with Nardelli at Chrysler. However, I wonder how many Americans realize how much bribe money (oh, excuse me, campaign donations) Sen Dodd & his buddies recieve from auto industry lobbyists and from the UAW? This is no better than Dick Cheney leading the charge for an energy policy. Se. Dodd's lax oversight of the financial industry (his commitee responsibility) is one reason we are in this mess now. The only people less qualified to run the auto industry are the idiots in Washington.

Don

December 8, 2008 8:38 AM

Jeff B. put it well. The American people should be calling for the resignation of Chris Dodd, Barney Frank. The wealth without work mentality led to the current state of affairs.

David

December 8, 2008 8:45 AM

If Dodd gets Wagoner removed because he "wasn't able to make tough decisions, etc" then what are they really saying? What they are saying is, "we need a tough sob who will break the UAW." They don't know that, they don't mean that, but that is really what they are saying. Can you imagine what will happen if they get that?

Aaron Layman

December 8, 2008 8:48 AM

Frank and Dodd are conducting a circus. Unfortunately it's politics as usual in Washington.
These Cogressmen need to go to business school. Are they really ignorant enough to believe that the auto companies' assets would just sit idle for years and everyone would remain out of work? Bankruptcy is clearly the best solution for the Big 3, and probably the only way to ensure their continued stand-alone viability. The only question is whether Congress is going to have the stomach to take the heat when a lot of people lose their jobs. Congress has blinked in this game of Chicken, and now they are trying to justify their waffling.
The Big 3 are not too big to fail, and the sooner Congress admits this the better off America will be. Cutting the head off the snake changes nothing. It's still a snake. These are greedy, poorly run corporations that have no regard for American prosperity and our future in general. Corporations by their very nature seek only to propagate their own existence and increase their profits.
Did anybody catch the piece on 60 minutes about Saudi Arabia? If we keep these 3 money-holes we are going to be back in the same situation 20 years from now. The only difference is that the price tag will be much higher, and our leverage will be significantly diminished.

Peter S.

December 8, 2008 8:55 AM

Well those who are still locked in idelogical dogma (""I dont think congress should determine who runs a company") - guess what: congress shouldnt be in the position of doing handouts to overpaid execs who destroy value in the first place.

If anything, congress is far too soft here and is just grandstanding. If Congress is going to get value for the American people out of these auto companies, what they really need to do is fire the entire upper management of these companies, guarantee the liabilities to suppliers and then turn arround and arrange a strategic sale of the remaining assets to companies like Honda and co, who actually know whow to run auto businesses. But handing more money to the same people who have for decades refused to invest in more fuel efficienct cars is just crimnal negligence.

pm69

December 8, 2008 9:29 AM

The whole GM top managent should go. The board of directors should be replaced as well.

skyhigh

December 8, 2008 9:34 AM

I for one am against the bail out and the government should let the car market fail. I have been in the industry as an executive since 1988 and we have ignored what is best for America to make money for the share holders. I have constantly been involved in decisions that will improve the end of the month outlook without regards for the long term future. I have watched the Japanese make decisions that hurt their immediate future for long term security. SO let them fail and restructure to develop a long term future.

GM Lady

December 8, 2008 9:41 AM

I'm for replacing Wagoner. 8 years and not enough progress. Hiring someone from outside would be a HUGE mistake. Whoever gets the job has to hit the ground running and FAST. Whoever gets the job should have a vested interest. But chosing someone from Wagoner's immediate staff is like picking clones of himself and that would be a big mistake. Who then? Pull GM VP Nick Reilly from Asia Pacific. Has the experience, has the respect and a proven record in turning volatile situations into success stories. Nick Reilly.

Robert Wilson

December 8, 2008 9:45 AM

Dodd is going to call for the resignation of an auto CEO who is asking for a loan that will paid back with interest while he doles out $700 Billion without so much as a hearing. What qualifies this man to make any sort of demands regarding who and how the business should be run - it is not their domain. The oversight board that GM has asked for should simply oversee that the company is doing with the mnoney what they committed to do, period. Congress has no qualification to call for any sort of business decisions.

LH

December 8, 2008 9:53 AM

It is most unfortunate that one man's opinion is given so much attention. The present CEO of GM has been with GM a number of years and has recently made some significant positive changes. The other CEO's of Ford and Chrysler are very recent appointments. Maybe that is Dodd's reasoning. I understand that the Board of GM. has given Wagonner their endorsement. Let's hope that the government with their academic approach to business does not interfere to the point of frustration to the business leaders!

Gary

December 8, 2008 9:57 AM

If this isn't typical of Congress. Though the auto industry is to blame for much of thier current problems, Congress is completely unqualified to dictate who should stay or who should go. The current Congress has sat by and allowed these industries to get to the point they are at, and now they are spending trillions, with no respectable oversight and with not a clue as to whether or not it will do any good. Here is my take, fire Congress!!

watercloset

December 8, 2008 10:19 AM

Get rid of all of those CEO's -- Chrysler, Ford, GM. Get rid of them from Goldman Sachs, AIG, etc. Garner their millions in salaries and feed these salaries back into the companies. I do not want my tax money to bail out these useless brigands. They drove their companies down to take billions for themselves, while the working guys get stiffed with it in the end. I do not want to bail out Chrysler, which is privately owned by a well-off investment firm, Cerebus. I do not want these guys to get my money so that they can shore up their portfolios.

No to the automobile bailout unless these corporate privateers go to jail first.

HogRider

December 8, 2008 10:23 AM

Nah... KEEP the GM guy, but put a $$$ leash on him (and the rest of them) to keep things in check. Instead, let's rewire Congress. Too much Lib Fat in that organization. Our country's going to hell in a pork-filled handbasket.

Hopefully, Mr. Hussein won't screw everything else up with his proposed tax hikes. If he does, then we're ALL screwed & bread lines loom in our future anyway, so who cares what Wagoner does?

Peter S.

December 8, 2008 10:24 AM

He who pays the piper calls the tune. If you are an industry so useless that do the wrong thing for decades - and end up in Washington DC cap in hand, well, if they keep you afload, you have nothing to say.

I am am sick and tired of America doling out corporate welfare left and right while spouting "capitalist" phoney lines.

If you dont want to see congress calling the shots, then fine - let then go find another source of funds, let alone one that wouldnt demand fundamental change.

By the way, its not clear either why any new leader has to be an "insider" or "has to hit the groudn running fast". Wagonner is both, has been there for 8 years and he is the one leading the beggars chorus right now.

What is neeeded is a fundamentally new approach to doing business. Not kneee jerk surface changes by one of the same people who has been fiddling while Rome burns!

Andrew

December 8, 2008 10:47 AM

If the Big Three are coming to D.C. to beg for money, then Congress will dictate the terms. The union is just as much as fault as the executives. There was one union idiot in San Francisco on the news saying "why should the union give concessions? Wall Street didn't give concessions?" It's that kind of stupid mentality and dumb business decisions that got them into trouble. Let them fail! Let the market sort it out. If you make bad decisions (both the companies and the union) you should go out of business. You don't see Toyota, Honda or BMW begging for money.

boynebound

December 8, 2008 10:49 AM

Mr.Dodd, can't bring myself to anything else but that, doesn't have a clue about the automobile industry, or business in general. I am and was thoroughly disgusted by the manner, type and misinformation presented by congress last week. Obviously, anyone associated with the Big 3 recognized that pontification is just the analogy to "we can't find our butts with both hands." Welcome to washington!

Sandy

December 8, 2008 10:53 AM

GM's share price was $64 when Rick Wagoner took over in 2001. Now it is less than $5 per share. Dodd is right. Wagoner should move on. Also, why did Rick Wagoner and his staff lobby against more fuel efficient standards during his entire career there. Does he not plan for future obstacles?

GJ

December 8, 2008 11:07 AM

Despite the high pressure automaker bid for doing a speedy deal, Congress appears to be steadfast in their resolve to work through facts and to build support for the creditworthiness of the automakers. Congress gets high marks for that.

Unfortunately I've heard precious little to date about Cerberus Capital Management, LLC. I'm certain not everyone even knows who Cerberus is. Many, many American taxpayers who are the true creditors in the deals being struck by Congress do not even know that Chrysler isn't a corporation. Noting for a moment as we should, that different legal business forms carry vastly different ways in which their owners accept and avoid risk and responsibilities for repayment of loans. There are serious implications here well beyond the legal fundamentals of various business forms. But the fact that taxpayers are not aware of the Limited Partnership status of Chrysler or the Limited Liability Company status of it's major owner Cerberus is cause for great concern.

Aside from understanding the broader economic impact of a decision to lend to the U.S. auto industry, we must assess the deals being struck on sound financing principles exactly as a banker would. Obviously we must understand the risks of default by the creditors, but primarily and thus far too little mentioned, we must also understand who the creditors really are. Chrysler is not a corporation. Cerberus Capital Management is not a corporation. These entities are not by nature transparent and they have legal structures that, by nature, circumvent direct liability of their owners. The very individuals who stand to benefit, and will carry the greatest decision-making burden to make these deals worthwhile, may have the least risk to bear.

I can imagine a scenerio whereby the loan to Chrysler doesn't transform the automaker while the economy and the industry continue to struggle. The Chair and CEO of Chrysler eventually see no way out. Cerberus agrees that CEO Nardelli has not been successful in his efforts. They come back to the American people for more. By now the situation has even weightier implications to America, because the economy is still not improved and the industry has not improved and the taxpayer is on the lamb having already sunken money into these firms. Maybe we approve more money and pray. In the end, Chrysler fails. In light of the firms poor history, failure seems very possible. But when Bob Nardelli leaves his post he simply moves on. When Cerberus sell it's stake in this mess, they simply move on. When the company is split up and sold into its component parts, the unit executives move on and who suffers the knockout punch? We know it will be the line worker and in turn the American economy and finally, as ever, the American taxpayer.

Accountability must be absolute and certain accountability without special exceptions embodied in the fancy business forms we're dealing with. As bankers, the American taxpayer should understand exactly who they're lending to.

kimberly

December 8, 2008 11:16 AM

Why is Washington making decisions about business practice? Since when are they supposed to decide what businesses fail and which ones should succeed? Washington get out of the bussness of managing individual companies and get back into the business of governing the US.

valiantdefender

December 8, 2008 11:47 AM

Dodd and Frank should not only move on, they should be tried in court for fraud and TOTAL incompetence.

dean

December 8, 2008 11:50 AM

Senator Chris Dodd should not be calling for anyone to resign except for himself. He seems to forget that under his oversight, Fannie Mae and Freddie Mac imploded and started this meltdown.

Should Wagoner go? Yes he has failed the shareholders of GM.

Joe B.

December 8, 2008 12:09 PM

Get rid of the CEO and the board. The contract with the UAW needs to be destoyed as well. The company needs to be competitive with Toyota, BMW, and Honda factories in Kentucky and Alabama.

John Miles

December 8, 2008 12:21 PM

I don't believe anyone truly understands how large GM really is, particularly Mr. Dodd. This is not an American business but a world-wide business. Getting a handle on it is a major issue.
How many planes does Citi Bank have? No one asked that question, and they got money!!!

Ron B

December 8, 2008 12:52 PM

Who does this jerk think he is?
He is one of the worst at screwing up Fannie Mae and Freddy Mack and then he looks down his nose at these CEO'S!
How about they start at home with what it cost the tax payers for the use of the jet Queen Nancy uses!

Jack Norris

December 8, 2008 1:52 PM

If someone takes on Wagoner's job, he is certifiable and a moron to boot. It's a text book "no win" situation. Take Dodd's mirror away from him before he hurts himself.

Kim

December 8, 2008 2:03 PM

My generation is NEVER going to buy from GM or Chrysler, nor will the generations just ahead of us or behind us. (I'm 27) Giving them money is a waste and an insult. The companies are not worthy of salvaging. When a company fails, it FAILS. Then again, I think a large portion of the government is too far gone to repair and should be completely overhauled, but that's a different topic.

Chuck C

December 8, 2008 2:28 PM

They all need to go!! Congress let the economy die and the CEO's are idiots

1574

December 8, 2008 3:15 PM

Have Rick work for $1 a year. To let him go now would be too easy on him. The committee hearings were not based on facts, but emotion. Emotions rooted in the failure of Dodd, Frank and the rest of them to provide effective oversight. Emotions based on the failure to hold the financial firms accountable. Furthermore....Senator Shelby should be taken out and flogged for his hypocrisy. When will the foreign car companies pay back all the incentives they received to establish a plant in his state? Never. Ever.

Carla

December 8, 2008 4:11 PM

Talk about cojones of steel. Congress bears some of the blame for the state of Detroit, for forcing environmental production standards on them without any understanding of marketplace response (or lack thereof). But of course, no one can point this out when they're hands are out begging for money.

Beyond that, the Democrats' hypocrisy is more than amusing - I think it hurts their credibility, and who in America truly believes that the UAW or the Big 3 will actually re-structure themselves into viable businesses, especially now that the government is going to get their hands in. The Democrats who are doing Obama/Emmanuel's bidding are piling up in these hearings, to wit:

1. Schumer says he doesn't trust the Big 3 to re-organize, or operate as they should. LAYING GROUND for the Auto Czar, an outside government appointee who will try to turn these businesses around while obliging the new administration's anti-business mandates.

2. Democrat house member admonishing the panel for NOT saying that National Health Care would virtually solve their financial crisis - LAYING GROUND FOR Universal health care, an initiative that was defeated repeatedly in prior administrations, and for good reason.

3. Chris Dodd pontificating that if Detroit gets the money, they have to make cars that people "actually want to buy". How they will do this remained unanswered.

Bottom line, all the hearings are a reflection of Rahm Emmanuel's statement made on Meet the Press in November, that you should never let a crisis go to waste - (sic) it's a chance to ram legislation down the throats of frightened people that would never get done otherwise. Everything is being orchestrated at the Obama level - hence, Obama's weekend radio address announcing that the job loss levels "will only get worse for a long time" - when in fact, all the analysts of historical recessions are saying that when the job loss number gets as bad as it did in November, the bottom is near.

Be afraid, America.
Be very afraid.

Mark

December 8, 2008 7:13 PM

Those congressmen and women don't know what they are talking about when it comes to the auto industry, and I certainly don't think they are really considering what's best for the taxpayers of this country.

Maybe Senator Dodd would like to run GM himself.

And those Senator's from states with Japanese auto transplants only want to see Big three fail so more business can come to their states.

Paul Rizza

December 9, 2008 7:56 AM

Senator Dodd is a grandstanding hypocrite. He is calling for Wagner to resign when he should resign for his part in the financial crisis that is affecting our country and the world! His committee is supposed to regulate the financial industry and they were incompetent and negligent in their duties. Then they provide that same greedy industry with $700 billion in free money that has done nothing to correct the crisis we are in. Look at whatr bank of America did with the money provided them. NOTHING! An they then cut off their line of credit to their costomers. What a disgrace to his public office!

randy

December 9, 2008 8:10 AM

Talk about the "pot calling the kettle black!" Dodd says Wagoner should resign. Holy mackerel! This guy and his congressmen cronies literally wrecked a global economy with their ridiculous decisions to pressure mortgage lenders to simply loan money to unqualified buyers and they have the nerve to call for someone's resignation??!! Talk about completely out of touch with reality and grossly arrogant. When will the American public realize that these are the representatives responsible for the mess we're in today and start holding them accountable for their mess. What a bunch of clueless constituents Americans have become!

Vince

December 9, 2008 10:53 AM

Let's see if Senator Dodd would be willing to work for a buck. That would help us taxpayers. Let's see . . . If GM gets rid of Wagoner, they would have to give him a severance package. GM would hire a new CEO who would require time to evaluate the company and make decisions. A new CEO would probably want a decent salary, not $1. Hmmmmmm . . . At least Mr. Dodd is consistant. His evaluations and decisions are terrible.

JMVG

December 9, 2008 1:53 PM

Consumers have shifted their preferences dramatically in a very short period and this may blur the vision of any CEO of a large company. However, seeing that three (to mention Detroit's three) boards and three CEOs have been so blind to wake up these days and a) notice consumers want different cars whereas some other foreign manufacturers have foreseen these for years, b) realize foreign car companies have run differently their companies, and c) energy has been a central role for European cars for years, all this make me think US Car companies should be run totally different and from different minds. Politicians could opine but the reality is bigger.

Paul

December 9, 2008 3:05 PM

While I disagree with Senator Dodd on Rick Wagoner, at least Dodd and the Democrats are trying to find a way to keep GM alive. In stark contrast, GOP Senators McConnell, Shelby, and Corker are licking their chops at the prospect of the Detroit Three going under and hundreds of thousands of UAW workers and retirees in "blue states" losing their jobs, health care and hard-earned pensions. And, yes, I mean "hard-earned" - ever work 30-40 years on an assembly line or in a foundry?

When New Orleans, Biloxi, and Gulfport were devastated by Katrina a few years ago, the entire country came to their aid, and rightly so, with tax dollars, donations to charities, and in many cases volunteer work. Now, it sickens me that so many people - yeah, I'm talking about you, Sen. Shelby - are now willing, even eager, to see towns like Detroit, Lordstown, Ohio; Bowling Green, Kentucky; Shreveport, La.; and many others economically devastated.

As Moody's economist Mark Zandi said at the House Financial Services Committee hearing last week, the impact of GM going under would be "cataclysmic" for the U.S economy. Not annoying, not irksome, not mildly troubling - but cataclysmic. Time is running short; it's time for Shelby, Corker and McConnell to stop grandstanding and help prevent sending our economy into a depression.

Steve

December 9, 2008 5:31 PM

Dodd and Frank are right. People in power who make terrible business decisions, do not understand thier business, spend money poorly to advance the business, and run their institution into the ground should without question step down. Could reasons for the Senator and congressman to step down. Washington clearly does not understand the business, what changes have been in the works over the past few years or how the mess came about (or does not want you to). No long term energy policy, customers voting with their dollars for large and powerful vehicles created a potion of this. The largest issue I have is the lack of accountability the finacial group is held to and oversight that contributed to the disaster... Dodd, Frank and many other congressmen. Oh by the way, Sen. Shelby's state gave billions to the transplants to "invest" in his state.

RMA

December 14, 2008 3:53 PM

And don't forget to give the CEO's, top management, board members and UAW leaders a brown box when they are fired.....and bring in security to escort them to the door.....

flyerbry

December 22, 2008 7:41 PM

It's the Democratic party that gave us Fannie Mae and Freddie Mac then took handouts from both of them while pushing them to give loans to anyone with a pulse. Remember when Clinton was running for office and one of his big goals was for everyone to be able to own their own home? There are plenty of republicans that were asleep at the wheel too. Ironically the chronically asleep at the wheel Bush administration tried to crack down on the bad loans but the Democrats blocked them. The way I see it the politicians have ruined our econemy so for one of them to call for the resignation of a CEO from one of the companies feeling the hurt from their actions is a complete farse. GM was on a real turn-around before the financial crisis. Now even Toyota has reported a loss for the year!

Post a comment

 

About

Want the straight scoop on the auto industry? Our man in Detroit David Welch, brings keen observations and provocative perspective on the auto business.

BW Mall - Sponsored Links

Buy a link now!