In 2001, at age 69, Bob Lutz was invited to join General Motors as vice-chairman of product development. During the next nine years (Lutz left GM in 2009), Lutz helped redirect General Motors to develop cars that American consumers would want to buy again. In Car Guys vs. Bean Counters, Lutz tells the story of that journey.
Bob Lutz previously was the vice-chairman of Chrysler, executive vice president at Ford Motor Company and executive vice president in charge of sales for BMW. Lutz is an individual like Steve Jobs who has a sense of products that consumers will like. Lutz gives the insights and opinions of an "insider" of an American automobile company during this period of time.
When Lutz joined the company, General Motors's image was of a stodgy company with boring products, not a market leader. He definitely helped to revitalize the company's product line. In order to accomplish this, Lutz had to overcome the bureaucratic structure of General Motors and return product design to design engineers instead of marketing and accounting people. General Motors routinely buys its competitors' cars and studies them to assure that it is developing cars with competitive style, fit and finish, and performance.
Lutz believes the American press is prejudiced against American manufacturers and colors almost all stories about the company in a negative light, while favoring foreign manufacturers, especially Toyota. He also believes the issue of global warming has been exaggerated and the contribution of automobiles to it is small.
The Asian manufacturers started with a big competitive advantage over American companies because they didn't have to fund past service pension and health care costs for retired employees and avoided having unions. To avoid a strike in 1990, General Motors led the other American manufacturers in accepting a major expansion of health care benefits for both active and retired union employees. The only way to eliminate this burden was to go through bankruptcy.
General Motors also included subsidiary companies like GMAC, its financing arm, that contributed to its financial difficulties leading to its bankruptcy and restructuring.
Although portrayed as technologically lagging, General Motors has been a leader in developing hydrogen technology for vehicles and the plug in electric Chevrolet Volt.
The fact is the most profitable product lines for General Motors are trucks, including sport utility vehicles. SUVs have become the American family car. General Motors has always been a leader in these vehicles, but these lines took the hardest hit from the economic downturn in 2008.
To understand the challenges of operating a traditional American manufacturing company, Car Guys vs. Bean Counters is well worth studying.
Purchase it on Amazon: Car Guys vs. Bean Counters: The Battle for the Soul of American Business.
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