New 2010 Cadillac CTS Coupe - The last of the good ones from GM?

So, the Obama administration has decided they no longer like having Rick Waggoner as CEO of GM, so he should resign. It’s somewhat reminiscent of the mob “suggesting” that the local shop owner should pay them insurance money because the world is a dangerous place. Now the Obama administration can step in and tell a company that the administration knows more about their business than the company’s board of directors does, so they should be the ones to decide who leads and who doesn’t.

Where does this stop? Will any number of companies have to seek the administration’s approval before appointing people to management roles. What criteria will the government use to decide who is worthy to run a company and who is not? Will one of the primary criteria be who is more likely to toe the administration line on policy and procedure? A frightening thought, that. It points to the reason why taking federal money is a dangerous gamble, with plenty of strings, and no guarantee of success.

Precisely how much does the Obama administration know about running a large motor vehicle producer? As one of the major supporters of the administration are the Nation’s unions, it raises the question weather or not Rick Waggoner’s decision to renegotiate GM’s union contracts in 2007 played any role in the administration’s decision. In fact, GM probably should have declared Bankruptcy long ago so they could have gotten out from under the parasitic agreements that greatly contributed to their downfall.

What role has Waggoner played in the decline in the General’s fortunes? Why precisely does he deserve to be removed as leader of one of our nation’s greatest companies? He has been criticized auto industry insiders and analysts for being hesitant to close plants and streamline the company in an effort to restore profitability in the face of declining sales.

Many have condemned him for relying on large trucks and SUVs as a main profit center for GM, such that when fuel prices rose dramatically last year the company was left with expensive, unsold inventory. Many of these same people and others really feel that the average citizen has no place piloting such mammoth vehicles. They are concerned that that such modes of transportation consume far more that their fair share of resources. However that is determined….

The consensus from many environmentalists, those in the administration, and others is that GM brought about their own demise by relying too heavily on such large vehicles. When gas prices rose, they got a well deserved whacking about the knees.

The ironic thing is that GM has been losing money and the aforementioned large vehicle sales were actually making a handsome profit for the firm. Should they have stopped production of such vehicles, only to see their revenues and profits decline even further? That probably would not have been a sound business strategy. I can see it now..”Well, product line ‘A’ is making us the majority of our profit, but some people don’t like it, so we should probably shut down production.” “But Jack, the customers love them, and they keep buying them.” Yes, but that’s not really important right now, is it.”

It wasn’t like some people would have you believe. GM was not like a drug peddler at a junior high school. They didn’t force these vehicles on consumers. No, they built them in response to consumer demand. They couldn’t just their product mix change at a whim when fuel prices rose 35% in a year. Consumer demands can change much more quickly than the products they want to buy.

For those of you unfamiliar with product development cycles in the automotive business, they typically take many years. Motor vehicles are complex pieces of machinery, subject to any number of regulations and customer demands. You can’t just slap them together in a few months in response to any market condition that happens by.

Waggoner has done more than any GM CEO in recent times to reverse the General’s problem of just plain producing generally inferior products over the past 30 years. That’s right, for the most part, GM made crap with 4 wheels. There were exceptions, such as their pick up trucks, but mainly there was quite a bit of garbage rolling off the assembly lines.

Waggoner has, in great measure, changed that. Since the beginning of the millennium there have been some nice, even world class machinery leaving the lines at GM. Cadillac has seen a resurgence, releasing the redesigned and highly regarded CTS last year. This mid-sized luxury sedan has been favorably compared with the best from BMW, Lexus and Mercedes. GM’s trucks are better than ever. The Corvette provides world beating performance and handling for a fraction of the cost of other sports cars. The new Chevy Malibu looks good, has a nice interior, and gets over 30mpg on the highway, while holding 5 passengers in relative comfort.

Something else; wonder of wonders, GM finally learned how to design a nice interior and cockpit. No more ugly interiors in American autos. The new truck and Cadillac interiors are fantastic. The Chevy Malibu is a great place to spend time behind the wheel, and the Corvette finally lost the diso, video game look to something more like you’d find inside a real sports car.

The new Chevy Traverse and GMC Acadia is an attractive, large SUV for those who don’t need to tow heavy loads. It returns the best fuel economy in it’s class while seating 8 with a decent amount of room.

It’s not to say that every vehicle GM produces is fantastic. But it’s too bad just as they are finally producing some great vehicles again, they may be led around by the administration like a dog on a chain. They’ll be able to dictate who leads, how they do their marketing, where they have their corporate retreats, how they travel, and which vehicles they produce. That doesn’t sound like a recipe for success. It sounds like a 5-year plan in the Soviet Union, circa 1935.

If this is any indication, industries will be led by those who know nothing about them, have never run a business before, and beholden to any number of interests besides the share holders and employees. If the share holders and board of directors decide that Waggoner has been doing a rotten job and want him fired, that’s fine, kick him out post haste. However, the leadership of the country should not also be the leadership of our major (and possibly minor) businesses.

In this case, they’re probably booting out the wrong guy. He’s actually done a decent job and whoever they appoint to replace him may not do nearly as well. If the government can lead him around like a bull with a ring through his nose, they’ll probably be much happier.

Maybe those in Congress should hold themselves to the same standard. Wouldn’t that be a change. When congress has a 10% approval rating, as they did a few months ago, perhaps they should resign. Chris Dodd, (D-CN) indicated that it was time for Waggoner to move on. Maybe Dodd should take his own advice. At least maybe he could help all of us get a better mortgage interest rate. Are the likes of Dodd who we want at the helm of or businesses or our nation?

As a condition of grazing at the public trough, Congress will be appointing a “Car Czar” to oversee the U.S. auto industry. As with many projects undertaken by Congress, there is a great chance the effort will be misguided and the execution flawed.

Will the incoming Czar know anything about the auto industry they’ll be entrusted to repair? Given they’ll have the reported authority to veto any expenses over $25 million, they will effectively control what vehicles the automakers will produce in the future. In this day and age, it’s pretty difficult to launch any vehicle development program for less than $25 million.

Performance vehicles don’t really fit well with the targets of the administration to reduce “man-made global climate change”. The fact that tens of thousands of climatologists, physicists, and other qualified scientists still say there is no clear indication that climate change is man made seems to play no part in the decision. See this for more information on the debate, and yes, it’s still far from closed, despite what so many would have you believe.

The incoming Obama administration is reportedly mulling over creating an entirely new Federal bureaucracy, dealing directly with climate change and energy policy. The Car Czar will no doubt be in constant communication with this new federal agency (if it ever comes to pass), the EPA, and the Energy Department to ensure the newly designed vehicles don’t step out of line.

Will all of this collaboration and oversight produce vehicles that people actually want to buy? Are performance vehicles even profitable for the automakers to produce in the first place? Because a high performance vehicle by its’ very nature is going to use more resources that one that gives tepid performance.

Or is it? Actually, this could force our automakers to start producing high performance vehicles that are much more “green” than their predecessors. It’s all in how they’re designed. One thing about electric vehicles is that they tend to develop prodigious torque at a very low RPM; 0 RPM to be precise. It’s due to the way electric motors function.

Since the majority of driving in American cities includes a large amount of stop and go situations, this gives electric and hybrid powered vehicles ample time to put their low RPM torque characteristics to good use. What if the high performance vehicle of the future is a diesel-electric hybrid? It’s recently been proven by Audi and Peugeot that diesels don’t have to be slow. In fact, they can be fairly fleet of foot. Audi has used their V-10 TDI power plant to great effect at LeMans.

BMW has just introduced a new, diesel powered 3 series, the 335d. It gives about 35mpg on the highway and can do a 0-60 sprint in 6.1 seconds. Combine a small, turbo diesel that uses modern high pressure injection and fuel management electronics, (like the new BMW) and a high efficiency electric motor(s) and you could be talking real performance with a minimum of environmental impact.

Toyota has been talking about reintroducing the Supra with a V-6 gas / electric hybrid power train. It would definitely be performance oriented, but give decent gas mileage.

Of course there will always be those that contest the need for anything high performance on the grounds that standard performance is all anyone really needs. Take that mindset to extremes and you’ll be walking or taking the bus to work. After all, does anyone really “need” personal transportation?

With new CAFÉ standards, an incoming environmentally friendly administration, and a possible governmental bailout then control of the automotive industry looming, are drivers witnessing the swan song of the performance automobile? Will there ever be another Cadillac CTS-V, Corvette ZR1, Porsche Turbo, or even Charger SRT-8?

Are we to behold a drab and boring future, devoid of automotive excitement? Is it the ‘80’s all over again? Remember the frighteningly tepid vehicles, with dubious quality, and lackluster design we were forced to endure in the dark days of the automobile? Does anyone not see how producing such vehicles pushed the Detroit automakers over a precipice from which they never extricated themselves?

If a “Car Czar” again forces our automakers to produce such rolling trash heaps, we may as well just shut the doors now. Maybe then the UAW would give some union concessions. By the way, how can I get paid $35 an hour to play cards?