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You’ll Never Believe Who Responded to Our “Warning Column” on GM

42 | By Michael A. Robinson

“The [company] doth protest too much, methinks.”
Hamlet (1602)


Our warning column on General Motors Co. (NYSE: GM) in Tuesday’s Strategic Tech Investor really seemed to resonate with you folks.

It generated a lot of emotion, elicited some personal experiences from you folks and even a few suggestions that we recommend “shorting” the stock.

But it wasn’t just our subscribers who responded to that analysis.

We also received a very strong response from GM itself.

On Their “Radar”

In Tuesday’s column – Why GM’s Recalls Are Worse Than You Think – I argued that I just don’t buy into Wall Street‘s talk of a turnaround at the once-great U.S. automaker.

I cautioned STI subscribers to not view GM’s current recall problems as a “buying opportunity.” In fact, I explained why it would be a bad decision to add the company’s stock to your portfolio right now.

Indeed, I said you should just avoid GM altogether.

It hurt to write that. As a consumer, I’ve been a GM guy for as long as I can recall.

My family, too.

My concern, I said, was that GM still doesn’t have all its problems under control.

As I told you:

New CEO Mary Barra, who took the job in January, recently fired 15 employees and disciplined five others involved in the faulty switches.

But GM as a whole seems to be in a state of denial about how extensive its problems really are – and I just don’t think Barra has a firm grasp on quality control at her company yet.

She’s talking tough and making quick moves, but Barra is facing, as she put it herself just last month, “a history of failures” for which “nobody took responsibility.”

Some GM officials knew of these problems and covered them up for years.

Just one day after my column appeared, Tom Henderson, manager of global financial communications at GM, posted a lengthy response. We’re reproducing the entire comment here.

While we can debate the merits of investing in our company – and we think there are many – I’ll leave that for the markets to determine.

More importantly and at the heart of Mr. Robinson’s blog is the question of whether GM is operating differently today. Our short answer is “yes” – we are putting the customer at the center of all we do.

For example, our approach to safety today can be seen by the aggressive actions we’ve taken to recall vehicles this year as a result of an exhaustive review coming out of the ignition switch recall. If we see an issue that could compromise the safety of our customers we will act swiftly.

And, we’ll do this while also building some of the highest quality vehicles in the market. In fact, GM had the most segment winners for the second year in a row in the 2014 J.D. Power Initial Quality Study. We also had the most segment winners in the 2014 J.D. Power Vehicle Dependability Study.

While we’re proud of these vehicles, we know we can continue improving and we will. Whether its safety, quality, design or value, we’re working every day to put our customers first.

As someone who’s spent three decades dealing with public companies – meaning I’m aware of all the politics and corporate bureaucracy that simmers just below the surface – I can attest to the fact that this is a pretty remarkable response.

Most of the time, companies ignore analyses like the one we published for you earlier this week. And If I went to them afterward for a response, the only one I’d likely get is “no comment.”

That’s part of the reason that I give Henderson a lot of credit for posting this response. Clearly, the gentleman from GM put a lot of thought into these comments as he penned them. And what’s written here was clearly written by someone with a passion for his job – and for the company. He was doing more than just spouting the corporate line. And kudos to him for that.

That said, I still believe this is a deeply troubled company.

For instance, while I was aware of the J.D. Powers results on initial build quality, I intentionally didn’t use them. The reason: So many of GM’s recalls are for newer vehicles, meaning they may pass the first test only to have the “faults” show up sometime later.

But GM’s problems go deeper than the assembly line… or even the engineering “drawing boards.”

That’s because the company’s real problem is its flawed corporate culture. That will take time to change… and even longer to fix.

Indeed, changing a corporate culture – especially with a firm as massive as GM – is one of the most daunting challenges a CEO will ever face.

Comparatively speaking, finances are easy to fix. You cut waste, make over the product line or lines, and perhaps even slash jobs.

But changing the culture – to keep the company from repeating its same mistakes over and over again – means you have to change the way your workers think. You have to excise their suspicions, break down the interdepartmental barriers that create “functional fiefdoms,” and give decision-making responsibility to employees far down in the organization. (And with that responsibility comes a more intense accountability, too.)

As I’m sure you can see, none of that is simple.

And that’s on top of old problems that just won’t go away.

In fact, the day after my warning column was published, Money Map Press Executive Editor Bill Patalon – a colleague I work very closely with – called to tell me he’d just seen a news segment telling viewers how GM was resisting a recall on trucks and SUVs in “snow country.” According to the news report, there have been a fairly extensive number of cases in which the brake lines on those trucks simply rusted through.

If GM were smart, it would just recall the vehicles, fix those problems and move on. The cost of those fixes would be miniscule compared to the recall costs the company is already incurring.

In late June, GM increased its projected second-quarter recall costs from $700 million to $1.2 billion. That’s in addition to the $1.3 billion hit it took in the first quarter, and it boosted its total expected recall costs to $2.5 billion – or about 66% of its corporate earnings for 2013.

By refusing to recall these additional vehicles, GM has yet again bolstered the image of a company that refuses to be accountable.

Contrast that with Subaru, which a week or so ago said it was recalling about 660,000 U.S. vehicles – for the very same reason. The Japanese carmaker told investigators it was concerned the brake lines “could perforate after exposure to seven or more winter seasons.”

Subaru took action without being forced to by federal regulators. And it’s not faced with GM’s recall disaster.

All of this tells me that – despite its assertions to the contrary – GM really hasn’t changed yet… and perhaps never will.

(Although I would welcome the opportunity to interview CEO Barra on her turnaround initiatives and would publish the Q&A here for all of you to read.)

A Final Note

The GM response was interesting – as it related to our column. And it was intriguing in another way, too.

As Patalon, my friend and colleague, observed, the fact that GM took the time to respond to the STI column says this newsletter is gaining a national stature. That means nothing to me from an ego standpoint. But it does mean something from a credibility standpoint, Bill explained.

“What this tells me, Michael, is that your analyses and recommendations are being watched by an audience that’s growing in both size and wealth,” he said. “It means that an ever-increasing number of corporate and institutional players are reading what you write… and are taking your views very, very seriously.”

I suspect that Bill is right. But we created this service to attack one specific issue – the sad and scary fact that more than half of U.S. households have almost no savings. We said that technology stocks were the way to overcome that savings deficit. And we developed the five rules for creating tech-investing wealth to help find the best profit opportunities … and hopefully to help make you all more successful investors.

The bottom line is that I’m not here looking for fame. But I am looking for fortune – a fortune for you.

Have a great weekend.

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42 Responses to You’ll Never Believe Who Responded to Our “Warning Column” on GM

  1. Robert W Cook says:

    I was amazed when Fox news had spotted GM workers drinking alcohol and smoking pot on their lunch hour!! Maybe they need to look closer inside their rank and file workers.

    • GEORGE COOKE says:

      G M PROBLEM

      If you remember its was / is Called GOVERNMENT MOTORS

      What business does the Gov’t do well

      Post Office NO

      G C

    • Doris says:

      Faux Snooze is old news. They didn’t have to go looking, and you are ignorant to be surprised. Zacko’s Bar was adjacent to the Janesville plant. “A little bit of heaven at the gates of hell”. The GM parking lot surrounded them on all four sides.

  2. Dale Kincaid says:

    Did I miss something. I thought I heard that Ms. Barra became CEO after having been the head of Engineering. If that were true, wouldn’t the head of Engineering know about ignition problems?

  3. Vic Bailey says:

    I don’t see you saying one word about Ford and how many people they have KILLED ( which was hundreds), or how the government bailed them out in their 80s which was NEVER paid back and the government let them put a letter out about the hazards instead of recalling 21 MILLION and fixing their cars which would have been the BIGGEST recall ever of any auto dealer but the government let them put a sticker on the dash of the autos or how they dumped toxic waist from a plant in NY, or how they get by with a lot of things because they are a socialist company!
    Or how about the rigged explosion that NBC did about the side gas tanks of the Chevrolet Pickups, they were caught red handed and were sued by GM, but it was never put out that anything was done wrong.
    Let’s talk about how the democratic party shut down Chevrolet dealers because they were Republican, and let the democrats stay open even though the Republican dealerships were out selling the others! There is more to this crooked story than has been let out! Before you start throwing rocks make sure that your liberal friends weren’t in the middle of the corruption!
    Semper Fi.

  4. Felix Mosso says:

    I might as well put in my 2 cents worth. Our family never bought a gm car. Now that they
    are a china company, 70% of their cars are made there, from a video I saw of the Pres,
    I would never buy any gmchina car and all of their recalls does tell a story. You have heard
    where there is smoke there is first……….., the loan still makes me mad.

  5. Bob Wurth says:

    Many years ago GM came out with an electric vehicle which it leased to approximately 2200 or 22000 customers. The reports were great and the people wanted to buy them, but GM pulled them back and destroyed them.
    The people really loved those vechiles, and because GM refused to sell them or make more I have refused to buy any product made by GM. In my youth I owned many chevys and pontiacs and really liked them. Today GM has many fine looking cars and trucks but I have changed to Dodge pickups and will stay with them until some one comes up with a high quality electric pick up. I do enjoy your articles, keep up the good work.

    Bob W.

  6. Geraldina Howell says:

    Michael you hit the nail right on the head with GM. They have not understood that making mistakes are human, but fessing up is more human.

    Don’t hide your mistakes, it will come to the light soon.

    Although I have to give kudos to CEO Barra. She has a difficult road ahead of her. I wish her success.

    Yes the whole culture has to change from the top down and from the down up.
    Not an easy task. It will take years. All the problems they have were not created overnight and therefore will not go away overnight.

    Regards,

    Geraldina H., grandma from Oregon.

  7. David Ellis says:

    Quality control issues for sure. I’ve been in a GM product since the early 80’s with no problems , but the 2010 GMC sierra truck has had issues from day one. Headlights and panel lights dim at times for no reason. Defroster will not work on the passenger side. Definitely safety issues that GM can’t or isn’t able to fix after multiple visits to the shop. Unhappy customer.

  8. Anthony Suozzo says:

    Mike, I have been a subscriber for about 2 months. I cant thank you enough for the profits I have posted on your recommendations. Speaking of recalls, I purchased a 2014 Acura RLX. This car has had suspension issues from day one. There have been a few instances where the rear tie rod will actually shear off and the wheel will just basically fall off. There is a case pending now at NHTSA. Luckily no-one was travelling at high speed when this happened. American Honda is basically ignoring this and putting many at risk.
    It is amazing since they have not sold many of this vehicle that they are not addressing this immediately.

  9. NH Doc says:

    It ain’t the winter, it’s the salt and the heated garage that did in the brake lines on my Yukon.
    That plus the fact that they are mounted in channels that accumulate the salt between lines and frames.
    Few of us spray the underbody after driving on salty roads.
    Maybe switching from mild steel to stainless (as was done with mufflers successfully 30 years ago) would be wise/cost-effective?

  10. 48ozhalfgallons says:

    Typical corporate boilerplate. Pay no heed to responses beginning with the word “While”. It’s the same meaning as by and by.

  11. Bob Rogers says:

    More likely, Thomas Henderson had nothing to do that day … sitting around in his glass office. He just said: “Let’s see who has been mean to GM today.” Up pops Michael Robinson’s comments — and he had nothing else to do for the day.

  12. Jack says:

    Hello Michael,
    I am new to your nova x NL but not so new to your emails. I’ve really come to appreciate your honesty and integrity (and your company picking ability) the more I read your emails and now as a nova x subscriber. As a young boy I grew up with GM cars. Mostly chevy’s, but had pontiac and oldsmobile. That’s all we ever had. And even as an adult I had a chevy or gmc truck. My sister and brother-in-law, who also were gm car buyer’s started buying gm stock 30 years ago and had accumulated a substantial amout of shares. When the auto industry went through a really tough time back in 2009, and gm was considering bankruptcy my brother-in-law would say they will never allow them to file bankruptcy. Well as we all know they did and left the shareholders holding the bag. How many other folks had a lot of their life savings in gm. For that reason I would not own a gm product. I believe the scripture that says “whatsoever a man soweth, that shall he also reap.” I believe they are reaping what they have sown. The sad part about it is I still really like some of gm cars and trucks. thanks for letting me rant. Jack

  13. Richard Waldren says:

    Michael, many manufactures have a adversarial attitude about fixing something, (a part or product) to make it right. To do so means it is going to cost money or if they don’t act soon enough lives. They ask themselves how many people are going to die with this defect. Example, back in the early airline days (50’s 60’s) airline operators would ask the CAA, the forerunner to the FAA, to install an updated approach for hard airports to fly into. The CAA would then ask how many lives are going to be lost in order to justify this new approach. Sadly to say after a few crashes at one airport the new approach system would then be installed, no more crashes. Had the CAA acted properly in the first place a whole bunch of american lives would have been saved. It is sad to think that 100 people have to die before anything is done. So in GM’s case bad break line rusting through, how many people will die from salt on the road causing the rust, how many cars in salt areas, etc., etc. Companies find ways to build or make cheaper, quicker, faster etc. However just because you can find ways to build cheaper, quicker, faster does not mean it is right. There is no reason why a brake line should rust thru to cause an accident. Instead of using a good thick stainless steel line did they use a line of thinner wall thickness, or maybe a cheaper type of line not made of good corrosion resistant material? Companies need to have better quality control and most importantly the high bosses CEO, CFO, COO, Pres., Chairman or whatever need to talk to the snuffies on the line what they think of their job, application, installation. If the snuffies say this is a piece of crap, believe me it will be a piece of crap. Someone needs to then redesign or do whatever it takes to fix it. The same thing needs to be done in the field. Change just for the sake of change will not accomplish anything. So now instead of deaths, how much money will we spend on attorney or settlement fees instead of manufacturing fees? Michael you remember the old addage, ” we don’t have time or money to do it right the first time but we can do it twice.” Tis sad.

  14. Harry Van Wagner says:

    The problems at GM are a reflection of the qualitative lethargy that seems to be engulfing the executive and below political offices. We are losing our strength and determination as a nation to lead the world …politically and by example. History tells us that the first sign of a failing country is political lethargy. I fear that such lethargy is engulfing our top levels of leadership. Soon the jackals of the world will be circleing the US with belief that they can defeat us…because of our loss of will to win—hope I am wrong.

  15. Ron Osborne says:

    The problems GM has are not all at the manufacturing level. Customer service after someone purchases a car or truck is, in some Chevrolet dealerships,(can’t speak for all) nonexistent. I have five GM cars and trucks, don’t know if I will ever get another one because the service is so bad.

  16. Frank J. Cerny says:

    I Purchased a 2005 Trail Blazer July 5, 2005. A client of mine told me I had too many keys on my ignition switch key; it will cause me problems. He knew about this problem way before it was made public. One day my car stalled; fortunately I was able to pull over to the curb. I restarted the car and went on my way. The next day I couldn’t start the car. Had it towed to the local Chevrolet agency. They put in a new ignition switch. same thing happened. I gave the garage only my key. everything is fine now. You can purchase a key separator from a key lock business. I wonder if I can file a claim and get my cost back on the ignition switch?

  17. Steve says:

    The buck must stop at the top. firing employees because of a faulty switch is grasping at alternatives. Quality control may require more thought and further application during construction. This new CEO will only create enemies and a reputation for the wrong reasons.

  18. charlie says:

    As a former contract engineer in Dearborn for a major auto company, I know first hand the inbred culture of do as little as possible, ignore problems with “that’s not my job’ or “we’ll catch it later” . Put your time in, get along with the guys, don’t make waves about problems. Eventually, and it can take quite awhile, it all catches up with you.

  19. Joseph L. Sexton says:

    I would love to BUY AMERICAN & will when their “quality & integrity” comes up to the Asians.

    I was all set to look at Buick’s, then I find out that since 1997 GM knew of the defects & chose to allow 13 American buyers to DIE, instead of fixing their cars.

  20. Al says:

    “But we created this service to attack one specific issue – the sad and scary fact that more than half of U.S. households have almost no savings.”
    I hope that was said ‘tongue in cheek’! Those who benefit will be those who DO HAVE SAVINGS.
    No savings = no investment = no benefit.
    MORE SAVINGS = more investment = more benefit.
    MOST SAVINGS = most investment = MOST NENEFIT!
    The rich get richer – the poor get poorer, broadly speaking. Yes – No?

    • Peabody says:

      Yes. Thanks to the government. The total debt of the middle class is close to the national debt, so you can add the middle class to the ‘get poorer’ in your comment. The average credit card debt is more than $15,000.

      Stealing from the rich won’t solve the problem. If ALL of the wealth of the rich were taken it wouldn’t cover the deficit (the amount of money that the government spends over what it collects in one year) and THAT could only be done ONCE.

  21. pat shannon says:

    Get rid of the unions. Union members know that they are not responsible for the product they turn-out because the union will cover for them when they f–k-up. Sadly, this is most of the time because they have the “entitlement” mentality and have no self-esteem or personal pride and only “WORK” to draw a paycheck and benefits with no responsibility for what they do.
    Welcome to ObumassLand!

  22. Judi says:

    Unfortunately GM has a very long history of ignoring “little” fixes which may cost $1 to $5 to fix the problem per car and instead choose to have the bad publicity of people being permanently disabled to whole families burning to death horrendously or being taken into court and sued for million to billions of dollars! I’ve been a car kid since I learned to walk. My dad, uncles and grandpa used to run an automotive shop and literally do everything and well as working what they called a “real” job too.

    Most of the older Chevys, ones that are now called “classics” are the ones I grew up seeing on the street every day and learning to drive in. However, back in 1969, my older sister was following her friend. who was getting married the very next day, when she lost control of the car, slammed into the side of the (below-ground) freeway in Phoenix, AZ. Okay, that happens quite unfortunately too often. However, both girls were driving Corvairs (remember them?) and the other girl’s was the newer model that was on the recall list because the car had a major problem with the steering gears locking up and causing the driver to lose control of the car. A very senseless and tragic accident! My dad and a friend of his who was a GM mechanic rebuilt my sister’s car (my dad bought it with the engine literally in cardboard boxes in the backseat. Luckily his friend knew about the problem with the car and he and my dad rebuilt the steering gears and fixed the problem for about 50 cents. Was that girl’s life, along with her future husband and family’s lives? being destroyed? Torn apart worth it? Okay, it was a little fix, but my sister’s friend was not the only person killed for that 50 cent fix. Was GM sticking to their guns over that difference in the cost of building a reliable car worth it?

    Okay, another one. The Silverado trucks with both brake and gas line problems. The gas line problems I know about were not in snow country either! I used to work for a ship building company on the east coast and it was common practice that the bolts on salt-water vessels were Nickel-Cadnimum. I noticed the difference right away because they have this crazy green-gold color to them, so I asked my crew chief. I was told that the Nic-Cad bolts are salt water resistant. Okay, so GM, how about changing the regular gas line for a Nic-Cad line instead. Oh, it costs a few dollars extra? How much are the lives of fathers, mothers, sisters, brothers, babies, aunts, uncles, grandparents worth? You couldn’t buy a baby from ME!You could not give me enough money for me to be able to replace the person or people who died for that coupe of dollars you wanted to save.

    And that is not the last of the problems that have plagued GM over at least the 62 years that I have been alive! I have both heard even GM after-care mechanics, owners and drivers complain of numerous problems. I had to buy another vehicle when the engine in my Chevy Citation developed “engine croak”. (That’s what I called it at the time, it dumped all the water into the oil pan, not a good thing to have foamy oil in your engine.) I called a company that sold rebuilt engines and for about $3000 I could buy a new motor, but I would have to take out the existing motor and then install the replace motor AND they wanted the existing engine too. So I started asking question like “is it common to have to replace a motor within 5 years of buying the car?” The guy on the other end of the phone asked me how many miles I had on the engine and I told him 130,000 and he told me that the engine was built with an obsolesence factor so that the engine failed at 100,000 miles. So, I guess I got an extra 30,000 miles as a bonus from GM? I really liked the car too, had nice clean lines, a wide hood scoop, the tail fin and mag wheels and I had to sell it because I couldn’t see replacing the engine every 100,000 miles. That’s the breaks some days.

    Why not actually build a better car? The big car manufactures have undermined people like Tucker who was way ahead of his time with safety equipment that would be standard. The was an craftsman that built an engine that would get over 100 miles per gallon, they got the plans from him and buried them in a safe or office somewhere. When the learn about part failures on vehicles, they would rather face the bad publicity of crippling people, killing people and class action lawsuits than to remove the parts that are defective and spend a few cents or dollars more and correct the problem permanently. I still say, like government, they are penny wise and pound foolish.

    Judi W.
    Sacramento, CA

  23. Kevin says:

    Good point sir.i to own a gm gran am.back in 2006 i brought it at car dealership.first problem key ignition car wouldnt start.the more i turned nothing.i spent over time $4000.00 nobody told me what was wrong gm dealers said bad wiring.that was lie.they know back in 2004 those cars had problem but nobody concerd.love of money not people.

  24. Edward Paragi says:

    Alfred P. Sloan’s 1964 book “My Years With General Motors” was a well written history of how the modern company was formed in the 1920’s and grew to be the vertically integrated behemoth that was Sloan’s legacy. Admittedly, it was biased in favor of the company since it was written by an insider, but it did provide a rather accurate choronology with perhaps a few overlooked warts. Nine years later, John DeLorean wrote “On a Clear Day You Can See GM.” Nearly everything that was wrong with the company from DeLorean’s perspective then is still wrong with it today. The Federal Government did the taxpayers and the car buying public a great disservice when it bailed out GM. Bankruptcy would have provided a catalyst to clean out the rot in the management of a once great company. I have owned more GM cars and trucks than any other brand, but I will likely never buy another GM badged vehicle.

  25. Jeff Campbell says:

    Zero tolerance in Japan for this behaviour would be unthinkable. Pot + Beer = GM quality control. I have never bought into the propaganda of American Exceptionalism. One thing is exceptional in the USA and that is marketing BS #1 on the planet.

  26. Bernie Newcomer says:

    So now they are going to focus on the customer-does that mean in the past it was profits only? Wanted to save 57 cents per switch.
    Also taxpayers lost 11 billion on the gm stock and the previous C.E.O. said that how the market works. Maybe we should have let the market “work” and not bailed out GM.
    GM did not care for the consumer or taxpayers then and still do not.

  27. michael dwight says:

    GM has lost it! starting now I would not buy a GM product for at least 10 years . as most of the recalls are for older cars, who knows what lurcks under the hood. i’ll buy japaness every time.

  28. augusto says:

    It’s always easy for newspeople to pick on some body like GM to get attention from the public. It’s not that the reporting is false but it is indeed full of discrepancies as well. GM is a giant – it will take some time to bring everyone into the new company philosophy. The most important is that they are working on those problems. How about checking on Toyota, Ford, Chrysler and even Mercedes. You will be surprised at the many problems in those companies. Don’t try to be a hero – you are still a small tiny organization. At least GM is doing its share to clean up – don’t slay the giant while it is recovering from a death blow – trying to be a hero at somebody’s expense is just as bad as the victim of your attacks. Are you for real – did you spend weeks and months with workers, plant operations and management at GM? Or you are just basing your reports on hearsay to feather your own name….are you for real? or just another little known person trying to muscle up and pretend to be a big hero????

  29. Dale left coast says:

    “Contrast that with Subaru, which a week or so ago said it was recalling about 660,000 U.S. vehicles – for the very same reason. ”

    Could be the Japanese automaker learned something from the ongoing Secret Warranties of Honda and Toyota . . . who for decades did repairs under the table, sometimes when the car was at the dealer for maintenance, often without ever telling the owner.
    This of course ended about 8 years ago when the steering shaft separation in a Camry killed an entire family . . . then the unintended excelleration thing broke, which has today been proven to ba a software issue. Hundreds of lawsuits and the media is absent and uninterested. The daycare incident was the latest of many.

    Never owned a GM product, but much of the problems may have to do with the corrupt way the bankruptcy was engineered . . . investors got stiffed and the unions made out like bandits

  30. tim crary says:

    All car manufactures will always have recalls, it’s the nature of the animal. At one time GM had 98 models.Now they only have chevy ,buick,cadillac cars and trucks here in the US. That is a lot less vehicles to keep track of as far as quality control, and they now are starting to recall a lot of there new model . SO they still do not have a handle on their problems yet !!!!

  31. Eric says:

    Although I agree that GM is making better vehicles, they have a big uphill climb yet. I think they still try to adopt cost cutting strategies and are focused on the wrong objectives. If newer vehicles(eg: 11-12 models) are still having ignition issues, that does not say much for GM’s claims of a new corporate culture. A culture that is the ‘new’ GM.

    GM, I believe are adopting cost cutting strategies even now, because of past mistakes, here and abroad. Their 15 Camaro is still based of an antiquated chassis used in Australia-where they are pulling out of!! Holden and Opel rest in peace. I at least applaud GM for offering real luxury cars like Caddy that have what people want- competitive luxury vehicles and/or rear wheel drive performance!

    GM needs to be worried about chasing quality, not quantity. They think they can, or should, overtake Toyota as the number 1 manufacturer. The reason Toyota is #1 is because they focus on quality and fixing their mistakes-fast. VW wants to be, but is nowhere close to being #1 because of perceived quality issues. And I believe they put more effort into their cars than GM. GM is changing, and not totally in a bad way. They’ve got new and really nice cars and trucks in the pipeline. But…is it enough?
    Time will tell.

  32. Dustin Nutter says:

    Changing corporate culture is not easy but has been done by Frank Blake with the Home Depot. As a loyal GM Chevy truck guy, I hope Barra has talked to Frank or plans to.

  33. Bryan says:

    Dear STI,,
    In response to the your article on investments in GM , let me simply say I agree wholeheartedly. With my family roots deep into GM as well as another top 5 fortune 500, starting with G,, I can attest to experience, 33 yrs of some of the ingrained of corporate bureaucracies!! My dads pop worked for Albert Champion and later David Buick,my parents and grandparents all Flint inhabitants,,where the saying was “so goes GM,,so goes the country” , and well right they were…! My problem with GM is also deeply rooted,,losing everything on inherited shares of GM and Delphi,,as well as experiencing significant prpduct failures,,reiterating the brakeline safety issie. In my mind they haven’t had a good idea in 25 yrs. My 3500 Express Van and 96 Buick LeSabre both experienced brakeline failures, not resulting in accidents,,bit definitely scaring the crap out of me! The response from GM ,the cars will still stop,,played down as cost of ownership,,and I don’t even live in the “snow” regions of concern. The problems at GM are a fundamental management issues as you stated which require the blue pill !!

  34. ralph says:

    precisely because of .57c decisions and quality control issues vs. profits and distributed earnings….is why i never bought GM autos….does one really need to be told to put stainless/or other corrosion proof lines on cars facing continual salt/water exposure? what on earth are engineers doing-if not realizing critical safety material choices a 5th grade would make?
    GM-and chrysler and ford all had almost 40+ years to sense the foreign competition effects of better quality control, reliaibilty, economy, size and features etc. that completely undid their smug, ethnocentric posture……so the aggregate market-over time- taught (actually:NOT…..) where they missed……and i dont feel sorry, loyal or sympathetic….especially in view of executive thru union worker pay scales…..this is bad economics -as are bailouts of inferior competitors in any marketplace…..

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