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The Indictment of G Richard Wagoner

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Guest buickman

OPENING BRIEF

Statement of the Case

"Rick" Wagoner, at 39 years of age, became Chief Financial Officer of the General Motors Corporation in 1992.

Mr. Wagoner was promoted to head of North American Operations in 1994.

In 2000, he was elevated to Chief Executive Officer.

Upon the retirement of "Jack" Smith, the "fast track" was completed and the heir apparent assumed his current Chairman of the Board position.

During the past FOURTEEN YEARS, this man has been a central figure in the hierarcy of GM management. He has undoubtedly been critically involved in the stategic planning of GM, and additionally has acted repeatedly, even methodically, in it's implementation. That strategy is built upon a goal of significantly reduced headcount in US operations, as well as a coordinated effort to eliminate franchised dealers thereby enabling eventual factory owned distribution channels.

This architect refuses to reveal his blueprint, and has deliberately deceived investors, employees, dealers, and customers. While selling off assets, closing divisions and retail outlets, laying off and paying off thousands of employees, Mr Wagoner has continued the misguided tradition at GM of empty promises and meaningless commitments. Earnings guidances have been withheld, financial statements revealed as improper, credit ratings have sunk well into "junk", long term debt has risen tremendously, losses have grown, and market valuation destroyed.

Under the direction of Mr Wagoner, failed members of management have simply been moved to "special assignment". There is a serious lack of accountability at General Motors, even to the point of Mr Wagoner giving himself a bankruptcy proof pension.

Let's ask ourselves the following:

Why did Oldsmobile go out of business? Was it that poorly managed, or closed intentionally?

Why has Buick been starved of product in spite of promised billions for product development?

Why are Buick dealers being "channeled" into combining with other GM franchised operations?

Why do we have a Jobs Bank, paying employees to do nothing while we employ contracted personnel and pay overtime to different workers?

Why do we continue to close our most efficient and highest quality plants?

Why do we claim to have a price cut while only truly cutting the dealer margin?

Why do we create a VEBA structure to handle expenses for health care, and pay the UAW to administer the program?

A few years ago Mr Wagoner issued a mid-decade earnings projection of $10 per share. When the time arrived and he was questioned as to his failed forecast, the man had the audacity to reply that "It depended on how you define mid-decade". Last year the shareholders of this company lost almost $20 per share. Yet this man remains in place and has received a vote of confidence from the Board.

Again, ask yourself WHY ???

This brings us to the List of Players and Statement of Facts.......

Buickman

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Does he not bring up some valid points???

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I agree with Buickman that overall the tenure of Rick Wagoner has been a piss poor one. Almost any other company would have dumped this loser a long time ago. Right now GM needs someone of the caliber of Lee Iacocca or Carlos Ghosn to turn the company around. The point is that GM can do much better than Wagoner. :nono:

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Does he not bring up some valid points???

Nope; everything is hunky-dory and A-OK, Sixty-8. Steady the course... a thousand points of light. Lookin' good from here. I think another injection is in order. Grin grin, wink wink, nudge nudge, say no more. Don't question ANYTHING, trust in the company line. {puts finger to pursed lips and makes 'be-bub-be-bub-be-bub' sound, eyes pinwheeling}

I vote for a bonus. :wacko:

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Let's ask ourselves the following:

Why did Oldsmobile go out of business? Was it that poorly managed, or closed intentionally?

Both. Even with the new product and arguably the best line up at GM at the time, sales at Oldmobile continued to drop. It was decided at the time to cut the losses and focus the investment on brands that needed it more. Cadillac and the growing truck market at the time. In the end, GM or the market does not appear to be worse off with the loss of Oldsmobile. When you look at the sales mix at around the time the decision was made to dissolve Olds, the brand had little appeal and was a fleet factory. Olds was the easiest of the brands to axe because the dealers were aligned with other divisions. Even with good product, GM could not communicate that to the public. It would seem, that lack luster advertising along with a poor image, Oldsmobile was the brand to go. GM saved hundreds of million in advertising and marketing in the long run to desolve the brand. And lets put this into the context of history. John Rock conviced management in the early 1990s to give the Olds brand a chance. Axing Olds was not a rash decision. In 1999 era GMC was on the chopping block also. The 800s and switch to SUVs saved that brand. Olds problems were decades in the making and can not be attributed to 1 individual.

Why has Buick been starved of product in spite of promised billions for product development?

It has not been starved of product. The oldest vehicles in their lineup at the moment iare the 360 Rainier and Rendevouse. And both are scheduled for replacement with the Lambda vehicle in the next 6 months. Everything else is only a couple years old at most. Now if it was said, product that is relevant to the market I would agree

Why are Buick dealers being "channeled" into combining with other GM franchised operations?

That is easy:

1) Give the dealers volume.

2) Tighter focus for each brand without product over lap in this newer sales channel.

2) If any of the divisions are not salvagable, one or more of the brands can be desolved with minimal payout to the dealer if any. Volume could be made up in the division with investment in a viable brand.

Why do we have a Jobs Bank, paying employees to do nothing while we employ contracted personnel and pay overtime to different workers?

Poor contracts that were signed 25 years ago. GM has too many employees given efficiencies made in manufacturing and GM is no longer a fully integrated automobile manufacturing company. The Jobs Bank were away to keep labor peace, pure and simple. Hence the recent buyout and in 2007 there will be a new contract. The contract workforce is a temporary necessity because of the buyouts to keep the product flowing until GM can balance the workforce in each plant.

Why do we continue to close our most efficient and highest quality plants?

Efficeint plants are not be closed. Osh 1 and 2 will be integrated and merged into a more efficient plant. As will SH 1 and 2. This will further reduce GMs labor burden when compared to the competition and bring the number of vechicles/employee inline with Toyota in NA.

Why do we claim to have a price cut while only truly cutting the dealer margin?

This has been going on for decades. This is nothing new and is used by most manufacturers. I am not condoning the practice but business as usual. But if it helps the dealers to sell more vehicles in volume, more service revenue, more used cars, what is the point. Dealers as is my understanding to not make their money on the front of the store, it is everything else, they scam the public on to make their money. Lo-Jack, undercoating, service, parts, warranty, etc....

Why do we create a VEBA structure to handle expenses for health care, and pay the UAW to administer the program?

I can not answer that fully.

A few years ago Mr Wagoner issued a mid-decade earnings projection of $10 per share. When the time arrived and he was questioned as to his failed forecast, the man had the audacity to reply that "It depended on how you define mid-decade". Last year the shareholders of this company lost almost $20 per share. Yet this man remains in place and has received a vote of confidence from the Board.

Well without a link to the article, the context of Wagoner's quote is not verifiable.

In defense of Wagoner, GM needed a whole sale restructuring and that is what the company got in 2005. A restructuring of the likes that cost 10 billion. IMO, Wagoner did not go far enough. But I will give him until January 2008; not only to get the product right because that is what it is all about, but to get the 2007 contract right.

Edited by evok

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Oh and BTW, what about all the good news out of GM-DAT, deals in Russia to build plant, growth of Chevy in Europe, etc. Your rants conveniently leave them out. Sorry to tell you, GM USA is less than half of GM's business.

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In 1999 era GMC was on the chopping block also. The 800s and switch to SUVs saved that brand.

Circa '99 GMC had posted it's 7th in as many years of record sales. If the ROI only gets worse the higher the volume rises, then GMC should've been axed circa '92 and saved the Corp a lot of red ink.

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Circa '99 GMC had posted it's 7th in as many years of record sales. If the ROI only gets worse the higher the volume rises, then GMC should've been axed circa '92 and saved the Corp a lot of red ink.

Well obviously it did not! GMC was on the chopping, and if the decision went ahead the vehicles and dealers would have been branded Chevrolet across the board. What saved the division obviously was the premium pricing and volume. With Olds being given the, there was talk about excess pad press.

A little history.

http://www.highbeam.com/library/doc0.asp?d...eyword=&teaser=

http://www.theautochannel.com/news/date/19.../news02178.html

"Roberts also hinted at GMC's future, as early as 1999, carrying

exclusive drivetrains and technology that will not be offered by

Chevrolet. The strategy, he explained, is to keep Chevrolet and GMC

teamed against competitors in the mid- and upscale-level segments,

respectively, rather than competing with each other for the same

buyers."

http://www.theautochannel.com/news/date/19.../news00196.html

Which lead to this:

http://www.adweek.com/aw/national/article_...tent_id=1825547

Edited by evok

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Oh and BTW, what about all the good news out of GM-DAT, deals in Russia to build plant, growth of Chevy in Europe, etc.  Your rants conveniently leave them out.  Sorry to tell you, GM USA is less than half of GM's business.

Not only does BM leave that out of his arguements, so does the media when they claim bankrupitcy is afoot at GM. Although those claims have died down. Now they just act like the GMT-900's aren't world class. :censored:

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No one has ever answered the question of whether Buick actually received the promised $3 billion in product development. If they did and it's gone, it seems to have been spent poorly on mediocre or rebadged vehicles. Or is the money yet to be spent and will be used over the next 5 years (for Lucerne [statesman], Enclave, and Epsilon II LaCrosse)? Or was the money diverted to other GM concerns?

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Good question.

aren't you going to address evok's comments? or are you going to do what you normally do and just keep throwing FUD and ignore all sane arguments.

cue mini-BM to leap to the defence of his mentor (in all his belt buckle glory!)

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cue mini-BM to leap to the defence of his mentor (in all his belt buckle glory!)

He's standing in the welfare line with two million other Detroiters.

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Guest Josh

I think it's time for personal attacks to end, and pointless posts to end. Fly, stop the childishness of these forums and at least try to restore some maturity to these forums?

Dollinger presents many great ideas and asks serious questions. I don't know any body here, but BusinessWeek has never asked to interview me about my thoughts, have they to anybody that is doubting Dollinger? And if so, can they prove it?

Jim, I'll get in touch with you soon. I have a new project in the works, but I'll discuss that offline with you.

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Cheers and Gears also offered to interview BM, and where did that go? It doesn't matter who interviews him, what matters is results and it is very obvious that nobody in the industry believes that he can get results, which is why GM hasn't implimented the Return to Greatness and the other automakers aren't knocking his door down throwing cash at him to help them out.

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Cheers and Gears also offered to interview BM, and where did that go?  It doesn't matter who interviews him, what matters is results and it is very obvious that nobody in the industry believes that he can get results, which is why GM hasn't implimented the Return to Greatness and the other automakers aren't knocking his door down throwing cash at him to help them out.

Yes, but he has raised the big question of "Is there nobody better in this world to run GM than Rick Wagoner?", which is a question that surprisingly few people in the world have the guts to raise. I give him a lot of credit for that, because many people here just drink Bob Lutz's kool aide, and keep believing the old line that "The hot products are just around the corner, GM's about to turn around!" :nono:

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Yes, but he has raised the big question of "Is there nobody better in this world to run GM than Rick Wagoner?",

Yes he has and he nominated himself. Jim "BM" Dollinger for Chairman and CEO of GM. He is the man with the plan. And he has been requested to be interviewed by Business Week.

There is no better endorsement than that!

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Is there always someone better, yes. But right now, with GM in all of the trouble they're in making a big change at the top would slow the company down.

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Well obviously it did not!

Obviously did not what??

GMC was on the chopping, and if the decision went ahead the vehicles and dealers would have been branded Chevrolet across the board.  What saved the division obviously was the premium pricing and volume.

A little history.

http://www.highbeam.com/library/doc0.asp?d...eyword=&teaser=[/url]

http://www.theautochannel.com/news/date/19.../news02178.html[/url]

http://www.theautochannel.com/news/date/19.../news00196.html[/url]

Which lead to this:

http://www.adweek.com/aw/national/article_...tent_id=1825547

Cool!: you posted links!

.....uhhh, however... none of them even alluded to the contention that:

In 1999 era GMC was on the chopping block also. The 800s and switch to SUVs saved that brand.

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Guest buickman

Complete fabrication. I was nominated for the Board by Mr John Lauve, the man who championed the proposal on electing Directors which just passed at the meeting. My expertise is in sales and marketing, not running a global enterprise.

Buickman

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I think it's time for personal attacks to end, and pointless posts to end. Fly, stop

Josh...you say "I think it's time for personal attacks to end........"

What exactly is it that BM does in nearly every (if not every) post he's ever put on here?

When anyone questions him or challenges him, he attacks.

Are you that blind? Surely you can't be.

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