We’ll be hearing a lot about the annual Auto Show over the next couple weeks, and I’m sure the lean bloggers will have a lot to say. The rules of the auto manufacturing game are changing every day… just think about what "the big three" or even the "top three domestic manufacturers" means today. Are you sure you can name the companies that belong in those groups? The next couple weeks could be better than any soap opera, although a sitcom is probably a more fitting description.
GM’s Rick "More Production" Wagoner is going to have a fun couple weeks. Perhaps GM’s wild party can further distract himself from the realities of his business. As he said earlier this week,
“I like being No. 1, and I think our people take pride in it,” Wagoner said this week. “It’s not something we’re going to sit back and let somebody else pass us by.”
Those are fighting words. Too bad he’s chasing the wrong metric… production volume instead of profit, reputation, quality or anything else that means something to the customer or shareholder. As our friend Jon MIller over at Gemba Panta Rei puts it,
Mr. Wagoner fails to understand that the goal for the General Motors Corporation is absolutely positively definitely and without a doubt not to remain in the number one spot on the basis of the number of automobiles produced in one year. Unless all of these vehicles are sold, and unless the company is profitable and is generating free cash flow as a result, being number one is pointless for GM. Toyota understands this, and that is why they will displace GM as number one. That is also why Toyota is playing down this issue.
Yep, let’s hear it for number one!
Ford’s Alan Mulally will be hobnobbing with Mr. Number One, but he’s probably smart enough to realize that number one isn’t all it’s cracked up to be. Mulally actually knows something about real lean manufacturing, and isn’t afraid to visit Toyota to talk more about it. His big problem is turning a behemoth bloated ship before short time horizon shareholders become impatient. Mark Graban over at the Lean Blog has been keeping a close eye on Mulally, with reports here, here, and here. Selling a few cars to mega millions of customers is a little different than selling mega million dollar planes to a few customers, isn’t it.
Then we have Chrysler, headed by Tom "Inventory" LaSorda. After that overproduction fiasco, poor Tommy is on the hot seat. There’s even speculation that VW’s soon-to-be-ex-executive Bernhard could be headed for Chrysler’s board room.
DaimlerChrysler CEO Dieter Zetsche will be keeping an eye on LaSorda while trying to explain the plummeting quality reputation of Mercedes-Benz, as well as the future of DC’s two marginal brands, Maybach and Smart.
I’m sure Carlos Ghosn of Nissan… and Renault… will be there. Likewise execs from the other domestic manufacturers… Toyota and Honda. There might even be some cool looking cars.
Barry "aka the Hillbilly" says
Fighting Words Indeed !
If Mr. Wagoner, Mulully, and LaSorda don’t understand that the other guys are playing for keeps, well then I suppose the Handwriting is on the Wall.
Judging from the events of 2006, I believe they might now be coming to an understanding of the graveness of their situations.
I think the next five years will be telling. One of them is probably going to get hurt.
Good luck to them all.
Mark Graban says
How can GM justify big flashy parties like that with their financial problems???? To impress journalists, who are biased against GM anyways?