"Once again, Bob won't get the job." That was the definitive prediction this weekend by Automotive News, the industry's journal of record, on GM vice chairman Robert Lutz's chances of being named CEO [link may require subscription]. Yesterday they were proven right when GM's acting CEO, GM chairman Ed Whitacre, announced that he would continue permanently in the position. What they got wrong, however, was why Lutz was unfit for the top job.
Automotive News let Lutz speak for himself, arguing that at 78 years old he was too "geriatric" for an ailing automaker in need of rejuvenation. That logic flies in the face of Whitacre's logic that what GM needs most, after ousting two CEOs in 2009, is stability. After all, Lutz has served in top product development and marketing roles for GM since 2001, and previously held top jobs at Chrysler and Ford.
What makes Lutz the wrong man at the wrong time is that he rejects the intensifying concerns for sustainability that now drive automotive markets and innovation worldwide. At the Detroit Auto Show last week Lutz held forth on climate science with the Sydney Morning Herald, explaining that Earth is being cooled by a dearth of solar flares rather than warmed by greenhouse gases from cars and other fossil fuel-burners:
"All I ever say is look at the data, look at the empirical evidence...Katrina was six years ago and we have yet to have the next hurricane.”
It was classic Lutz. The product-development chief who contributed to GM's reliance on ever larger and less fuel-efficient trucks has made regular headlines with his contempt for the theory of climate change, most famously in 2008 when Dallas-based D magazine quoted Lutz calling global warming a "total crock of ****." No surprise then that many in the green-car movement cheered Lutz' imminent retirement early last year -- plans he suspended to help save GM.
Lutz apologists point to the self-styled motorhead's role in developing and securing plans to produce the Chevy Volt, a fuel-efficient plug-in hybrid -- this after dismissing Toyota's hybrids as a marketing stunt, albeit a wildly successful one. Unfortunately, the Volt will be too expensive to save GM, according to my colleague Philip Ross' analysis in Spectrum's January issue. (Will the Real marketing stunt please stand up?!)
Lutz himself has argued that his off-color remarks on climate change "have nothing to do with the decisions I make to advance the cause of General Motors," but that is just silly. Daniel Sperling and Deborah Gordon cite Lutz' remarks as a failure of management in their treatise on automotive sustainability, Two Billion Cars, published last year by Oxford. Sperling and Gordon quote a 2008 editorial by Automotive News publisher and editorial director Peter Brown on the value of posture and words:
"When the vice chairman of GM, an icon and the czar of vehicle development, calls the scientists' consensus on global warming a bunch of doo-doo, he's unavoidably speaking for the company. Does the consumer want to buy a car from a company that professes to want to save the world (think Toyota and Honda) or from a company that begrudgingly plans to meet what it characterizes as misguided federal standards?"
Sperling, who runs UC Davis' Institute of Transportation Studies, and transport policy analyst Gordon say Lutz' commentary reinforces questions about the depth of GM's commitment to advanced environmental technology, since the company "feels no need to reign him in."
Hopefully CEO Whitacre, who was installed as Chairman last year by President Obama, will do just that.
If Whitacre does send Lutz packing, it will be on behalf of GM's employees, shareholders, and creditors. GM's latest CEO reiterated yesterday that the company plans to repay $5.7 billion in loans outstanding from the U.S. government by June, as well as $1.4 billion it owes the Canadian government.