GM Stuck in Reverse

I know I’m being a bit naive here, but it’s shocking to me that the major American car companies continue to be quoted in the media as being surprised by the sudden downturn in sales, particularly of SUVs and trucks.  This has been coming for years, as outlined in a great piece by Jad Mouawad and Nelson Schwartz of the New York Times (American Energy Policy, Asleep at the Spigot; 7/6/08), and finally has hit a tipping point with the cresting of $4/gallon.  Today’s Times includes a story on GM’s initiatives to build its liquidity position by cutting costs and selling assets, including the elimination of medical benefits for most white collar retirees.  The juxtaposition of a 74-year-old retiree fighting cancer (on a prescription drug costing $2,700/mo.) and a tough quote from Bob Lutz, the well-known GM vice chairman, is startling.  The retiree, William Parker, will lose coverage for his medicine, as part of GM’s moves.  Later in the story, tough-talking Lutz, now 76, in commenting on GM’s prospects, admonishes securities analysts who have been warning of a potential GM bankruptcy: “At some point, these analysts should learn that car companies don’t die that fast.”  Obviously, his quote is not related to the plight of Parker.  But you’ve got to question the forward-thinking and visionary tendencies of GM, whose chief product officer is 76 and long entrenched in Detroit’s insular ways.  I guess it’s because he chomps cigars and is a former Marine pilot.  Guess that makes him qualified to lead GM into the next-generation marketplace.