What Went Wrong? Everything at Once.

THE END CAME WITH ALL THE BITTERNESS of a military surrender. For weeks General Motors chairman Robert Stempel had tried to ignore the signals of discontent radiating from a hostile band of outside directors. When Stempel was hospitalized with an attack of high blood pressure, board members did not bother to phone him get-well wishes. When rumors flew that Stempel was about to be ousted, the board issued a statement that conspicuously lacked a denial. Finally, Stempel, 59, bowed to a point-blank demand from a third-generation GM board member, who told him it was time to leave the post he had taken scarcely two years ago.

...

The bloodletting promises to be deep and wide and painful. Impatient with Stempel's slowness in carrying out plans to close 21 of GM's 120 North American plants and cut 74,000 of its 370,000 employees over three years, directors now want to eliminate a total of 120,000 jobs during the decade. A major goal: to slash GM's labor costs of nearly $2,360 per car, which is almost $800 more than Ford's and $500 more than Chrysler's. "It's going to be brutal," warns a GM director. "If the unions won't cooperate, GM will have to play real hardball. We don't even have the luxury of thinking about a product strategy. We aren't going to be thinking great thoughts. GM has a three-year mission to restore its financial soundness."

That won't be easy for a company whose U.S. market share has plunged from a peak of 52% in the early 1960s to just 35% today. GM last week reported a $753 million loss for the third quarter and is careering through its third straight year of deficits. GM's North American division, the heart of its business, lost an astonishing $7.1 billion last year -- $1,700 for every car, truck and van it sold in the U.S., Canada and Mexico. The red ink was stanched somewhat by GM's car business outside North America, whose $2.1 billion profit helped cut the overall yearly loss to $4.5 billion -- still the most dismal showing ever by an American company.

The automaking losses have put GM in the kind of financial position lately associated with dying airlines and retail chains. The company has been frantically seeking cash to meet its financial obligations. GM has sold stock and tapped credit markets to raise $5 billion in the past year alone, mostly to pay operating expenses. If the financial squeeze grows too tight, GM might even file for bankruptcy protection under Chapter 11 to force concessions in its wage, pension and benefit packages. "This is not the company it once was," says a GM director. "There is going to have to be special oversight by the board for the next three years. Our credibility is at stake in the credit markets."

...

Its sheer size, however, is one of GM's greatest burdens. Because of arrogance and inertia, GM has fallen out of touch with its customers. Except for products of GM's Saturn and Pontiac divisions, young drivers increasingly spurn the company's cars for Japanese makes or other U.S. models. The median ages for buyers of GM's bread-and-butter midsize lines are 45 for Chevrolet, 55 for Oldsmobile and 60 for Buick. By contrast, the ages of U.S. buyers of Japanese cars range from 35 to 40. GM has foundered while the more nimble Ford and Chrysler, which had long scrambled for niches in the GM-dominated marketplace, cut costs and brought out popular models like the Ford Taurus and Chrysler's minivans.

GM has consistently ignored showroom signals about its cars. The company failed, for example, to develop a new sports utility vehicle like the Ford Explorer, which represents one of the hottest market segments. When buyers yearned for minivans, GM simply slapped new plastic panels on a seven-year-old chassis and rolled out the Chevy Lumina All-Purpose Vehicle. Result: while GM has made steady improvements in car quality, its selection and styling have tended to lag far behind its U.S. and Japanese rivals. "GM hasn't listened to its dealers," says an Atlanta Buick dealer. "They haven't paid any attention to the comments of the owners. We've had problems with supply and the design of the cars, and Ford and Chrysler and the Japanese have beaten GM all over the lot."

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Stempel had the misfortune of becoming chairman just as the U.S. was sliding into recession. That hindered sales of GM's 1991 fall line, one of its best in years. The redesigned models included the full-bodied Buick Park Avenue and the luxurious Cadillac Seville. "Our sales depend on the economy," says Jamal Karmouta, who manages a Chevrolet dealership in Southern California. "When the economy moves up a little, we'll be selling more cars." But with GM strapped for cash, its new offerings for 1993 are limited mainly to a redesigned Cadillac Brougham and sporty Camaros and Firebirds.

In the layoffs to come, brutality will have to be tempered. GM must restructure its business without further alienating workers whose cooperation will be crucial to the company's success. While the U.A.W.'s relations with GM have generally been much stormier than those with Ford or Chrysler, the union seems willing to give the new management a chance. Says former U.A.W. president Douglas Fraser: "There's a fundamental truth -- the workers can't survive unless GM survives." And Stephen Yokich, head of the union's GM department, says he wants to help the company become more productive. But Yokich adamantly opposes GM plans to increase its purchase of materials from nonunion firms.

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GM's biggest challenge will be to shift from the top-down style of management that has characterized the company since Alfred Sloan to a more collegial style in which everyone from the shop floor to the executive suite participates in decision making. That is no longer a revolutionary idea among GM's rivals or industry at large. Ford developed its Taurus using nearly autonomous teams of workers, and Chrysler last year opened a mammoth $1 billion technical center that will bring together 6,000 technicians, designers and engineers to work on joint car projects. Perhaps not surprisingly, Ford and Chrysler have recently reclaimed market share from Japanese automakers, while GM keeps losing ground.

...

In GM's case, the company that once bestrode the world now has trouble paying its bills. "We wasted too much time and money, and we're finally down to the point where it's nip and tuck," says a senior GM executive. "To me, the sad part is, Couldn't we have done it any other way?" Apparently not. But besides cutting costs, GM must now focus its attention on something the company has too often seemed to forget: how to build cars, trucks and vans that more people are happy to pay money for.

ARTICLE FROM ... NOVEMBER 1992 !!!

TALK ABOUT NOT LEARNING FROM HISTORY!!



http://www.time.com/time/magazine/article/0,9171,976990-7,00.html

Tell me again why I and everyone else are paying your salary to produce junk?

gm is making some of the best cars in their class. gm has the highest fleet mpg than any car assembler.gm has the largest test fleet of hydrogen fueled vehicles.

And yes, this junk is junk. No normal human being wants one of these:





These are pieces of shit.

it was an ugly abnormality but people bought them. I've seen more recently thant in the last 6 yrs.

god are they ugly but ya can carry a shit load of stuff.

anymore questions?

the Aztek went out of production in 2005. Strangely enough they do attract the tree-hugger crowd, Lord knows why.

i think it`s to big and the design is way to severe. of all the throwbacks i like the dodge the best. i`d sell my house if they would make a first or second generation trans am or gto....

they are the same except for power plants and some glass. Not much different, except a few curves.

Only a few per dealer, but they seem to be out there.