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Lutz on his product legacy: 'Good enough' isn't enough

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Lutz on his product legacy: 'Good enough' isn't enough

Automotive News
February 9, 2009 - 4:08 pm ET

Bob Lutz, General Motors' vice chairman of product development, spoke to Automotive News Staff Reporter Jamie LaReau today after GM announced Lutz will retire this year at the age of 77. Edited excerpts:

Was this your call to retire?

Absolutely. I've been talking to Rick (GM CEO Wagoner) about it since last fall, and you work harder and harder, and it's tougher and tougher to achieve results. If I were 10 years younger, I'd tell myself: This is a three- or four-year rough patch; we'll come through it; and at the other end there'd be pleasure and satisfaction, and it'd be enjoyable again. But I won't be here three or four more years now.

How much did last year's Congressional hearings and the negative backlash GM received play into your decision to retire, especially the federal oversight and salary regulations?

I don't think any of that was the trigger per se, but clearly when you find the business becoming tougher and tougher with less and less job satisfaction and more and more agony and reduced compensation, at some point the cumulative effect does help you make the decision.

You had said you wanted to stay on at GM to at least see the launch of the Chevy Volt plug-in hybrid in 2010. Why the change of heart, given the importance of the Volt to you?

That was the intent at the time. First of all, it's well on track. We will be driving finished Volts this summer because we'll have a lot of them through the tail end of this year and next year. So in terms of low-volume production, we'll be producing them, we just won't be selling them. As far as I'm concerned, the Volt is done.

The Volt is a very environmentally friendly product that you championed, yet you've also made it clear that your personal view is that global warming is a myth. Can you speak to that dichotomy?

See me on January 1, 2010. At that point, I will be a private citizen and free to express my opinions.

What are the three GM vehicles you're most proud of?

I'd say probably the new Malibu, [Cadillac] CTS and the new global mid-sized car architecture: Opel Insignia. It's finally the onset of our transition to global architecture. That car was conceived in Europe by an international team and is being produced in China and Germany at the same time. The new Buick LaCrosse is a variant of that architecture with the same engineering team having executed it, although they are totally different.

People say you did the Pontiac GTO and that didn't sell very well, but yet I am tremendously proud of it. That's the car that got us convinced that we could use the global product development scheme. Up until then, no one had tried anything like that. The work on the GTO with Australia forged an important bond and got us to unify everything: common processes and common testing. I am proud to say that was my initiative. That's my proudest accomplishment.

What have you done to change GM institutionally -- the processes and the procedures -- during the last eight years?

The two key things were the globalization of product development and the recognition of design as the most important factor affecting consumer choice and elevating design to its appropriate role in the company. It had been somewhat neglected over time.

Today there is a shared belief that world-class, best-in-class product is the only way you can win. As Fritz Henderson said to me this morning: "You know, you ought to write another book and call it: Good Enough is Woefully Inadequate." If I do write another book I will call it that because that summarizes my viewpoint.

Are you going to write another book?

Well, I don't know. It depends if I can find a good co-writer.

GM is surviving right now on taxpayer dollars. Will it survive?

You're asking me to look deep into a personal crystal ball. It all depends on the development of the general economy. If things stay the way they are, that's a very gloomy outlook, and if things get worse, than all bets are off. And all bets are off for everybody, not just GM. You saw the Toyota loss for the year: close to $4 billion. Imagine their rate of losing money because they were plus $14 billion or $15 billion in the second or third quarter. So their rate of burn is about $8 billion to $9 billion a year. At that rate, they'll be out of money, too. So my point is it isn't just GM, Ford and Chrysler. I have absolute confidence that General Motors has more and better technology to meet these challenges, and my firm conviction is that GM will come through this. When we come out the other end, we'll be a leaner and faster company, and we will have gotten rid of the legacy costs.

And will GM have fewer brands, too?

Oh, sure. You know what we're doing to try to focus on fewer brands, and I'm convinced we'll have fewer brands.
 

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