Barbarians at GM's Gate?

October 12, 2005
Driving into Detroit's gleaming Renaissance Center last night, I couldn't help but admire the work General Motors has done since taking over the long-troubled riverfront skyscraper nearly a decade ago. Today, after a billion or so dollars spent sprucing up the seven-tower complex, it's worthy of being the global headquarters of the world's largest automaker. And last night should have been the night when GM could proudly show off its effort and boast about its leadership. It was, after all, the night when former Chairman John F. "Jack" Smith was due to be inducted into the Automotive Hall of Fame, no small honor, placing him alongside the likes of industry pioneers like Henry Ford I and Billy Durant.

So why did the honoree nervously back away when a few hail-fellow hacks -- including TCC's publisher -- approached him -- Smith's eye's darting about as if trying to memorize every possible exit from the vast ballroom? "Thanks, uh, thanks," he mumbled, when congratulations were offered, before slipping into the crowd. Smith's successor and current GM CEO, Rick Wagoner, was only a little less hesitant when he spotted the media hordes. "No questions, nope, no questions," he immediately declared, backing down only when asked about his deserving predecessor. "He played an enormous role in the history of the biggest organization in the industry," Wagoner explained.

There were more than a few folks on hand last night quietly questioning the timing of Smith's ascension into the ranks of automotive history. No question he led the turnaround after GM's brush with bankruptcy in 1992. But Smith was also the chairman who put the ill-equipped Ron Zarrella in charge of North American operations, and the pain has been peeling off Smith's so-called Global Alliance strategy lately. There's the disastrous divorce with Fiat, for example, and the sell-off of GM's share in Fuji, for example. And Smith's clear disinterest in product is something that cost the giant automaker dearly in terms of lost market share.

So, on second thought, maybe there was good reason why neither Smith nor Wagoner were open to pleasant chatter with the scribes on hand last night.

But Jim Press was certainly in a chipper mood. The top-ranked American executive with Toyota was there in the RenCen, along with another half-dozen top Toyota execs, for the induction of Jim Moran. The former Big Three dealer became one of Toyota's best retailers, eventually setting up the huge, family-owned firm that controls the maker's distribution in much of the South.

Barbarians at the Gate? Press only laughed when asked if he was looking for a bargain lease on the Renaissance Center. Yet among the many wild rumors floating around in industry circles these days is the idea that Toyota might actually move to Detroit. Press has told TheCarConnection that Toyota continues discussing the idea of a new Michigan assembly plant. Rumors aside, the sharp contrast in the mood of the GM and Toyota executives on hand last night was a clear indication of how things are going in the U.S. auto industry these days. GM may be king-of-the-hill, but the interlopers who boldly strode into the RenCen last night seem increasingly confident they can topple the struggling giant and plant their own flag wherever they want.

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