By Peter M. De Lorenzo
Detroit. I started out writing this week’s column with a somewhat gentle – for me – tone, but that didn’t last. I stopped cold in my tracks because at this very moment there is not one thing remotely funny about the auto biz. Why? Well, a number of reasons, actually.
For one thing the Grand Slowdown is upon us, and despite the auto companies insisting that they have it together, that they will be out in front of it and that they’ll be able to “manage” their way through it, there are sure signs that’s not the case. It’s not hard to see how it all comes apart, either. Company executives get itchy, and the contemporary auto speak of “we take the long view” and “we don’t dwell on 30-day increments anymore” goes right out the window as battle lines are drawn and the “incentive dump” game is played out in ruthless fashion.
It’s a game of balancing the downward spiral, which means monitoring production vs. inventory, and trying to retain market share while trying not to give the product away. It’s not a dance for the faint of heart, that’s for sure. Some companies seem to have a handle on it; you can see Ford making moves now, temporarily shutting production down to keep the inventory aligned with the sell rate. And others, well, others just sort of wing it, like FCA, which is just stopping short of giving away its pickup trucks. Then again, that’s standard operating procedure for FCA. The company wings it and plays loosey-goosey with the facts, figures and numbers, taking their marching orders from their Esteemed Leader who is, of course, comfortable operating in that smoke-and-mirrors realm. Knowing his M.O., I’m sure a “$20,000 Off Sale!” of Ram pickups is imminent. (But hey, Sergio is going to unveil an Alfa Romeo crossover at the L.A. Auto Show, so it’s all good, right? Wrong.)
And, as I mentioned in last week’s column, despite the looming seismic shifts that allege a positive direction, complete with a hovering miasma of Sweetness and Light, this business will still have its conniving and calculating charlatans, those parasites and bloodsuckers of the New Electrification Age who are destined to leave a trail of tears and broken promises in their wake.
And unremarkably enough, we didn’t have long to wait for the latest evidence of it, starting with “St. Elon” Musk. Despite the fact that Musk has mentally moved on to growing potatoes on Mars, Tesla had the temerity to announce that its much-hyped Model 3 will become available in mid-2018. The guffaws when that news was announced drowned out any residual hype-blather from the company’s comically lame PR troops, as the likelihood of a Model 3 seeing the light of day before 2020 is slim. And none.
But of course this “news” was dutifully reported by the assembled multitudes in what passes for the automotive media these days, only this time with a noted tone of “yeah, right” discernible between the lines of copy offered by some of the sharper carpal-tunnel-tinged wretches out there. Still, the idea that we’ll have to endure what passes for “news” from Tesla that will emerge in dribs and drabs for the next three years is a notion that’s almost beyond excruciating.
Fortunately, the brace of electric vehicles from the mainstream automobile manufacturers – you know, the ones that can actually manufacture quality vehicles in volume with real operating doors – poised to storm the market in the interim is sure to relegate Tesla to being a marginal player in Afterthought Land. That will be a truly happy day, although by then few people will even notice. As I said previously, Tesla is destined to become the Morgan of the 21st Century, minus the charm and the accrued goodwill.
And speaking of reality-challenged executives, there’s Dieter Zetsche, the smug, arrogant leader* of Daimler, who recently stated in interviews that he is absolutely confident that Mercedes-Benz will be the leader in electrification just as it has been the leader in everything else (at least in their own minds). And he will be the Exalted Emperor of Daimler’s “reinvention” that will play out over the next 10 years. Zetsche’s big idea? He will break down the silos and get the best thinking in the company. And this passes for news from the Daimler Empire? Kind of pathetic when you really think about it.
(*By the way Zetsche was never the jovial, warm leader that everybody thought he was during his stint in Auburn Hills as the CEO of DaimlerChrysler. That was a carefully crafted persona created by his image-wranglers back then, and he’s still dining on it to this day.)
Whether or not Mercedes-Benz ends up as the “leader” in electrification remains to be seen, but when I see boneheaded marketing moves such as Mercedes handing its compact GLA crossover to Carlos “I’m the next G.O.A.T” Ghosn so it can be rebadged as the Infiniti QX30, I have to wonder if these two self-righteous, relentlessly tedious blowhards and self-appointed legends of the car business have a clue as to what they’re doing. Oh, that’s right, their whims and wishes and will transcend any basic marketing realities. Ha. Where have we seen this before, eh, Sergio?
There is a fundamental condescension aimed at consumers on display here that is simply mind-boggling. What Zetsche and Ghosn are saying is that they can play the badge engineering game to their edification – and profitability – and they can do it with impunity because the average consumer out there is too stupid to know the difference. Yeah, every car company does it, but wow. Arrogance personified? Check. Unctuous Prick Hall of Fame? Check. (This – see below - makes GM’s badge engineering shenanigans among nameplates at its low point back in the day seem downright uplifting in comparison.)
The Mercedes-Benz GLA250 4MATIC.
The Infiniti QX30.
That Carlos Ghosn is involved in this marketing train wreck should really be no surprise. This guy has had dreams of becoming the King of the Automotive World for going on two decades now. He runs Renault-Nissan and now he’s going to be chairman of Mitsubishi too, with promises of resurrection of that desultory brand already flying. The guy just oozes condescension and considers everyone to be below his station and mental capacity. What is with these honchos in the automotive industry? Can’t they be content with doing a good job and let the praise accrue over time, instead of chomping through the scenery like petulant 6-year-olds? Apparently not, especially when such tedious “role models” like The Great Sergio are allowed to run rampant over the landscape and be praised as “visionaries.” What a bunch of unmitigated bullshit.
Then there’s VW’s Matthias Mueller. When he ran Porsche this guy was the very personification of an Unctuous Prick, one who could barely contain his seething disdain for just about anyone within range of him, especially the media whom he treated like annoying insects that buzzed him with stupid questions and needed to be swatted away. Plucked from the cushy confines of running Porsche and thrust into the role of running the German monolith VW, Mueller has been in a Shit Storm of gargantuan proportions since the moment he took the reins of the company due to the VW diesel debacle. He is now having to deal with the fallout and has announced that the company will have to endure a series of painful cost cuts over the next few years.
Now let’s get something straight right from the start here. German car companies don’t do cost cutting very well. They’ve been on such a steamrolling roll for so long now - printing boatloads of cash along the way – that even the words “cost cut” are anathema to them. Actually they are words that few executives within the VW Empire are even familiar with. Remember, this is the company that saw one of its star divisions – Audi – dominate the 24 Hours of Le Mans for fifteen years. But when its other and arguably bigger star division – Porsche - decided to return to compete at the world's most prestigious endurance race, instead of telling Audi to stand down, the company allowed both divisions to slug it out against each other, to the tune of $150 million per year, each. So cost cutting is going to be a bitter, painful pill for the VW Group. And it couldn’t happen to a more deserving executive than Mueller, who, instead of parading around receiving the huzzahs that the Supreme Leader of the VW Group would normally get, has to now carry out a depressing, soul-crushing, cost-cutting imperative. As we like to say around here: Boo. Frickin’. Hoo.
Then there’s Mary Barra. Maybe she can rise above all of this industry mediocrity. Then again, maybe not.
In the latest “4 Minute Read” in Fast Company, that hipper-than-thou publication that has raised the art of self-indulgence and vacuousness to a new level, the GM management team – led by Barra - is presented as a group that is a shining beacon of hope in a business that is in desperate need of it. Dutifully orchestrated by the operatives at GM PR, the thankfully short and delightfully puffy puff piece - after all, it’s supposed to only take “4 minutes” – is filled with happy times and good vibes.
In it, Barra says, “I don’t pretend to have all the answers.” Instead she leans on president Dan “I Am” Ammann, global product chief Mark Reuss and CFO Chuck Stevens. "I run the group, but I want everyone’s best ideas. We need a diverse team with many different kinds of experience,” Barra continued. “In such a complex business, we will make better decisions if we bring our different points of view and the different ways we think."
That all sounds promising, noble even, but why is Barra and the rest of GM’s management team – who allegedly have it goin’ on – so averse to having a properly governed marketing function within the company? With Barra being orchestra conductor, Ammann the operations guy, Reuss the product guru and Stevens the finance guy, the fact that there isn’t a fifth person in the executive suite with the responsibility of marketing and image wrangling for the company is a complete travesty.
This is a different kind of arrogance and condescension from that practiced by the previously mentioned rogue’s gallery of self-indulgent bad actors. It’s a calculated arrogance that revolves around the fact that the company’s image - and the image projected by its divisions - isn’t a priority or important enough, certainly not enough to add a million-dollar body to the well-oiled Gang of Four.
Think about that for a moment. The company’s image and the projected images of its divisions isn’t important or “big” enough. If the image-wrangling business was handled properly by inertia – which seems to be the preferred way of handling things down at the Silver Silos – I could see their point. But the company’s image wrangling is piss-poor, and the marketing by its divisions is rampantly ineffective if not borderline tedious, to the degree that its products – which under Reuss’s tutelage are for the most part excellent and extremely competitive – have to rise above the tepid marketing and sell themselves.
I will believe that the “old” siloed GM is a thing of the past and that it truly is a new day for the company when and if Barra starts taking the role of image wrangling and marketing seriously.
Until that happens, I will reserve a special place in the Rogue’s Gallery just for her.
And that’s the High-Octane Truth for this week.
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