The Indictment of G Richard Wagoner (2)
Thursday, June 8, 2006
Statement of the Case
"Rick" Wagoner, at 39 years of age, became Chief Financial Officer of the General Motors Corporation in 1992.
Mr. Wagoner was promoted to head of North American Operations in 1994.
In 2000, he was elevated to Chief Executive Officer.
Upon the retirement of "Jack" Smith, the "fast track" was completed and the heir apparent assumed his current Chairman of the Board position.
During the past FOURTEEN YEARS, this man has been a central figure in the hierarcy of GM management. He has undoubtedly been critically involved in the stategic planning of GM, and additionally has acted repeatedly, even methodically, in it's implementation. That strategy is built upon a goal of significantly reduced headcount in US operations, as well as a coordinated effort to eliminate franchised dealers thereby enabling eventual factory owned distribution channels.
This architect refuses to reveal his blueprint, and has deliberately deceived investors, employees, dealers, and customers. While selling off assets, closing divisions and retail outlets, laying off and paying off thousands of employees, Mr Wagoner has continued the misguided tradition at GM of empty promises and meaningless commitments. Earnings guidances have been withheld, financial statements revealed as improper, credit ratings have sunk well into "junk", long term debt has risen tremendously, losses have grown, and market valuation destroyed.
Under the direction of Mr Wagoner, failed members of management have simply been moved to "special assignment". There is a serious lack of accountability at General Motors, even to the point of Mr Wagoner giving himself a bankruptcy proof pension.
Let's ask ourselves the following:
Why did Oldsmobile go out of business? Was it that poorly managed, or closed intentionally?
Why has Buick been starved of product in spite of promised billions for product development?
Why are Buick dealers being "channeled" into combining with other GM franchised operations?
Why do we have a Jobs Bank, paying employees to do nothing while we employ contracted personnel and pay overtime to different workers?
Why do we continue to close our most efficient and highest quality plants?
Why do we claim to have a price cut while only truly cutting the dealer margin?
Why do we create a VEBA structure to handle expenses for health care, and pay the UAW to administer the program?
A few years ago Mr Wagoner issued a mid-decade earnings projection of $10 per share. When the time arrived and he was questioned as to his failed forecast, the man had the audacity to reply that "It depended on how you define mid-decade". Last year the shareholders of this company lost almost $20 per share. Yet this man remains in place and has received a vote of confidence from the Board.
Again, ask yourself WHY ???
This brings us to the List of Players and Statement of Facts.......