Friday, March 17, 2006
From Dealer Magazine and my friend Jim Ziegler:
THE CROWD HAS MOVED ON
"My February article, Return to Skull Island, which I thought a masterpiece, was written a few days before the January 10th announcement of General Motors' value promise pricing initiative, which, if you'll recall, I predicted was going to be another 'silly-ass' inane price-cutting scheme. These guys are so predictable.
Maybe I'm a little confused here. One of the reasons General Motors is in trouble is because it can't meet its "legacy debt" obligations. It has got all of these "blood-sucking retirees" dragging them down.
OK...OK...let's talk about 'blood-suckers' for a moment. Now remember, I'm just a high-school graduate from the bad side of Jacksonville. But, I've been reading The New York Times and Reuters about how Rick Wagoner has gotten himself set up to receive a $4.6 million retirement package that is separate and exempt from the under-funded GM employee retirement plan. By the way, that's nearly twice what he's now making. The New York Post actually called Wagoner 'the greediest, most undeserving CEO since Chainsaw Al Dunlap.'
Wagoner's 'golden parachute' comes from an accounting legal device sleight-of-hand called the Supplemental Executive Retirement Plan, a fund that is exempt if GM declares bankruptcy.
According to The Post, the General Motors pension fund is under-funded by more than $45 billion. But Wagoner will skate free in the event of a bankruptcy and still receive his multi-million-dollar pension even though the retirees who sweated blood for their entire productive lives would be totally screwed and destitute.
Now, I'm not going to call Rick Wagoner names. That wouldn't be fair. I would prefer to let his profitability track record speak for itself and then allow you to make your own educated decision.
Personally, I think Wagoner should be ashamed. But, instead, he's still attending his black-tie cocktail parties and making speeches. How can anyone continue a charade of honorability and decency knowing what he's done? He's so far into the stratosphere from where the rest of us normal people live. He can no longer relate to us or his customers. This man is worthy of my highest personal ridicule and contempt but he just doesn't get it. Of course, this is all just my personal opinion based upon what I'm reading in The Times, The Post, and Reuters. I might be wrong.
I am writing this on February 4 hoping Wagoner isnt lined up before a firing squad before this gets to press in March."
"Of course, it seems to have become a commonplace trend for these 'Ivory Tower' prima-donnas to leave the company in shambles and ride off in the sunset with the family jewels'a la Jacques Nasser. In the case of the recently bankrupt Delphi Corporation--although, the workers are near-rioting over pay and benefit cuts and threatening to strike--it seems that CEO J.T. Battenberg has also lined himself up with one of those Rick Wagoner deals. Battenberg gets a $1.6 million annual retirement package exempt from the bankruptcy.
All of this is sort of reminiscent of Marie Antoinette saying...'Let them eat cake.'
(You know, I should have seen it coming. Months ago, perhaps as early as last May, I began writing and speaking about how General Motors was advertising on Edmunds.com.)
Heres the biggest sellout of the entire equation. When the announcement was made to cut margins, there was also a tie-in to the General's new marketing strategy with Edmunds. This sellout of its dealers has been in motion for many months...it's not as recent as you might think.
I was just reading some literature on Edmunds.com from the editors of Edmunds titled, The Truth Behind Dealer Holdback. It is an article educating consumers that they should use the dealer holdback in their negotiating. There is a chart showing exactly how much percentage of holdback each manufacturer has in their invoice&and another chart showing current dealer cash allowances for every make and model&and what stair-step incentives the dealer might qualify for.
In other words, as I have said repeatedly, Edmunds.com is the most anti-dealer (probably communist) web site in the entire known universe (my personal opinion based on knowing a snake when I see it). And now, here we have General Motors heavily supporting it financially. This just ain't right!
I am convinced that all of this misguided 'transactional pricing' crap that Mark LaNeve and the other alleged corporate zombies are spouting is coming directly from Edmunds.com. The bottom line is that Edmunds.com has positioned itself as the new industry leader in consumer research that the manufacturers are listening to. It seems as if Edmunds is rapidly replacing J.D. Power and Associates as the go-to source for consumer information.
Here's the Ziegler take on all of this: Conceivably, these people at Edmunds might be raving idiots, granola-eating car liberals, and card-carrying morons...but...of course, I will have to wait and reserve judgment. Let's see if General Motors continues to dive deeper into the toilet guided by its advice and advertising before I make a conclusive statement. I am taking bets.
Cracking up now...a Ford dealer told me this one. I'm sure everyone is aware that General Motors is celebrating beating Ford in car sales last year. Well, my dealer friend said that Ford Motor Company getting beaten by General Motors in car sales was like getting sand kicked in your face by a chemo patient.
You know I do business as a trainer and consultant for a lot of Toyota dealers. Month after month, I receive a lot of e-mails and phone calls asking why I don't write more about Toyota. Well, I gotta tell ya. The truth of the matter is there aren't a lot of negative things to say about Toyota.
Recently, Mark LaNeve at GM was quoted as blaming all of GM's recent failures on hurricanes, the war in Iraq, oil prices and interest rates. You know, I didn't see any negative quotes by Jim Press at Toyota. His company was gaining market share during the same times with the same economic hardships that LaNeve was whining about."
Well said Mr Ziegler, thanks for helping to carry the torch!