The “Godfathers” of Detroit are concerned (Quick…Somebody cue the violins!)

When the CEOs of the Big Three automakers were asked yesterday how they reconciled asking for $25 Billion when they EACH traveled to Washington D.C. on their corporate jets, the answers were astounding. Forget, for a moment, the environmental waste here. God forbid these guys pool resources for fear of divulging corporate secrets via mental osmosis or “Vulcan mind meld.” What’s equally astonishing to me is that the corporate flights are listed by the press as ONLY costing $20k. Huh? I suspect someone at the AP has not checked all their facts. The fuel, air strip access costs, and proportional salaries for the pilots and ground crews surely add to more than that. By comparison, seats on Northwest Airlines flight 2364 from Detroit to Washington were going online for $288 coach and $837 first class. But we can’t expect corporate executives to fly public transportation, can we?

“It’s corporate policy that officers travel on private aircraft,” says Ford CEO Alan Mulally. Reality Check: In the past year, I’ve see the likes of NBA’s Eddie House (Eddie was on a flight with my wife & I not even a week after his team, the Boston Celtics, won an NBA title), HBO’s Doug Gray, and ESPN’s Chris Berman all flying public transportation. Heck, I even caught Coolio on a Southwest Airlines flight! If these guys, who are infinitely more recognizable than Mulally, can fly public aircraft then so should he.

“We don’t fly on public transportation because we’re concerned about security,” said one of the Big Three staffers. Excuse me? When did the security of a corporate CEO become tantamount to protecting a Mafia Don? Perhaps these guys are trying to bump one another off literally?—and not just in the marketplace? Raise your hand if you would even recognize Ford CEO Mulally or GM CEO Rick Wagoner if you saw one of them with a T-shirt with “Corporate CEO” on the front. I thought not. Talk about a superiority complex!

Tell you what guys, the American people should consider loaning your companies money when you’ve proven capable of managing a budget. How about some humility? How about recognizing that your business model of 20,000+ dealerships is bloated—GM has almost 7,500 franchised dealerships alone. By comparison, Toyota has about 1200. Even Starbucks, which had some 8,000 stores back in 2004 and plans for 25,000 shops worldwide had to curtail its plans and close over 500 shops over the past year. Not everyone can regularly afford a five dollar cup of coffee, same as not everyone can afford the $100k ZR1 Corvette. Now I recognize there are certainly more jobs at stake at GM than at Starbucks, but GM’s overhead from agreements with the UAW and its own compensation model each need a major overhaul. Speaking of GM, their quality has certainly improved over the years, but the diversity of their products has not. We’re still waiting for the Chevy Volt—the car that promises 40 miles on electricity alone—but it won’t be on the road until 2010. Dear GM: You might need to consider adjusting your time table if you want to keep the doors open! Meanwhile, with gas prices falling to “reasonable” (albeit temporary) levels, don’t expect the Big Three to take much focus off the gas-guzzling behemoths that are their principle profit centers.

Yes, something does need to be done for the American automotive industry. President-Elect Obama has already indicated that he will work to provide assistance. All I have to say is there better be a whole LOT of strings attached. This just in: Congress agrees with me and has set a deadline of December 2nd for the Big Three to submit proposals on how they would spend the money. I suppose that’s a start. I think Congress need to be hard-nosed on this one. The deal should be worked out the way dealerships sell cars. Picture the CEOs sitting in an office in the White House sweating over how much their companies get, while Chief of Staff Rahm Emanuel runs to the back room and emerges with several hundred pages of legal papers indicating all of the stipulations of the deal. Most likely it will include the government getting a preferred stake and control in decisions. Like GM’s own Saturn model, there should be NO negotiation. The deal is what it is. Now that would be poetic justice!

Peace,
+THINKER