Lutz: GM "Missed Boat" On Hybrids: Dismisses Them As Advertising Expense

[hatrack]

"General Motors Vice Chairman Robert Lutz said the automaker missed an opportunity to market itself as a technologically savvy company capable of producing hybrid vehicles.

Lutz said GM "missed the boat" on a marketing opportunity with hybrids -- an opportunity Toyota Motor Corp. has played to its advantage. "We business-cased it, took a hard, analytical look and thought the engineering and investment were irresponsible vis-a-vis our shareholders," he said. "We failed to appreciate what Toyota has basically treated as an advertising expense."

Lutz said GM was doubtful the business case for hybrids would work.

In hindsight, "we should have said, 'We'll lose $100 million a year on hybrids, but we'll take our advertising budget of $3 billion, make it $2.9 billion and treat it as an advertising expense,' " he said. While Lutz said he finds it hard to view product as a form of advertising, "Toyota very cleverly has used hybrids to gain an improved perception of the brand."

EDIT

http://www.mixedpower.com/modules.php?name=News&file=article&sid=310

[aden_nak]

1. "Slow, Sturborn Maker of Mediocre Automobiles Screws Up Again."

I should be allowed to re-write the headlines for the papers just one day per month.

[buddysmellgood]

2. You should apply to the Onion

[aden_nak]

4. It just galls me.

"Looking back at someone else's success, I can see how easy it would have been to do that. The only reason we didn't was because of accounting procedures."

Yeah, that, or your entire business model is driven by the desire to move backwards instead of invest in new technology. Either or.

[PROGRESSIVE1]

3. I would not feel bad if the BIG 3 (GM, Ford, Chrysler) went out of....

business. I'd feel bad that the Corvette would no longer be made and the fact that thousands of workers would be unemployed, but I don't feel that American Car Makers really want to be making good cars anymore (Greedy Right Wing Executives are to blame for this). Japan has earned their position as king of Car Manufacturers!

[aden_nak]

5. The vast majority of "foreign" cars are made in the US now.

In fact, Chevy and Toyota share manufacturing plants. Under the chasis, for example, the Corolla is absolutely identical to one of Chevy's four door compacts. It's actually the only truly reliable Chevy on the road because they essentially are just using Toyota's design.

Japanese auto manufacturers figured out a long time ago that the cost of manufacturing here in the US, while not ideal from the view of the "old" business model, works better for them in the long run. Hear that GM? "IN THE LONG RUN".

[midnight armadillo]

15. You don't really want one of them to go under

That would basically shatter the US economy. Really, they're too big...

[htuttle]

17. No more corporate bailouts for the Big Three!

Nobody is 'too big to collapse'. If General Motors is THAT critical to the US economy, perhaps a more responsible move would be to simply nationalize it.

If a corporation is critical enough to subsidize, then it's critical enough to nationalize.

[Demit]

6. They "business-cased" it. That's why their cars look like they do,

they're all too afraid to have any vision. "Business-case" it, don't dare to do any creative thinking, stick with the status quo. Use your responsibilty to the shareholders as an excuse. Collect your millions as a CEO. Watch other countries innovate and forge ahead, then say "oops, we should have..." But you've still got your own millions safely tucked away.

[suziedemocrat]

18. It sometimes seems like the stock market is to blame for all our problems.

[Coastie for Truth]

7. That has been GM's policy all along -

but they sure wasted a lot of money and lost a lot of good will with their "frivolous lawsuits" against Sumitomo on electric motor components, and against Toyota and Toshiba (and through Toshiba against the cell phone and laptop industries) on metal hydride batteries.

I always wondered about a consumer capital goods manufacturer whose Directors of Product Safety Engineering and Environmental Engineering had their doctorates in LAW (Juris Doctor).

If they took the money that they waste on frivolous law suits and spent it on product Engineering they would have a world beater hybrid.

[aden_nak]

8. Suing over patent rights is the death throws of any giant company.

Because it signifies the point that their product has become so flawed or undesirable, that the only way to gain revenue is to attempt to pilfer it from the accomplishments of others. Usually their "upstart" rivals.

[Coastie for Truth]

11. The truth is

1. The Sumitomo Law Suit - The technology was flawed (never worked), one of GM's patents was declared invalid, and GM lost another law suit.

2. The Metal Hydride Battery patents - GM's settlement gave them the right to do a "Geo Prism" type arrangement on any Toyota hybrid product. So, they got well "well engineered" engineering - with out doing the engineering. My concern is that they will screw it up - like they did with the Corvair and the Olds diesel.

[aden_nak]

12. Why be concerned?

If their hybrid is a piece of crap, it will fail, while Toyota and Honda succeed. And before any of our freeptastic lurkers tries to misquote that as me being "Anti-American", consider instead that it's just reality. I mean, isn't that the very spirit of Economic Darwinism and capitalism itself? The company that makes the best product and offers it at the best price will thrive. Right?

[Coastie for Truth]

13. I am concerned for two reasons

1. The ultimate price for management incompetence is paid by the American worker. The CEO gets his mega-bucks -- and the worker gets laid off. I saw Michael Moore's "Roger and Me" as part of a double feature with "Tucker" at a mom-and-pop neighborhood theatre in Ferndale MI. The folks there knew that they (the employees) pay the price for guys like Lutz.

I saw it in steel - where the Japanese and the Europeans were two technological generations ahead of the US. The US companies looked for tariffs and bail outs -- our trading partners looked for oxygen furnaces and continuous casting. :(

2. General Motors' policy - as shown by the Sumitomo and Metal Hydride law suits has a chilling effect on their hyper cautious domestic competition. Looking at the alternative and renewable energy field - it is perfectly clear that GM's intellectual property policies delayed Ford's hybrids for two years - at least.

I applaud Toyota for their "screw you --- sue me" approach toward GM.

I have been a Michael Moore fan since I saw that Michael was "telling it like it is in Roger And Me." (I actually think he pulled his punches a bit in Roger And Me on what GM did to local schools in its company towns - but that's really off-point and Michigan arcania)

(Not only am I a Michael Moore fan - I am also an Ed Schultz fan. I am what is known as a Gun tottin', meat eatin' leftie and a "Gear Head")

[farmbo]

9. What year is this...1973?

Will these morans ever learn?

Hybrids (high mileage vehicles) are nothing more than an "advertising expense", and have no merits on their own, so we'll let Toyota lead the charge...and gain a permanent technological edge.

If they had set out to deliberately diminish GM stock prices in the long run, they could not have done a more effective job.

But in BushWorld, failure IS an option.

[madrchsod]

10. toyota very cleverly...i think he meant

"those little clever yellow slant eyed bastards fucked us again" but i could be wrong..maybe he didn`t mean that. ya lutz you guys are fucked. toyota is on their second generation of power plants you you guys got nothing. while you guys keep designing cars and trucks that rely on gasoline only power the rest of the world will be buying or developing hybrid gasoline-refined oils/ electric power plants. another technology that the american worker will loose jobs to. ya,we should be making them but they ill be made overseas...

[freethought]

14. Ah yes! "Enhancing Shareholder Value"

I wonder how 'enhanced' Toyota shareholders are right now? What's the waiting time for a Prius? Six months to a year? Imagine GM, Ford, or Chrysler having a one year backlog of car orders.
Mr. Lutz you are truly visionless!

The Big Three can officially bite me!

[hunter]

16. The "Big Two." Your Chrysler is a Mercedes.

G.M. and Ford are something else... Look around. Automobiles are not their primary business anymore. Mostly trucks and "SUVs" it seems.

[Maestro]

19. And yet another executive at GM says this

<snip>

Fossil fuels to power our favourite form of transport, the automobile will soon be a thing of the past according to Vice President of research and development at G.M, Larry Burns, who claims that although currently prohibitively expensive, by 2010, hydrogen powered cars could be in mass production.

<snip>

http://www.earthtimes.org/articles/show/1166.html

So by 2010 GM will have retooled? I'll believe when I see it. And isn't the production of hydrogen dirty?