Congress is taking a hard look at Detroit’s autos these days. But what about Detroit’s jets?
When the chief executives of Ford and General Motors flew in to Washington yesterday to ask Congress for a $25 billion lifeline, they didn’t fly coach.
General Motors CEO Rick Wagoner arrived on his company’s cushy Gulfstream IV, ABC News reported. Ford CEO Alan Mulally flew in on a private company jet as well.
It costs about $20,000 to fly one of these jets round trip from Detroit to Chicago — far more than the $900 cost of a first-class ticket on Northwest Airlines, ABC said.
Wagoner told ABC he took the private jet because he’s a busy guy. Mulally declined to comment.
It’s not exactly news that corporate fat cats prefer to fly in style. And assuming all eight seats on the G4 were taken, the private jet only cost about $13,000 more than flying commercial.
But it might not be the best move by Big Auto as it tries to convince Congress that a $25 billion bailout would be money well spent. The two have already been criticized for their generous pay packages ($22 million for Mulally in 2007, $15.7 million for Wagoner).
What do you think? Is this a tempest in a teapot, or further evidence of Detroit’s poor business practices?
For more Reuters political news, click here.
Photo: REUTERS/Kevin Lamarque (Auto industry leaders testify in Senate on Nov. 18)
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The auto spokespeople try to argue that commercial airline travel is too insecure. Bogus..certain celebrities do this and they are far more recognizable than these guys. These execs are so out of touch, that they couldn’t imagine being in the vicinity of “the people”..even first-class people.
The bailed-out banks are probably no different, but they own the media so don’t expect to see those headlines.
- Posted by AJ WrightScott, many disagree with you. This really is much more than “minor stuff.” Leading by example is a large part of character. Wagoner’s compensation package includes a base pay of $3.36 million. The moment he and the boys announce that they will substantially cut their pay as a start to GM’s financial viability is the moment I and others might begin to back thier plea and plan.
- Posted by russPrivate jets are a fact of life for highly paid and busy individuals. But why not consider a couple of options instead of bailing out the auto industry. Lower tax rates to 5%, 10%, 15%, 25%, 30%,and 35%. Then drop welfare so everyone works for there check, but increase grants for non-profit orgs that make an impact for those groups. Follow that up by increasing taxes on the entertainment industry, which pays multi-million dollar contracts for throwing a ball around or staring in a movie. I would definitely still play professional basketball if I only made 100k per year. Now there is a stimulus package.
- Posted by StreaminJAMartha Keats: “greedy arrogant bloated white guys”
- Posted by JordanYou might want to rethink your wording. As is this comment could easily be construed as racist.
OK–to those of you citing “safety” and keeping the “paps” away–when is the last time the paps chased down the CEO of Ford for a candid? Answer: never. As for safety, if commercial airlines are not “safe” why is anyone flying? These guys are not celebrities nor are they targets for violence…they should fly commercial like the rest of us peasants.
- Posted by RoxAs elitist as flying in private jets sounds, Scott is correct! Pilots, ground crews, fueling personnel, etc. jobs depend on these corporate jets being used. My father was corporate pilot when I was growing up. I can not count how many times we had to move for my father to take another job because when a business begins to hurt financially, the aircraft is the first to go. Everything always rolls down hill hurting everyone!
- Posted by leslieThis is no tempest in a teapot. This is politics/governing American style that is fast going out of style. See London Review of Books, http://www.lrb.co.uk/v30/n21/mish01_.htm l. So yesterday.
- Posted by larryReal minor stuff, funny but not material
- Posted by ScottIsn’t that about the same as someone paying with foodstamps and then packing groceries in a Cadillac? Maybe people can stop just looking at the Auto Makers in this situation and realize it also happens in your town just at a lower level.
- Posted by PatrickJOIN THE CHAPTER 11 CLUB, BOYS. THESE BUSINESSES ARE BADLY IN NEED OF TOTAL REORGANIZATON!
- Posted by John H Lindop[...] Yes, you guessed it! Expensive corporate jets! General Motors CEO Rick Wagoner arrived on his comany’s cushy Gulfstream IV, ABC News reported. Ford CEO Alan Mulally flew in on a private company jet as well. ~ Reuters [...]
- Posted by Appearances | Freedom Of BlogThis is sick! Those three guys must be fired before the senate can even considet a bailout package.
- Posted by Oscar[...] It looks like someone’s PR folks are sleeping on the job, as the CEO’s of the big three automakers flew in to DC all on their own seperate private jets. [...]
- Posted by Auto CEO’s fly private jets to beg for public money : StanfordLiberty.comI agree with “Tarro”. Give them money, make them restructure (which includes getting rid of current CEO’s or making their pay depend on how well the company does). The whole thing about fat cats flying is silly thing to cry about in capitalist society. If they are getting paid as much as they do, you do really want them to fly private so they don’t waste their time. And if shareholders agreed to hire them for that much, then they must be worth the buck. But if after all that they want public money, their salaries should be affected as well.
- Posted by wolandBefore the first cost-cutting measure is implemented, before the first worker is laid-off (made redundant), upper management must refund their 2007 bonuses and agree to forego that for 2008, on penalty of sacrificing their jobs and possible civil action.
- Posted by David M. Milleri can’t believe how jaded ABC news is:
“It costs about $20,000 to fly one of these jets round trip from Detroit to Chicago — far more than the $900 cost of a first-class ticket on Northwest Airlines, ABC said. ”
why do they have to fly first class? why can’t they fly coach like all the other people who are struggling in this economy.
- Posted by Mike GOf course they are completely out-of-touch with how the rest of us “formerly of the middle-class” are now forced to live (hand to mouth, a “working retirement”, shaky health care access etc.) Pelosi might as well light a bonfire with bucks as donate them to the Big Three.
How about a tax-credit instead, to Americans who purchase a new car of any make, where the credit is rated according to the car’s cost and the proportion of the manufacturing (in dollars) that was completed in the USA. If they can’t compete with Toyota, Honda and Hyundai then good riddance.
- Posted by DB LazofThese guys need reality checks! Maybe if they scale back their lives and live on $40,000- $60,000 a year their employees make (if even that)and pay more for health care
- Posted by dianeand deductibles they would appreciate the “middle class struggle” Alot of traveling employees are supposed to be thankful for coach, $30 a day meal allowance and a discounted hotel. these guys need to cut back their lifestyles and alot of their pay, incentives etc. before they ask employees to give up any more!!
CEO pay and Corporate executive pays/bonus should be highly regulated or there should be a government law imposed on their amount. Also there should be law of severe punishment and cut down of their bonus and payment in cases of company fail to performance due to their stupid act. This ridiculous amount of money as salary and benefit package should be trimmed down to reasonable amount. It is true that our so called big politicians are not willing to do that as they get their most of their political campaign money backed by this money hungry CEO. Its really a matter of regret that we live in a democracy where an average worker wage and a CEO wage/benefit difference is completely non-democratic process.
- Posted by kalyanThese guys are either too stupid to realize the message they’re sending, or too arrogant to care.
The three of them should have just piled into the Edsel and driven down to D.C….
- Posted by John