A liberal dream plan for GM

June 1, 2009

MIchael Moore makes the following minor and humble suggestions to the White House about what it should do with its 60 percent stake in General Motors. Some excerpts:

1. Just as President Roosevelt did after the attack on Pearl Harbor, the President must tell the nation that we are at war and we must immediately convert our auto factories to factories that build mass transit vehicles and alternative energy devices.  … President Obama, now that he has taken control of GM, needs to convert the factories to new and needed uses immediately.

2. Don’t put another $30 billion into the coffers of GM to build cars. Instead, use that money to keep the current workforce — and most of those who have been laid off — employed so that they can build the new modes of 21st century transportation. Let them start the conversion work now.

3. Announce that we will have bullet trains criss-crossing this country in the next five years

4. Initiate a program to put light rail mass transit lines in all our large and medium-sized cities. Build those trains in the GM factories. And hire local people everywhere to install and run this system.

5. For people in rural areas not served by the train lines, have the GM plants produce energy efficient clean buses.

6. For the time being, have some factories build hybrid or all-electric cars (and batteries).

7. Transform some of the empty GM factories to facilities that build windmills, solar panels and other means of alternate forms of energy.

8. Provide tax incentives for those who travel by hybrid car or bus or train. Also, credits for those who convert their home to alternative energy.

9. To help pay for this, impose a two-dollar tax on every gallon of gasoline.

Me:  I am not sure what is more far fetched, this plan or the belief that Obama would actually try and implement anything as radical as this plan. Just take a look at the way Obama is letting his cap-and-trade plan get watered down. Folks like Moore really don’t understand the guy they voted for.

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I was out west this spring and driving about in my vintage 2001 Saturn when I decided that it was up to me to keep the promise of America’s automobile industry alive – so I tried to a dealer owned coop to save Saturn. This was a dangerous moment as I had not been authorized by anyone involved in making, shipping, selling or storing Saturns. In fact, I have had nothing whatsoever to do with the car industry except to persist as a committed “try to buy American” consumer. It would be nice if others among the original sold on Saturn buyers joined me and raised a protest about GM’s disposal plans for one the last great car brands made in the USA.

To some degree this mad adventure had something to do with the wild west. There I was in a setting that has been sending natural resources including raw minerals and livestock overseas where manufacturers convert them into products for us to import and buy. It seemed to me that this time we wouldn’t be bothering to ship anything of a made in America nature, we’d just let foreign manufacturers step in, extract the value of the Saturn name and make that once great manufacturing venture part of the growing trend to colonize the world for a multi-national corporation.

I had heard that GM’s executives were preparing for bankruptcy and that they had decided to stand back, stay quiet and let one of the nation’s premiere auto brands be plundered. Even knowing this, I still found it shocking to learn that India’s Tata Motors was among number of serious contenders for the Saturn brand. It was prepared to buy out the brand and take on the dealerships in order to have speedy access to a far reaching and friendly national distribution system. Saturn would thus become an outlet for cheap, fuel efficient Indian made minicars. Alternative American proposals were not much better. Mega scale car dealers like Oklahoma‘s Moore family and Michigan’s Roger Penske are also trying to buy the brand so that they can convert Saturn’s franchise operators into sales centers for other small cars made offshore.

Tata might not be a household word in the continental US but it is an enterprise that has put much of India’s enormous middle class on wheels. Less we forget, this is a population bigger that of the USA today and as hungry for foreign oil as we are. Their little $2,000 yellow and red cars are likely to start moving people onto roads here sometime this year and it would be a pity to see them carry the Saturn label to a depth lower than the level GM imposed.

As it happened, GM introduced Saturn to do what TaTa did in India. It was trying to capitalize on demands by first time car buyers for low-cost, fuel efficient cars . An oil production crisis in the 1970s had made Americans aware of how their gas guzzling ways could expose the entire nation to economic disaster. They saw Saturn as a way to attract consumers who were showing preferences for Japanese and German cars that were fuel efficient and long lasting – two qualities that were not Detroit made autos strong suits.

The early generation of Saturns were aimed at buyers like me – first time women car buyers who knew nothing about what went on under a car hood but wanted a assurance that their dealer would. In fact, I was among the early cult of satisfied Saturn owners and though I never attended one of the early “owner reunions” at its Tennesee plant, I did feel a strong allegiance to the brand and to the people at its dealers who kept true to their promises of easy maintenance and reliable service. It is a pity that more of those contented consumers didn’t stand up to GM as I have in these past few days. I would love to see more visit dealers to ask them to get together as a group and form a coop to make a new generation of different American cars.

My enthusiasm for the car had started in 1989 when I had a chance to visit a prototype for Saturn’s pilot plant that had been set up in Detroit. It was clear then that it was a different kind of car company. GM had learned from studying Japan’s Demming quality control principles. Their attention then to consumers’ concerns was effective. Nearly ten years after early, long-lasting models stopped being made, people still think well of the brand and of the dealers selected to represent it. Some of those early 90s models are still on the road, chugging along with their original engines, power trains, plastic body panels and brilliantly engineered chasis.

I bought my first in 1991 and had three others over the next ten years. They were terrific cars and the dealers that sold them all appeared to me to be honest and reasonable. They were true believers in the company’s ability and ready to hear and act on concerns and recommendations that their customers shared. I think if customers showed up at their doors and told them they would be back if the cars were made here in the USA again they might be prodded to get the help they need to take over the brand and its production.

I also think that labor unions should get on board about this. One of the best parts of the dog and pony show I was treated to when I toured that pilot plant years ago were discussions by management and labor about how they were going to relax old rules, work better together and find ways to continuously improve the Saturn. They said they were determined to offer American drivers alternatives to the high pressure purchasing practices of other car dealerships and put sales people on salaries to assure high levels of customer service. They did that and more.

Within just a few years of its introduction, Saturn consumers ratings were sky high and the relatively low priced little cars from Tennessee met and surpassed customer satisfaction ratings given to higher priced and bigger luxury cars. Profit margins were low but consistent. This wasn’t good enough for the high rollers in Detroit that needed giant profits to attract and hold investors and pay enormous salaries to high level GM Executives.

So Saturn’s innovation era ended and it became just another branded GM product line.

I stopped buying when the rules changed. So did lots of others. After 2001, Saturn became little more than a retailer of Renault and Opal cars. Dealers no longer stood alone and the once fabled Spring Hill factory was no longer the exclusive producer of Saturn cars. Unique, innovative design standards were gone and the attributes that distinguished my last plastic sided model were no longer to be found.

In my view, Detroit’s feudal systems wore out the company. Its inability to accept low profits as a return on its early stage investments has killed it. Saturn dealers are an endangered species. Their lots are holding grounds for a dead brand and remaining Saturn cars dramatically depreciating in value. Highly leveraged dealers have been left holding the goods. More than 10 percent of Saturn dealers have already closed their doors and when you go into showrooms as I have done since last week, you feel like you have come upon a cohort of mourners getting ready for bankruptcy and job changes. GM has done little to stop the hemorrhaging and in fact opened new wounds with announcements that it would receive offers for Saturn up at the end of spring and would then decide how to dispose of its brand assets while reorganizing through a possible bankruptcy.

All of these ruminations have of course made possible by American taxpayers who have thrown a few trailer loads of dollars into GM to keep it afloat. But imagination and innovation are in short supply among that company’s senior level managers. Because of this, I decided it was up to eager beavers like me and other old time Saturn owners to keep the rings of a unique American car turning. So I turned to my friends the cooperators to figure out how. There is a new, 21st century type of cooperative that a few enterprises like Organic Valley Yogurt, True Value Hardware and Carpet One flooring stores are using to beat out competitors. Stakeholders with property, production capabilities and shared needs band together to purchase product, secure supplies, institute management standards and jointly assure consumers that the promise of a brand name message will be met. Simple enough….they have numbers large enough to press down margins set by producers and service providers and pass those on to the people who buy from them.

In a few cases, these new types of coops actually have a hand in manufacturing. That is where I think the focus of an effort to save Saturn should be and where consumers should focus their arguments to keep Saturn going. We need to be able to make high quality, innovative cars here in the USA. Saturn has shown us that it could do that when it isn’t tethered to GM. It still has the capacity to outperform offshore manufacturers and can apply what we now know about alternative fuels and power trains to new car designs.

Despite consumer demands for alternative cars and the standing lines that formed for Japanese hybrids, GM chose to ignore Saturn’s potential to deliver on these technologies. It forced Saturn to become a conventional car brand and devalued its potential for innovation because earnings didn’t reach stratospheric heights that GM executive demanded. When franchise owners were pulled into the GM fold, the buffer that their Saturn rings had once created collapsed. A cooperative could put them back in place and a clamor of hold the line from consumers could give stakeholders time to form one.

If the dealers did come together with the intentions of serving as sponsors and outlets for alternative energy powered cars, they just might be able to outbid contenders like Roger Penskie, TaTa and the Oklahoma Moore Familys Black Oak Partners LLC. With help from local legislators, cooperative investor resources, rural utility funds, and even US Treasury assisted GMAC Finance, they could raise capital needed to make a downpayment on America’s automotive future. They could again work cooperatively with labor and sell off their current GM produced inventory with commitments to extend their warranties and stand solidly behind them. Most importantly enlist a new cohort of alternative energy minded engineers work with the US Department of Energy to create new cars that will in fact put more rings around Saturn. If we don’t, we are sure to see the stimulus money being paid out to keep Americans buying go into the hands of offshore manufacturers who have taken our know how and sold it back to us at premium prices. So, my challenge to Saturn is wake up, get organized, and cooperatively work for a revival that our country needs and deserves. As crazy as it sounds, listen to your buyers and keep going.

Posted by Carol Coren | Report as abusive