- The Washington Times - Tuesday, November 25, 2008

DETROIT

Things are getting so tough in Detroit that General Motors Corp. announced that it has ended its contract with Tiger Woods, and the CEOs of the Big Three automakers were reportedly considering a car caravan for their return to Capitol Hill in bailout negotiations.

The Woods endorsement contract will save GM, the parent company of Buick, what’s left on the golf icon’s $8 million-a-year contract, which had a little more than one year remaining. The car caravan, however, even if the automaker heads pull it off - to quell criticism of using their private jets on their first trip to Washington - may be too little, too late.

“The tragedy of this is, it indicts the integrity of their intention,” Tennessee-based public relations executive and branding expert Holly Gleason said of the caravan. “It’s a response to being called out, rather than a genuine demonstration of their commitment to fiscal responsibility. In our world of cynicism about the media, this is embodiment of ‘gotcha’ responsiveness.”

The automaker should be selling the “people” angle of their problem, encouraging Congress and others to embrace the notion that a federal loan would help real people doing real work - not bolster the executive halls, where multimillion-dollar salaries and perks like jets are the norm, she said.

“Beyond the caravan, I would bring people from every stage of production that we touch to explain what it is they do, what it is they earn and how that money sustains a way of life that defines working-class America,” she says of regaining image ground lost by the jet fumble.

Miss Gleason said it was surprising that the companies did not seem to consider how their high-flying executives’ mode of transportation to Washington might play publicly, given the nation’s fractured economic psyche in recent months. Their freewheeling spending and seeming indifference to it was lampooned over the weekend on TV’s “Saturday Night Live.”

At an estimated $20,000 per flight, it was an audacious arrival and extreme public relations blunder for the auto CEOs, who told Congress that they needed $25 billion in federal loans to help them weather a sagging U.S. auto market and ongoing credit crunch that they claim could stymie a bedrock manufacturing industry for the nation.

“Nothing says ‘let them eat cake’ to the working people, or ‘we have no clue,’ like ‘fire up the jets,’ ” Miss Gleason said.

A Detroit-based auto-parts company president and CEO, Tim Leuliette of Dura Automotive Systems Inc., is floating the notion of the car caravan, the Associated Press reported.

The caravan would return the Big Three automaker heads - Alan Mulally, Rick Wagoner and Bob Nardelli - back to Capitol Hill on Tuesday when they are to offer specifics to Congress of how they would use money from a federal loan package to salvage their troubled industry.

The CEOs of GM, Ford and Chrysler arrived last week to testify before lawmakers, claiming in often vague statements their industry’s dire financial straits as they desperately sought government bailout loans. Their lack of specifics about how they would fix their sagging corporations set a poor tone, but legislators were angered and consumers disgusted when it was learned that each traveled separately by private plane to testify.

Peter M. De Lorenzo, an author and automotive marketing expert who blogs about the industry on his autoextremist.com Web site, said it’s tragic the members of Congress and the media seized on the jet issue, rather than the broader concern that a real industry was in peril.

“Members of Congress are equally adept at tapping into private corporate jets for their own use, including the Democratic speaker of the House, Nancy Pelosi,” Mr. De Lorenzo reminds. “One of the first things she did was ask for a larger government plane so she could fly nonstop back and forth to California.”

He acknowledged that the car manufacturers lost the first volley in the aid discussion and that there is very little they can do to make up for how it played out in the court of public opinion.

“Will corporations abandon jets in the future? No. Should they have flown down there in them to testify? Probably not,” said Mr. De Lorenzo, the author of “The United States of Toyota: How Detroit Squandered Its Legacy and Enabled Toyota to Become America’s Car Company.”

The lawmakers’ focus on the jets, however, belies “how little they do know about the gravity of the situation and what is actually going on in the auto business,” Mr. De Lorenzo said. He thinks a caravan full of high-tech vehicles, showcasing Detroit innovation, may serve as a good reminder to Congress and others about the scientific advances U.S. auto manufacturers have made and how far they have come in “re-creating themselves” over the past six years after 20 years of turning out substandard products, which led to their image downshift.

Mr. De Lorenzo and others in the auto business said Congress, like much of America, has paid little attention to advances made in Detroit and thinks they are buying into an image deficit that isn’t going to go away quickly. The perception gap was never more apparent when the auto CEOs were put through their paces on a national stage, he said.

“These members of Congress were commenting on a Detroit that really doesn’t exist anymore,” he said. “Detroit has restructured and reinvented itself, and they are building some very competitive cars, in some respects not only equal to Toyota and Honda, but surpassing them. Hopefully, when they caravan down there they might regain a little bit of respect and understanding.”

The end of GM’s contract with Mr. Woods was a cost-cutting measure for the automaker and an opportunity for the world’s No. 1 golfer to spend more time with his family, especially with a second child on the way, the AP reported. Mr. Woods brought many new and younger buyers to Buick, the main focus of his contract.

LOAD COMMENTS ()

 

Click to Read More

Click to Hide