There are two starkly different opinion pieces on GM in today’s New York Times – one written by William Holstein the other by David Brooks. The former criticizes the Obama administration for removing Rick Wagoner as Chairman of General Motors, just when GM reaches the “high-water mark of revitalized American car design.” I couldn’t help laughing out loud when I read those words, they were so absurd. When Wagoner took the helm at GM in 1994, they had 50% of the US market. Today they have 18% and continuing the erosion in the first two months of 2009, GM sales have fallen 51% while the industry declined 39%.
Brooks takes a more reasonable perspective and notes that GM has been “restructuring” since he took over. Restructuing, he writes, is for GM “like what dieting is for many of us: You think about it every day. You believe it’s about to work. Nothing really changes.”
This morning, GM’s stock is trading at 2.37 giving it a market cap of $1.45 billion. How can anyone defend Rick Wagoner when this colossal failure is clearly at his doorstep?