ORLANDO, FL –Co. Vice Chairman Bob Lutz says the auto maker’s focus on building class-leading products instead of cutting costs to satisfy shareholders will remain after he retires, but just a year ago that was not the case.
Lutz rejoined GM earlier this decade and nearly unanimously is credited for making the auto maker’s cars and trucks more attractive.
The latest-generation Cadillac CTS, for example, went from an also-ran in its class to one of the industry’s most-decorated luxury sedans. Lutz arrived late into initial development of the car but entirely oversaw the second generation.
Industry experts also would point to the new-for-’10 Cadillac SRX, which in January jumped to No.2 in its segment, behind the Lexus RX 350, from No.7 in its previous-generation skin. The hot-selling ’10 Buick LaCrosse sedan and Chevy Equinox cross/utility vehicle are two more examples of Lutz’s influence.
“Up until a little while ago, I would have said, “Yeah, there’s a risk (in leaving the company). Now, I don’t see it,” says Lutz, who has not put a timetable on his retirement from GM.
He points to a recent meeting with Ed Whitacre and other senior managers, where the newly seated Chairman and CEO questioned longtime GM “sub-measures,” such as reducing hours per vehicle.
Lutz recalls Whitacre asking what GM’s mission was. “’What is the one thing we believe is necessary for success? We agreed the mission foris to design, produce and sell the world’s best cars and trucks.
“That’s it, that’s the whole mission statement,” Lutz tells Ward’s in an interview before delivering the keynote address at a conference affiliated with the annual National Automobile Dealers Assn. conveniton here. “There’s no, ‘Create shareholder value, and serve society.’”
Excellent cars and truck, he adds, did not even rate mention in the auto maker’s mission statement. “The organization is now at the point where they are unable to focus on doing anything but the best.”
Lutz says up-and-coming executives have his same no-nonsense demeanor and intolerance for cutting corners.
He points specifically to influential car guys such as fellow Vice Chairman Tom Stephens, formerly head of powertrain operations and a self-confessed gear head, and GM North America President Mark Reuss, who once led development of GM performance vehicles.
“(They) are exactly the same way I am. So I could leave anytime and it would not make a difference,” Lutz says on the day he celebrates his 78th birthday. “A year ago, I would have had a different answer.”
However, he admits his role within GM has not diminished greatly since giving over day-to-day operational duties for marketing and product development earlier this year to GM’s new executive team and accepting more of an advisory role.
“I’m still in all the design reviews and all the product reviews,” he says. “I basically do what I did before, except before I could say, ‘This is what we are going to do.’ Now, I say, ‘If it were my decision, I would do it like this.’”
Following his keynote address, Lutz tells dealers GM pricing on new models will be more competitive with rivals such asMotor Corp. and Motor Co. Ltd. Better products are rebuilding GM’s brands, which gives the auto maker the ability to charge what the car or truck actually is worth.
“This Wal-Mart pricing at GM is out,” he says.
Lutz also says GM’s $1,000 incentive to customers trading in avehicle and buying a GM product is not driving market share gains.
“I don’t want anyone to believe our greatly improving market share and sales results on (the) SRX, Terrain, Equinox (and) Buick LaCrosse has anything to do with the competitor’s weakness,” he says.
Lutz specifically cites the notion the SRX gained sales because Toyota’s Lexus brand was ensnared in the auto maker’s unintended acceleration scandal.
“It had nothing to with it, whatsoever,” he says. “The only reason we put that $1,000 (out there) is because the dealers were telling sales-and-marketing this was an historic opportunity, and (they) needed the money.
“But there is no strategic intent behind it,” Lutz says. “Other than that, we want to stay completely away from it. The situation is bad for whole industry, and we hope it goes away as soon as possible.”