We're Experiencing Turbulence

The Congressional grilling of the Domestic Three was far more focused on senior management's misuse of private perks than on the weighty issues of employment, taxes and innovation.

No doubt, a public whipping of a few executives' inability to produce desirable cars and their profound lack of customer care make far more riveting copy than a dry economic study of American dependence on the Detroit car business.

Greed is sexy reading, financial reports are not. But the numbers do tell a story more important than documenting millions of dollars of executive compensation recomplete with $5,000 an hour jet rides to woo Congressional sympathy.

The significance of getting back on track is more important by a wide margin. Yet, we should not ignore the connection between the two. These men have lost touch with how and what the public thinks. That's at the heart of the problem.

Somewhere in time, the benefits of short-term profits were put ahead of cultivating long-term customers. How else, in this day and age could such sophisticated executives so thoroughly miss how bothersome their perks would be to a financially suffering public?

It's not about a few hundred thousand of wasted travel expense. It's about the kind of flawed intelligence that will continue to bring failure to otherwise satisfactory products.

A valid vetting (not grilling) should be undertaken to determine whether the once Big Three can really change their direction from Wall Street to Main Street. The “Main Street thing,” on which President-elect Barack Obama mounted a big win, is the most driving dynamic in today's American psyche.

The little guy is angry about being taken in by Ponzi schemes that hammer a lot of people in order to make a few people rich.

This is not about the high cost of union pensions. This is about the way in which customers have been treated when they expected their warranties to be cheerfully honored.

Or what happened when unbelievably low financing ads were tied to arrogant captive finance companies. Or when gotcha factory programs caught them in the fine print.

Market sensitivity is the dividing line between those who should be bailed out and those for whom bailout would be a wasted investment. Companies focused on year-end bonuses will not likely use bailout money in an effective way.

Similarly, companies that think the bailout money will allow them to wait out the storm, or will provide hazardous-duty pay for those who stay through scary times, will die a moment after exhausting the public dole.

Survival will be about embracing the customer and everyone and everything that touches the customer. Green strategies and golden handcuffs are distractions. They are worthy, but distant goals. Satisfied customers are a “now” goal.

I made three calls recently to see if a domestic auto maker would like to sell (yes sell), some large SUVs and heavy-duty pickup trucks to my fleet company which has immediate need and funding for them.

It took almost a week to get a call back, and weeks later only one of the three (Ford) has actively pursued the sales which may number in the hundreds over the next six months. Whose interests are the others serving if they can't take a sales call seriously enough to call back?

What this means, at least in part, is that there are things more pressing to those companies than selling cars to willing customers.

This is what is causing the minds on Capitol Hill to debate the efficacy of providing billions to bail out the domestic auto industry as long as it continues its attachment to its existing management teams. No one in Detroit is inspiring anyone to follow them through the fires of hell to turn this around. They must surround themselves and marry themselves to a meritocracy wherein middle and top management are tied to long-term customer satisfaction rather than to rewards for achieving short-lived gains.

Peter Brandow is a veteran dealer in Pennsylvania and New Jersey.