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tv   Book TV After Words  CSPAN  October 29, 2011 10:00pm-11:00pm EDT

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.. creating jobs and reassuring their global leadership so it is great to have an opportunity to visit with you about that look. i think a lot of viewers might want to start with just the question of how these companies got to the brink of disaster? how did these great american icons really come to this point we are in some cases they almost
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cease to exist? how did this tremendous crisis come about? >> guest: the big three other makers were dominant for so many years between the 60s and 1970s and still commanded 50% or more of the market into the middle of the last decade but there is a slow acting poison going on with the auto companies and i -- legacy cost. these companies were supporting hundreds of thousands of retirees and surviving spouses with health care, with pensions. gm's case i think was to retirees for every x worker. this was part of what made these companies so great was that they did have this great retirement plan and great pension plan. unfortunately those were written when the companies were incredibly successful. times of change so dramatically
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that those cos really weren't sustainable with the kind of volumes and sales that they had fallen to. on top of that, it is pretty well-known that the detroit companies had made some mistakes they have since been exposed and their product portfolio became much heavily weighted towards large vehicles, trucks, suvs. these are the profitable products for them and they neglected passenger cars and some of the more fuel-efficient models that the japanese competitors were so strong in. over time, i think they lost their way in trying to improve their products and it was more of a matter of survival and trying to sustain what was working for them, and in the end, they couldn't support these
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enormous organizations and these enormous obligations. >> host: when should it have been apparent to the companies that the legacy cost warrant sustainable in your view? >> guest: there is there is always been a lot of debate about who is at fault here. is that the unions for, the united auto workers for asking too much and demanding higher salaries, more benefits or is it the companies who gave away the store? we hear that a lot. some people criticize general motors. they just gave everything away to the uaw. people have to remember that these contracts the union negotiated were and these companies were making a lot of money. maybe they didn't look down the road far enough but maybe in the '90s, maybe even a little later when the gas prices weren't such, so low that everybody wanted to own a seven passenger suv, might have been the time to look at hybrids or at least direct more resources
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towards the smaller more fuel-efficient cars. a lot of americans wanted them and weren't getting them from gm, ford or chrysler. >> host: were you surprised at the mechanism that companies use to move some of their legacy costs off of their balance sheets? >> guest: the 2007 labor talks were really a watershed and the union should be given credit for understanding that general motors in particular could not afford the billions and billions of dollars in health care that they were spending on retirees in particular. i think for several years or every 1 dollar gm spent on health care health care they spent 1 dollar on products. not too many businesses can survive that kind of drain on their cache. cash. so it was, these companies were on thin ice if you will for quite a number of years in trying to make it quarter to quarter.
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but the 2007 agreement allowed them to offload these costs and to -- into health care trust but even that in retrospect is a little bit like monopoly money. gm committed nearly $30 billion in 072 retiree health care and that money just wasn't there. i think it became clear a year later that sort of the whole of the battleship had sprung a big week in gm's final -- financial structure and ford as well. they just couldn't meet these obligations any longer. >> host: you mentioned the similarities that some the companies place but they obviously took very divergent paths, the three companies as they move through the crisis and restructuring and now in some ways they are all profitable and creating jobs. but very different ways to get there. you might talk about the three
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different paths and why you think those companies took the source of paths that they did, the individuals involved in the personalities involved. whited ford take the path versus gm's obvious choices and chrysler of course? >> guest: we will star was general motors. they have been the biggest and dominant company, leader in many ways of the industry in america, very proud company with a lot of success and somewhat resistant to change. i will be charitable here. some people can cast stones at gm and their corporate culture at what worked for them were many many years is what they believed in. general motors is a corporation had corporation had a hard time admitting mistakes. i think that is a lesson that was learned. not so much their senior executives in private that the corporation itself, very
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resistant to any kind of criticism or suggestion that maybe they should do things differently. their ceo, wicker wagner, in the book are a described he has the perfect resume. he was a defender of general motors. when gm was attacked, mr. wagner and his people defended it. in hindsight, perhaps some of those criticisms of some of the suggestions that gm needed to go in a different direction were not heeded. they fought change rather than embraced it. ford motor company was the smaller version at gm and operationally, the same kind of structure, same kind of global strategy, but the difference is it was controlled by the ford
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family, descendents of the legendary henry ford, so they could make some adjustments based on their leadership, which at the time was henry ford's great-grandson. bill ford and becoming ceo learned pretty quickly that the company was having the same kind of troubles as gm and in what i would consider a very admirable decision on his part decided to look for answers outside of detroit, began looking at other auto executives of foreign make her such as daimlerchrysler and nissan to perhaps higher their ceos to come and and bring fresh ideas. ultimately he went way outside the auto industry to the boeing corporation and recruited allen mullally who is senior executive building commercial airplanes and brought him to detroit to
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take a different market for it. what was wrong with this company and how could they do things differently? mr. mullally had an epiphany when he arrived in detroit, which was ford needs to change and change drastically. all these things start at the top. you have to have the wherewithal and i believe the sort of guts to make some of these hard choices. ford made some hard choices a lot earlier than gm did. the biggest of which was in late 2006, when they decided to mortgage the entire company and borrow as much money as they could, $23 billion, to take a rainy day fund a few well when things got tough and more portly to start transitioning the company away from its reliance on suvs and trucks to smaller more fuel-efficient passenger cars. >> host: sure.
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one of the things you touch on in the book and i am sure you are a fact-driven hard-nosed reporter but you spend a lot of time with the emotional connection between bill ford and the company. you might talk about that a little bit because it really is compelling and you spend a lot of time. it is moving actually. >> host: bill ford is a passionate, dedicated, emotional man who is in a very unique position. he was an owner and he was an executive at the same time. he had a family, a history and the financial wherewithal with a corporation yet he was close to hundreds and hundreds and hundreds of men and women on the line, the engineers. he lived and breathed his company since he was a kid, and i felt that mr. ford always had the companies best interest at heart, however he had a legacy
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to protect it. when he became the ceo ford was still profitable and suvs were still making a lot of money but he saw the handwriting on the wall, and i believe that an unusual and difficult decision for him was to admit that i might not be the best person to be the ceo of this company. where'd you hear that in corporate america these days, someone saying you know that somebody else might be able to do this job better? >> guest: humble and grateful at the same time. >> guest: extraordinary, but it was wise. it was a wise move. bill ford understood that history was changing and ford was not changing fast enough and whether it was, you could see such a familiar figure in the company and perhaps people, their emotions got the better of them which was bill ford, ford is going to be okay now.
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bill ford saw the little differently. he realized that his company maintained its stature to grow and had to go back to basics. he wasn't perhaps the best guy to do it and he needed someone who was experienced at turning around industrial corporations of that size. >> host: the thing about the three companies and the company that had the least predictable path obviously was chrysler with foreign ownership and that obviously private equity ownership and then of course now the partnership with fiat. talk a little bit about their path and how that all came together. there are obviously lots of different options. there was always some discussion of a chrysler merger with one of the other american based companies. that didn't come to fruition and obviously took a diversion path
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and has turned out extraordinarily well. >> guest: chrysler was always the hyperactive, youngest sibling of the big three. gm was the dominant one. ford was a little more conservative but always followed a lot in gm's footsteps. chrysler had omman bus history for decades boom and bust history for decades. i come to the merger with daimler benz in 1998 which was an extraordinary situation. that was the biggest merger in automotive history and i think maybe the biggest industrial merger of all times. it looks to be a great marriage of the german luxury cars and german ingenuity with mass marketing of american trucks and minivans and suvs. it turned out to not need a marriage made in heaven that was anticipated at the time. these companies did not mesh. they didn't have enough in common and chrysler found itself in a position where the german
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owners actually looked ahead in the future and saw chrysler as a drag on daimler and a threat to daimler. the chairman and ceo of daimlerchrysler realized very early on when he got that position in early 2006 that the legacy costs and the obligations and the paperthin profit margins at chrysler had could turn into a real problem for daimler is the market turned. he was somewhat impressed in and selling the company. it was sold to capital management, the private equity firm on wall street which had a game plan of kind of stripping it down to its essentials and rebuilding the company. we will never know how that worked out or how it would have worked out because they only on the company for a year when the
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financial crisis hit this country in 2008 in auto sales went off the cliff. chrysler was incredibly vulnerable at that point scrambling for a partner, trying to merge with general motors. their executives are traveling around the world looking for foreign automakers to link up with that but at that point detroit was in chaos. the crisis was unfolding day after day and chrysler really was saved from extinction if you will buy fiat. i think when detroit went to washington, the government assistance, i believe the bush administration and then the obama administration saw general motors going out of business as a disaster for the economy. with chrysler they weren't even sure was worth saving so this is
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a little company -- makar company that could with 50 or $60 billion in revenues compared to the other two really needed a hand and a partner. >> host: a question, they make as many cars as toyota does which was until recently the largest partner in the world, so it was important it remained a viable enterprise i think it was interesting to see how you've laid out that path and what occurred in the book and under this partnership now with fiat it seems to be extraordinarily successful. do you have any thoughts on the partnership? >> guest: absolutely. i've been coveting -- makar bring the three companies on a daily basis and i don't think a lot of people gave chrysler much of a chance when i came out of a grassy. i think fiat was a bit of an unknown. they haven't sold countries -- makar's in this country for a number of years and don't have a high-profile like daimler did or
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toyota for that matter but again, sergio markey on who is the ceo of fiat and also the ceo of chrysler was an outsider. one of the themes and lessons i think i take away from my coverage of the industry is an outsider bring something to the party in detroit. for the longest time outsiders were not welcome here. their ideas were suspect and they didn't understand the business and they didn't have the experience. allen mullally of ford prove that was a fallacy and an executive with experience and vision can succeed in auto industry wide applying sort of the basic turnaround principles. match your marketeer production, improve your products for consumer, what do consumers really want and stick to a plan. he has come and and seen the
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good in chrysler, seen what chrysler is capable of doing. which may be people close to it had soared and give -- sort of given up on. he was applying a lot of the fiat engine technology chrysler. this could be a new car built tyranny in the back 40-mile per gallon passenger car through fiat technology and it's interesting to see that the same people who were ready to throw dirt on chrysler's grave trumpeting the fact that the company has a resiliency and sort of the know-how to come back and make cars and trucks that people want, which really is the secret. >> host: that is an exciting story. one of the areas of the book that revealed some new facts was relating to the gm ford merger discussions and obviously gm's real interest in pursuing that. you might talk about that ross s. and then maybe what that
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might have meant for the industry had that occurred. >> host: talk about the conversation for years, what would happen if gm and board the two biggest american car companies would be this one company. they wouldn't even be this big three and a more. put all their resources together, all their market share. kind of a good hypothetical but never been seriously approached because these companies are bitter rivals and have been for years. i think i made the analogy the yankees and the red sox merge? i don't think that would work out. there is a lot of overlap but also very distinct identities and nature meant this competitive spirit. that is why bill ford and allen mullally were so surprised in the summer of 2008 that rick wagoner and the generals motors
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executive team approach them about a possible merger. i think i would say they were shocked but what they learn very quickly was this was just demonstrating how desperate general motors had the calm at that point. between the second quarter in the third quarter of 2008, gm went from being a quote help the company with plenty of cash reserves to a company that was running out of money and was going to be insolvent within 60 to 90 days. really extraordinary when you think about it because they were just spending so much cash to keep their head above water. when mr. wagner approached bill ford, and they had worked together on a friday of issues over time, and to each other to create issues here in washington, the union contracts, so they knew each other well and there was a healthy respect, but ford's contingent was stunned that gm wanted to submerge --
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merge with them totally out of the blue and quickly realized that this was indicative that gm was desperate. they had nowhere else to turn. they had been shut out from borrowing money on wall street. their restructuring options had dwindled down to cutting jobs essentially and cutting costs and ford was look at as a potential lifeline. ford for their part wanted nothing to do with gm in that state, and actually felt that gm was coming to them because they did have cash. they did have money they have borrowed from the banks, but shortly thereafter it became clear that ford had followed gm to washington d.c. general motors could get the lifeline they are because the prospect of gm going into some sort of controlled bankruptcy liquidation would have affected
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for dramatically, the whole supply base in the country would have been up-ended and it also was an indication that the big three were sort of cracking apart if you will. gm was going one way to the bush administration in congress and later the obama administration for financial assistance and ford was going to go on its own path and turnaround on its own. >> host: well, obviously comp it is it made a lot of changes since 2007 like you mention. in 2008 we did go into an economic crisis and everything from just obviously with the collapse of the financial industry, the dramatic decrease in people's home prices which can affect their purchase of what is for most people their second-largest purchase which is a car and than the collapse really of the sales rate from
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about 17 million units to 10 million units was a stunning development. how much of what happened in 2008 was really beyond the control of the companies? how much of what happened with the american car companies was really beyond their control and how much do they have to take ownership of? >> guest: when you go from 17 million cars sold the year to 10 million sold, 45% drop is an extraordinary situation. i'm not sure any business can survive very long to lose 40% of their volume. should they have seen this coming? i can't anticipate how they would have seen that. it affected all the car companies. the japanese companies, the european companies. it was that and down the hatches time and the fact is gm could not have picked a worse time to go to washington because the tar
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ponds and the assistance to be wall street and the financial community already had people very upset and concerned, worried. there was every election for congress going on at that time. there was a presidential election going on. it couldn't have been a hotter seat to sit in to testify before congress and ask for money to save car companies. you asked about ownership. they had to take ownership for some of the animosity that had been building up for years against detroit, whether it was for the quality of their products or their resistance to change, fuel economy or the environment, crying foul every time a foreign automaker made gains in the united states that it was the fault of washington
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and trade policies. it was extraordinary how a lot of the emotions, many of the negative, about the car companies and i think general motors and particular, just poured out of those congressional hearings. frankly these executives were stunned. they thought when they came to washington that the politicians would understand immediately that this was in the national interest to bail these companies out and if gm went bankrupt, the ripple effect on jobs would be in the hundreds of thousands and maybe even larger. but instead all of a sudden all the vitriol and the anger that had been building out about how detroit had conducted its business for years all came pouring out, whether it was people who didn't like unions,
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didn't like gas guzzlers, didn't like the way detroit built cars, had a lousy pontiac that didn't work for them 20 years ago. it all started coming out and it was pretty, was pretty surprising but one of the executive said something interesting to me in the aftermath of that. he said if nothing else, there may have been a lot of apathy about the auto industry. do we even need an american auto industry? would we be fined driving toyotas and hondas? at these hearings in this crisis forced americans to address this issue. how much do we value having an auto industry? it is important for americans to have a home-grown company that makes cars and trucks? and that apathy that may have existed for years earlier, just a feeling we are stuck with detroit and became how can we
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support these companies and can they be better and valuable to the economy? >> host: i would argue that we have to, if we are going to make anything in the united states we need to make cars. cars are the logical thing for us to make it something that historically at least we have had a knack for and certainly today americans are turning out tremendously great products. if you think about it some low skilled things are not going to be made in the united states and an obviously things like fighter planes and mris and things we make extraordinarily well aren't going to have scale. anything that has scale that we can make 13 million of every single year creates a lot of jobs and a lot of economic activity and really has to be cars. cars are the central thing that our manufacturing would focus around. it really is sort of the underlying foundation of our manufacturing infrastructure. what would it be like if one of the companies had actually just
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collapse particularly general motors or ford had collapsed and cease to exist? what would that have meant for the united states economy? >> guest: in detroit, it would have been a disaster and it would have rippled out from detroit very quickly whether the steelers, suppliers. we have tiers of suppliers, people making the lowest tech in the and the very highest tech. >> host: in my state of missouri auto suppliers are they largest sector of the economy. >> guest: chrysler had a couple of plants down there. ford had assembly plans. these assembly plants are like small cities unto themselves. they may have two or three or 4000 jobs in the plant themselves but for every job that is in a plant there or two, three or four of their jobs, trucking companies, other retailers and restaurants that serve as the plant. the suppliers to bring parts in and out.
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they are a network and if a plant closes these things stop immediately. if gm for example had gone belly-up and had to liquidate, it would have been a matter of weeks before all their suppliers had to shut down and not to mention their dealers. dealers are a big source of employment in the country. it kind of touches every part of american life, a car does, i think. it is part of our birthright, part of our heritage. we invented you know, henry ford invented the modern assembly line and other companies, other countries learned a great deal about holding cars from us. we don't have a monopoly on it anymore but we haven't had for a long time but oyer there is a
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big hole in the american economy and con man they think the psyche of industry, if one of these auto companies or all three of them, went out of business. one of the things that have been discussed for a wild and didn't really touch on it in the book because it never came to fruition with the idea that maybe these three companies all should have merged into one and we would have won one american motors if you will, u.s. motors. i'm not so sure that would have been as preferable to what we have now, which is the competition of the three. competition is healthy. these companies drive each other, force each other to improve and i think we are seeing that now. ford for example has become a real leader in card technology. it is sort of, the shoe is on the other foot. i think most people would assume the asian automakers would have
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been leaders in the bluetooth technology in your car and the in car connectivity. it is really for the partnered with microsoft, another powerful and successful american company, to bring some of the data and voice connected phones and all the stuff that people love into the car. so, it touches all these other industries as they grow and as the companies grow, as the car companies grow, it draws in the software companies and the others who want to be part of what is really a lot of people, their second home as their car. >> host: i think the companies are doing a great job and american companies in particular are bringing those types of things that people are going to take with them one way or the other. they are going to take their phones and some other applications and things that are important to modern life. they are going to take that into the car and companies are
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focused in doing that in a way that enhances safety and insures they are not diminishing the focus on the primary purpose of driving which is driving and getting from point a to point b.. they really are making dramatic improvements i think in the driving experience and then obviously and safety. the number of vehicle miles driven continues to increase over 3 trillion miles today, fatalities and even accidents actually continue to actually declined. there is a rough focus that the companies have on safety in trying to ensure that those applications are an important part of modern life and are available in a car, available in a way that doesn't distract the driver. q. did i think a really good job in the book of pointing out this isn't just, actually you specifically say a two or three times. this is in just a michigan industry, that a lot of the great production facilities are in states like kentucky and missouri and a houma and really
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all across the country and of course the players are such an important part of our economy even in states like california which you wouldn't think of as a traditional automotive stay. you might talk about the national scope of the industry and what that means or america's economy. >> guest: one of the best -- best assembly plants gm and ford have are in texas. in missouri and kentucky, it is a national industry. these jobs are valued very highly. when i was at the oklahoma city assembly plant when it closed in 2005, it was the largest taxpayer in the state of oklahoma, and these jobs were valued down there. people still in the heartland have a real affection for
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american-made products and american-made cars and trucks. on the coast, the companies have lost a lot of market share, but that, i think part of that is due to the tremendous competition for those dollars. this really is an industry that touches many lives and the fact is it is important that they maintain these large assembly plants around the country because it is where their buyers are. it is where the consumers are as well as the workers. michigan has taken, borne the brunt of the downsizing. we still have plants that are closing that will never reopen. i think that is part of the evolution of the detroit companies. it can't be that centralized. it has to be a broad-based and of course these companies are doing a tremendous amount of
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expansion overseas as well. gm is the largest automaker in china. ford is, now that they have their domestic business straightened out, is pouring many resources into expansion in asia and elsewhere. even chrysler is looking to expand around the world. but if you don't have the assembly plants in louisville and in dallas and kansas city, you are losing sort of the real heart and soul of the cup and he. >> host: you know, you mentioned that the market share of the companies today are gaining market share for the first time in many years and they are different companies. they are different companies than they were a few years ago whether it is a much more competitive cost structure, labor cost structure, product design quality is obviously exceeding much of the competition and their winning
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quality and design awards. one indicator was their willingness to accept and agree to some very aggressive fuel economy standards, those were 2016 and even for 2025 which will change the type of product that rolls off an american assembly line. you might talk about what those new fuel economy standards will mean for the companies and obviously the environment and then of course individual consumers. >> guest: well the new fuel economy standards have taken what has been an evolution to almost a revolution. i mean, these are high goals, and i don't see any reluctance though on the part of the detroit automakers to embrace these goals. allen mullally told me, we can make this, we can hit 54 miles per gallon by 2025.
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is going to take a tremendous shift though in what people expect from their vehicles. again the evolution has been happening, the v-8 engine is almost extinct now. you see it in some trucks and some high-performance cars but very few mass american models. the four-cylinder engine is now our most popular engine for cars sold in the country, which is me think about it, a huge change. the technology though that the companies have pursued with turbocharging and direct injection and a lot of things i am probably not technically capable of explaining have made these cars just as fun to drive and reliable as the larger displacement engines of the years past that were getting 12 or 15 miles a gallon. now we are getting routinely 25 to 30 miles per gallon. >> host: and the four-cylinder engine, ford and general motors
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have each spent on their own four times what apple spends on research and development every single year so the four-cylinder and are engine can deliver is significantly different than just a few years ago. >> guest: absolutely. the driving experience has an hasn't change. in fact ford is putting six cylinder engines in pickup trucks which seemed like a real gamble at the time because the pickup typically was a va. 40% of their sales are six-cylinder. in fact i just interviewed a guy the other day who, he paid extra to get a smaller engine they guess they wanted to save on gas. some people's mindsets are changing. they are accepting these things because the products fill their needs, and they want more fuel efficiency without sacrificing size and power, and so hybrid technology will be a big part of
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reaching these new goals and all of the auto companies are spending tremendous amounts of money improving their hybrid technology and then of course electric vehicles. of very small segment of the market yet to this point but they are coming. sometime this fall, ford will begin building the first american-made electric car, electric ford focus, right on the same assembly plant where they are building regular internal combustion engines. focus, hybrid focus, plug-in hybrid and electric. let the consumer choose and the flexibility and the plant will allow them to build more electrics. or more hybrids of that is what people want. so, these numbers that are out there may seem a little futuristic or awe-inspiring. how can we possibly get there? but the pace of change is
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extraordinary and a lot of that is being driven by competition because hyundai and toyota and honda, they want to be the first ones to get 54 miles to the gallant too and in the end it is all good for the consumer because they have more choice, better vehicles, and we will in the end use far less oil which i know is a concern for everybody in this country. >> host: what are some of the impediments for this new generation of vehicles whether this plug-in hybrids, electric? there is some acceptance of compressed natural gas so what are some of the challenges for the industry as we think through some of those technologies? guest: electric cars it is all about -- and we are building a battery industry in this company for sort of from scratch. lot are subsidized by the government which is not them at different from the way the batter industries have been developed in other countries.
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korea in particular. highly subsidized because they are very r&d intensive and it takes time to perfect batteries that are going to last long enough and get the kind of performance that is required in an automobile. a little different than an appliance or a computer, so i visit some of these battery plants. they are expanding slowly but surely, but there is not enough folly him right now to support large fleets of electric cars. probably this is the way should be because i think consumer acceptance of electric cars is an impediment. my feeling is most people really don't know too much about how their traditional car works. they just want to make sure it starts every morning and gets them where they want to go. it is going to take some time for people to be comfortable with the electric car and to
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realize that this is a solid reliable vehicle, if they take care of it and charge it, is going going to serve a lot of their needs. there's a lot of talk about how far can i drive my electric car? and the companies are dealing with that by offering alternatives. gm for example has the chevy volt, primarily runs on electric power, but also has a small gas engine to recharge the battery if you need to go further than 40 or 50 miles. but this is changing every day now, and i understand general motors has been electric model they are going to be announcing very soon. >> host: all electric. >> guest: all electrics of people are going going to be old to decide what fits their lifestyle best. if you drive 30 or 40 miles a day and feel like you are happy with an electric car that you can plug-in that night, and that
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is going to serve your needs, great. if you need a second car and you want to use your electric cars your primary commuting vehicle but on weekends maybe you need something a little larger with a gas powered engine, that may be a way to solve -- serve your needs as well but there is going to be a lot of choice and i think the impediments are going to be basically technological and how quickly can we have the kind of batteries that can allow people to really make this their primary car. >> host: some obviously our infrastructure issues particularly compressed natural gas but i think you are right. consumers are going to enjoy extraordinary range of choices that wouldn't have been possible to envision just a few years ago. and i do think the companies, if anybody, people wonder if the companies are different today i think you really have to look at where they are on fuel economy and you point out the worst
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offenders of the status quo and now the companies are the ones who are pushing the ample with the tremendous technological and evasions. what is it like to write a book about companies of this size and magnitude? i mean these are massive industrial enterprises. what is it like to really dig in and go through and find all the data? obviously you have a reservoir of interviews and a lot of knowledge built up covering industry. what was it like to write a book like this? >> guest: well, i felt that the story, it was the biggest business story in the world for a good solid year and there were a lot of things that were going on in washington, a lot of discussions about what these companies meant and should we save them? did they really matter? but i wanted to tell the story.
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i felt there was a lot of opinions and a lot of emotions surrounding this and still to this day the american taxpayer owns 26% of general motors. some people are comfortable with that in some people just can't stand that concept. but it is what had to be done to keep gm alive which is a bailout if you will. i wanted to kind of strip away the emotions and the opinions and get to the heart of what really happened here, what were the decisions that were made? it was not easy. i have been a reporter for "the new york times" for three years now and have covered the stuff on a daily basis. i can't say i have ever worked harder in my life that i have these last two years because it was such a challenging story to cover, and i was lucky enough, fortunate enough that i was given time off to do some research and do some interviews
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and try to hear what went on behind the scenes. for example in this for gm merger discussion or what was happening with daimlerchrysler when people thought perhaps this merger was going to be a success but in fact the german side of the company was already planning to sell chrysler. i think we learn a lot. i learned a lot about how people operate under pressure and i learned a lot about leadership. and i learned a lot about teamwork too. no matter what the organization is, you have to have teamwork at the top and the ford motor company's turnaround is a great example of how dull ford and allen mullally sort of put their egos aside and worked as a team to set a vision for a company
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that really needed a dramatic action to survive. mullally came to detroit and said as an outsider, these companies have been slowly going out of business for 70 years. so to be able to get that kind of candor as a reporter and you to have people open up about what they really saw and what it was really like when they were faced with the bright lights of the congressional hearings and put on the spot in force to defend sort of the indefensible which is a company that general motors size is so proud and so prosperous for so many years coming to washington literally begging for help from the people that had sold so many cars to over the years, the american public. to know what that was like, to hear about it, to tell it in
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human terms was a privilege for me. i appreciate the opportunity to cover this for this industry for almost 16 or 17 years, and to get the kind of insight and to have people trust me and tell me what really happened. again it was kind of a privilege for me and something that i saw as a learning experience as well. don't think what you see on the surface is what is really happening. there is a lot more involved. >> host: you have extraordinary access and a lot of candor from everybody you talk to about the industry and what they were thinking, what was really going to their minds and some pretty critical moments. i think people were willing to admit their human weaknesses and that sort of thing. is there anybody you would have loved to talk to that you didn't get to talk to, someone that you would have liked to know what was going on in their mind and he didn't get to visit with them?
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>> guest: i was only turned down for one interview for the book. everybody else corporative that i asked and that was ron gettelfinger, the now head of united auto workers. i had interviewed ron many times over the years and obviously observed him at many events and interviewed a lot of people around him, but he went out the way he came in which is, i won't talk about what goes on behind closed doors at the bargaining table which i respected. i would have liked to have had a chance to ask about some specific, some specific dates and places and events particularly when the final negotiations were going on with the president automotive task force on how gm would go through bankruptcy and what concessions had to be made. but other than that, and i respected his decision. once a union negotiator -- >> host: you do seem to
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actually get a lot of his perspective on things he may have told others. >> guest: yes, and it. a lot of people were in the room with him and of course i've interviewed him many times before so i drew on that as well and observed him. i had a lot of respect for ron and that is his principle. i don't blame him. he turned down a lot of other people to macs or hidden field like a special case there. but the fact that most people were willing to talk and it took a little on her to feel comfortable. if you lose your job, no care what it is comet, just have to kind of look back and discuss it but to their credit all the executives at general motors and chrysler and even at ford came forward and were really, they wanted their story told. i appreciated their trust in their candor because it is an important story. i think people need to realize
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that this was a story of survival. we came very close to losing the american auto industry in this country. and i don't have a firm opinion about the politics. but i do think that the administration and congress ultimately realized that letting these companies fail would have been far more harmful. >> host: arguably it seems to be in manufacturing power. >> guest: for years to come. >> host: we have a couple minutes here. talk about your thoughts on in automotive task force the president obama established. talk a little bit about their work. >> guest: they came together so fast and they accomplish a tremendous amount of in a very short period of time.
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bloom and rattner i spent quite a bit of time with really had, had a total crash course on understanding what these companies were, with their situations were and the whole industry and how it is interrelated and made some very expedient decisions. time was of the essence here. i think the obama administration was under a lot of pressure on two fronts. one, do we give them more money and if we do, what control do we require over them? general motors in particular. the bush administration gave bridge loans which kept him them alive long enough where the obama administration to decide, should they stay alive? and i think they did an extraordinary job on the task force of oiling down to the essence when needed to be done. general motors for example, much
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like allen mullally coming to ford motor company and steve rattner or ron bloom coming from his back and looked at this, how could gm have so many divisions in so many cars that aren't selling, so many unprofitable models? for the longest time gm was reluctant to give up anything. we don't want to give up saturn and we don't want to give up on you. the automotive task force force them to make hard decisions which were the right ones. gm is a smaller company now and a more profitable and more effective company, so i think in a compressed timeframe and the pressure that the task force was under, they really still -- instilled the needs of the companies and what had to be done. in fact taxpayers are going to put up more money, some hard choices have to be made and they really push those. huts kho one thing you dress in address in the book is that
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president obama and the president-elect of the time obama and president bush talked about keeping the companies alive really through the period of transition and you might touch on some of the,, from almost unilateral decisions the president made, that president bush made to ensure that was the case and president obama would be able to then deal with this challenge as he did. >> guest: well president bush from my understanding told mr. obama that i won't turn this to you as a failure. keep this going until you have an opportunity to assess what you want to do with it which is a courageous move on his part. it was sort of against some of his core policies in terms of assisting a private enterprise. but to his credit, think he understood that general motors, liquidating when a new
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administration came in, what the a tremendous burden and a challenge to an economy that was already struggling. president obama, i give them a lot of credit for believing these companies could succeed with assistance. there were a lot of people who said no matter how much money you give general motors, it is a lost cause, it won't turn around. and to his credit, with the right kind of direction and obviously with the financial system, that there was enough talent and commitment and know-how in detroit to succeed. that was a leap of faith on his part i think. it has paid off. these companies are now growing again. they are adding jobs. of course not enough to replace the hundreds of thousands that they lost but this is an
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evolutionary business and right now gm, ford and chrysler are kind of hot again. i just got finished covering the latest round of labor talks and we are adding jobs and it seems that detroit lives to fight another day. >> host: we only have a couple of minutes but they are all successful today but how do they differ today? >> guest: well you know ford motor company by not taking government assistance, this is a decision and an experience that will benefit them for decades to calm. they are the american car company that made it on its own and they should be congratulated for that and the fact is i think it will resonate for years. that is something that some people in america feel very strongly about and they are gravitating to their products. gm is evolving as we speak. new management, changing their product structure, and trying to
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retain that humility that was long in coming. it didn't come overnight and i think it is important for them to remember what almost happened. i think they will be conservative in something is going forward and chrysler -- as though they will regain their position as the world's largest automaker is assuredly this year. >> guest: it is amazing is that? people thought it was done forever and toyota was going to be the biggest company in the industry going forward. gm is back on top. i don't think size is quite as important to their success as focus, and to continue to improve their products and i think the most telling effective gm's rebirth is the number one selling passenger car in the country today is the chevrolet cruise, a small car from general motors. >> host: we have been talking with bill vlasic who is the
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author of "once upon a car." i enjoyed your book and i certainly enjoyed visiting with you. >> guest: thank you very much. i appreciate it. >> that was "after words" but tv signature program in which authors of the latest nonfiction books are interview by journalist policymakers and others familiar with their material. "after words" airs every week and am booktv at 10:00 p.m. on saturday, 12 and 9:00 p.m. on sunday and 12:00 a.m. on monday. you can also watch "after words" on line. go to booktv.org and click on "after words" in the tv series list on the up or right side of the page.
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