CEO Obama?

GM's CEO was fired this past weekend by CEO Barack Obama. Is it "horrible" that the president of the United States (via input by his auto team) fired the head of GM?

Can you fault the government (who is now the largest shareholder) to step in and take steps that the board of directors should have taken LONG AGO?

Think about some of the things that have happened over the past 10 - 20 years at GM (note: Wagoner was CFO back in 1990.....and promoted to President of North America in 1992....and CEO in 2000):

1) Saturn has not earned a dime over its history, and so far GM has not found a buyer, and I sincerely doubt a buyer will be found.....so it will be "folded up" and dissolved.
2) Saab was an acquisition that has not earned a dime.
3) Hummer.....a brand that COULD HAVE BEEN SOLD a few years ago, now can't find a buyer, so it will be folded up and "go away".
4) They made money from FINANCING cars....but not making them.
5) They have fought (as has the whole US car industry) raising the mileage performance of their fleets, while Asian and European car makers continue to raise their mileage performance.
6) They refused to deal with the healthcare cost issue and the pension issue, with the unions early on. Instead, GM has watched their market share continue to slip.
7) GM refused to realize that they had too many brands. I never did understand GM's multi-brand strategy. If you look at someone like Honda or Toyota, their strategy is fairly simple: Brands don't overlap economic boundaries. The Acura brand doesn't compete with their Honda brand. In fact, the Honda brand serves as a "step up" to the Acura brand. The same is true with Scion and Toyota brands (of the Toyota company).

Henry Ford II saw the "coming onslaught" of Asian cars back in 1971, but apparently he didn't see the solution.

"I frankly don't see how we're going to meet the foreign competition," said Henry Ford II, then chairman and CEO of Ford Motor, on May 13, 1971, right after the annual shareholders' meeting. "We've only seen the beginning," he predicted. Regarding Americans' increasing preference for small cars, he declared: "Mini car, mini profits."

It is probably best summed up by the following:

“It’s a pretty unceremonious ending,” said John Casesa, an industry analyst and managing partner of the Casesa Shapiro Group. “G.M. lost its way in the ‘70s, but the company didn’t know it until 20 years later. The hole was much deeper than he realized when he became C.E.O.”

In capital intensive industry's like autos and aviation, bad decisions can be company killers. In GM's case, they have made a string of bad decisions.......and "non-decisions."