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Bob Lutz More Powerful Than Ever
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Posted by Ian Glenday [Email] (#95) [Profile/Gallery] (more from Ian Glenday) on Tue, 5 Apr 2005 20:45:49 Share Post by Email
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Quotes from the WSJ on Bob Lutz's new duties.

"Under a reorganization launched last month, GM has transformed itself from what amounted to a holding company for four, self-contained and quasi-independent regional car makers -- GM North America, GM Europe, GM Latin America and GM Asia-Pacific -- into a single company with major functions such as vehicle design and engineering and manufacturing reporting to one executive. For example, Vice Chairman Robert Lutz, who was formerly chairman of GM North America, now has direct authority for all vehicle development world-wide -- including much of GM's roughly $8 billion capital investment budget.


Where previously Mr. Lutz, as vice chairman for global product development, would have to cajole regional presidents to agree to make similar-sized vehicles using the same components and engineering standards, or allocate people assigned to their budgets to work on a project outside their regions, he now can mandate product and component sharing. During a presentation last month to investors at a conference hosted by Morgan Stanley auto analyst Stephen Girsky, Mr. Lutz said this should generate substantial cost savings for GM. The costs for new seats for the successor to the current Chevrolet Malibu, under development as part of a global program, are coming in 70% below the current model, he said.

Mr. Lutz explained that under the previous structure, GM's North American design chief, Ed Welburn was trying to hire 50 designers even as a GM design staff in another part of the world was laying off 10 designers.

The management overhaul also weakens the clout of GM's regional heads and strengthens that of Mr. Lutz. That could create some power clashes. "He's a very autocratic guy," says Warren Bennis, a University of Southern California business professor and author of several leadership books. Executives with shrunken power bases "will have a hard time reporting to him."" 

_______________________________________
Ian
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