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Politics | 12/02/2008 11:35 am

PR Stunt or Lesson Learned? GM, Ford CEOs to Drive Hybrid Cars to Washington to Ask for $25B Bailout

By The Staff at wowOwow.com
Wagoner, Nardelli, Mulally © AP

It seems the Big 3 auto CEOs have learned their lesson.

For this week’s trip to Washington to beg for a $25 billion bailout, it’s down with the corporate jets and up with the hybrid cars. Can you say “road trip”?

Ford CEO Alan Mulally will drive the nine hours to the nation’s capital, a Ford spokesman said. His car of choice? A Ford Escape hybrid.

General Motors spokesman Tony Cervone said “it is safe to assume” that company’s CEO, Rick Wagoner, won’t use a company plane, but we’re not sure that means he’s driving. He could just be flying commercial. Or, if you believe this report, Wagoner will drive a Chevrolet Malibu hybrid to Washington. Some of Wagoner’s staff may fly down.

Meanwhile, Chrysler isn’t commenting on the travel plans of its CEO, Robert Nardelli, citing "security" reasons. But we’re pretty sure the corporate jet is out of the question.

During their November 18-19 testimony, Detroit’s auto chiefs were berated by lawmakers for asking taxpayers to foot their industry’s bills, while flying high in expensive planes.

Tuesday is the deadline for Ford, Chrysler and GM to submit a comprehensive plan to Congress on how exactly they would use the $25 billion – or any federal money – loaned to them to keep their businesses afloat. Each company will submit a separate plan. Part of the companies’ plan is to refinance their company’s debt, cut executive pay and seek concessions from workers, among other things.

The kicker to GM’s plan? Wagoner will take a $1-a-year salary. That’s a big pay cut from his 2007 salary of $1.65 million and his 2008 paycheck of $2.2 million. His total compensation has been cut drastically since he took over the company in 2000.

Ford wants a $9 billion loan. In return, it will sell its five corporate jets, and will pay Mulally only $1 a year. He was paid $21 million last year alone. You can see that company’s plan here.

Nardelli of Chrysler told Congress last month he would agree to the idea of a $1 paycheck.

Meanwhile, United Auto Workers leaders have summoned their local union bosses from across the country for an emergency meeting Wednesday in Detroit to discuss what concessions the UAW can make to help the companies get the loans. Those could include a restructuring of the union-administered health-care fund and eliminating the jobs bank, in which laid-off workers keep receiving most of their pay.


14 Reader Comments (so far…) Sign In or Register to comment

Brooklyn Gal
The driving a hybrid is just a stunt. But it’s nice to see the CEO’s taking a paycut (providing they don’t have built into the plan other bonus incentives like stock options and the like that will just make them richer).
By Brooklyn Gal on 12/02/2008 11:50 am
Sandbee (FB) 54
Take It To The Limit One More Time” in one direction or the other. Hope they are going in with real plans this time, not just something to catch attention.
By Sandbee (FB) 54 on 12/02/2008 11:57 am
Belinda Joy
I love the pay cuts, love the fact (they finally got it….even though we all know they only did it because of the embarrassment over the private jet fiasco) they drove there, and love the ideas they have in terms of cutting costs for their respective auto companies.
By Belinda Joy on 12/02/2008 12:11 pm
Diana T
I think they had, what we call here in Kentucky, a Come-To-Jesus-Moment, and , as Belinda said, Got It. Besides, they ought to know that setting a good example is a top-down thing, so if their cars are so great, they could do a lot of educating the public about the virtues of the various vehicles, instead of being obsessed with the Almighty Dollar. Now, perhaps, we can buckle down and help them keep learning their lessons about Real Life, and make some noise ourselves. Part of this problem is the fault of the American People for constantly purchasing the giant, gas guzzling SUVs and trucks. We have participate also to get this country back on track, and start realizing that it is incumbent on all of us to learn to Be Green!
By Diana T on 12/02/2008 12:17 pm
Sandbee (FB) 54
So true Diana, when I look at the streets and freeways of Houston I sometimes think I am still back in Urban Cowboy. They seem to feel they need those huge vehicles even though they are driving alone and carrying no cargo execpt a blackberry.
By Sandbee (FB) 54 on 12/02/2008 12:22 pm
Diana T
And, that, Sandbee, is just as much a part of the problem as the big 3 executives. When are “just plain folks” going to realize that this is their fault, too? We are going to have to start working hard to make up for the past 8 years that we could have been doing something about not only fossil fuels, but in general, cleaning up what’s left of our atmosphere. This is one of Tom Friedman’s premises in his book, Hot,Flat&Crowded—that when manufacturing industries get on the bandwagon, they get very innovative and creative in new ways to get around, to provide energy and to come up with transportation. If we can be a world leader in this area, then once again, we will be leading the world in what we do best. It makes me cringe every time I see a person by himself in a huge SUV that is getting 12 mpg. I raised my kids in a Maverick and a Pinto, and they survived to adulthood….
By Diana T on 12/02/2008 12:36 pm
Sandbee (FB) 54
Was on the road this afternoon about 4-4:45, close enough to rush hour, at least half of vehicles were SUV’s and trucks and both those and cars were almost entirely one passenger (mine included). There is bus service in Houston but no other real mass transit. But I don’t think it would get much use anyhow, it seems to be a point of pride (macho?). Especially in Oil City. I don’t know how it is going to get through to these people that things have to change. In a different matter, but in going green, Mayor Bill White is changing all of the bulbs in the traffic lights to LED ones. This will be a major expense since regular bulbs cost $2.75 and LED are $60.00 but it will save the city $10,000. a day in electric when they are done. So in the long run it will be a savings and much more efficient. So someone here is looking to the future.
By Sandbee (FB) 54 on 12/02/2008 6:01 pm
rocky rocky
I perused Ford’s “plan” (link in article above). I see only generalizations about cutbacks from dealerships to manufacturing management and line workers. Product mix seems to be about the same with some mention of alternative biofuels for the future. Tell me how is that is change worth investing in?
By rocky rocky on 12/02/2008 1:40 pm
EKA -
From what I understand, there are two plans - one for the media,( above) and a much more detailed one for the committee, with specifics. They do not want to let other auto makers know their plans. However, If we are bailing them, ahem, loaning them, them we better be calling the shots and making BIG demands on them. Demand no.1 —- FIRE THEIR ASSES ! ( oops, sorry ! )
By EKA - on 12/02/2008 2:40 pm
rocky rocky
Thank you, EKA. (Love your new photo by the way.) But even with that understood, the “public” plan still does not abate my anger. Even if it was meant to be a general outline, it still should be SHOUTING that there will be an immediate stop to the manufacture of oil/gas-only fueled noncommercial vehicles. So, I’ll double your bid: Fire their BRAZENLY GREEDY A****!
By rocky rocky on 12/02/2008 8:05 pm
James the Game
It’s a stunt, but you can’t slam ‘em for flying corporate on the one hand, and also slam them for driving green. As Walt Sorg at our station asked Fox News reporter Mike Mackowitz this morning, “What if they don’t make it to D.C.?” Ha! A breakdown would’ve been a major possibility with some of the junk-mobiles Ford was hawking in the 1970’s-90’s. Supposedly, Wagoner’s going to tool into town in a Volt, the GM car that goes on the market in 2010. Mackowitz, by the way, pointed out how many Americans’ pensions, mutual funds, etc., would be ruined if the Big Three become no more. The bailout’s going to happen, but will Wagoner & Co. keep their jobs?
By James the Game on 12/02/2008 5:21 pm
John G
Stunt. And unless they’re all in the same Prius for the trip, they’re burning too much gasoline.
By John G on 12/03/2008 9:51 am