EDITORIAL
Our view: GM led in early days, then didn't keep up
Wednesday, June 04, 2008
This year marks the 50th anniversary of Dayton's Charles F. Kettering's death.
You'd like to think that Rick Wagoner Jr., GM's chairman, didn't know that connection when he announced Tuesday, June 3, that GM is planning to sever its almost century-long relationship with the Dayton community, closing its Moraine assembly plant and pulling out 2,000 jobs.
Extras
Mr. Kettering, long GM's director of research, was a venerated figure at the company and in its history. The inventor of the self-starter and dozens of other important automotive innovations, he would be devastated to see the tie cut; maybe it wouldn't have been if he were still on the company's board.
But much has changed between Dayton and GM over the years. The postwar days when Dayton and Detroit were inextricably linked, and upward of 30,000 Daytonians worked for GM, are part of a distant past. When the company spun off its Delphi operations in 1999, that really reduced the association, leaving just the Moraine plant.
Everyone knows the explanations: the U.S. auto industry has been buffeted by foreign competition and the market has changed — dramatically.
When people worried about losing the Moraine plant — and worried they have been — supporters pointed to the fact that the operation had a terrific reputation for turning out quality SUVs and trucks. GM had a good relationship with the International Union of Electronic Workers-Communication Workers of America Local 798. And local governments, the state of Ohio and the Kettering school district have been nothing but generous and cooperative for years, as the company's North American operations have struggled.
When a local delegation went to GM headquarters this spring to encourage GM to bring a new product line here, they made sure they talked about the past — distant and recent. After meeting with officials, they came back hopeful that Dayton's history, in every sense of the word, might serve it well as GM considered how to cut its overall production and move toward smaller cars.
On Tuesday, Mr Wagoner dashed those hopes.
When asked before the company's annual meeting if there was any possibility about reconsidering the Moraine decision, Mr. Wagoner said, "We really would not foresee the likely prospect of new products in the plants we've announced. As we sit here today, it would be inaccurate for me to leave you with a lot of optimism."
Mr. Wagoner went on, "In the last quarter of last year, we sold, on average, over 102,000, 105,000, large pickups and utilities per month. Over the last few months, that has dropped to 65,000 units. Even in the first quarter, we didn't see that kind of shift."
Gas prices of $4-a-gallon have tremendously accelerated consumers' jump to smaller, more fuel-efficient vehicles, and GM has few of those to offer.
That failure has cost GM mightily — leaving it with just 20 percent of the U.S. market. A decade ago, it had a 29 percent share; years ago it had 50 percent.
Mr. Kettering, who could be prickly, most likely would not be kind in his judgment of GM's misjudgments (though, in fairness, it has made some big changes).
A 1983 New York Times review of "The Dream Maker: William C. Durant, Founder of General Motors'' noted that Boss Kett (who retired in 1947) "once charged a task group working on fuel performance to study the problem 'without any immediate industrial implications' and treat it as 'our intellectual golf game.' And when his better fuels were used simply to produce surplus horsepower to market, he complained, 'Well, I am nothing but a goddamn salesman.' "
A second 1983 Times review of another book, "Boss Kettering," by Stuart W. Leslie, noted this about Mr. Kettering:
"More than 50 years ago he stressed the need for fuel conservation and fuel-efficient engines, and he urged his engineering colleagues to study alternative fuel sources. When GM President Alfred Sloan would not finance research into the possibility of converting organic materials directly into automotive fuels, because it had no immediate commercial objective, Kettering paid the cost of maintaining a greenhouse for just that purpose."
State and local officials shouldn't just yet give up in their fight to bring a new product line to Moraine. But they have to know that GM's options are painfully limited. At some point, they most likely will have to shift their focus to the families who will need new jobs in 2010 — maybe sooner.
Those workers' world has been turned upside down. Giving them false hope — and looking back instead of forward — isn't going to help them pick up the pieces.
