THE DETROIT EXECUTIVE MINDSET GETS DERAILED. AGAIN.

By Peter M. DeLorenzo

Detroit. I don’t think it’s much of a secret that I really don’t care for the direction this business is going right now. The headlong rush in pursuit of “mobility” has automobile companies and suppliers burning money at a furious rate to the detriment of future product programs, and it stinks. 

I listen to the rhetoric spewed by some of the leaders of these companies, and it makes me cringe, because everyone is predicting the coming autonomous Nirvana with such confidence that you just know the reality is going to be far less than predicted or imagined. And it’s going to be the ruination of some of these auto companies and suppliers, with some being forced to merge or even worse, be forced right out of existence because of the fanciful decisions being made right now.

When I see full-grown automobile companies touting their investments in scooters and electric bikes, then it’s time to start taking everything they do and say not with a grain of salt, but with an entire salt mine. This isn’t prudent thinking, this is a bunch of allegedly smart people throwing everything plus the kitchen sink up against the wall to see what sticks. These auto company honchos are running so scared at this juncture that it’s flat-out frightening to watch, because these decisions aren’t being made with clear minds, they’re being made while clouded by delusions of grandeur and thoughts of unlimited profit potential that internal and external futurists are predicting.

But the chaos doesn’t stop there. With the auto companies properly chastened by what happened in The Great Recession that wreaked havoc on the industry beginning in 2008, they’re now trying to be smart by getting out in front of the next one looming off on the horizon. This is commendable, at least on the surface, but the reality of this bunker mentality is that horrendous mistakes are being made as you read this. 

GM wants to get 18,000 employees to take an early buyout and go away, and I have it on good authority that many key people in design and engineering have gotten “the nudge” to get out. The problem with this is that this may cause a brain drain that this company might never recover from. It’s fine to hire endless young techies for the coming electric/AI future – even though AI is decades away and electrification hasn’t captured the fancy of the auto buying consumer populace as of yet – but with ICEs (internal combustion engines) being around for the foreseeable future, exiting men and women who actually understand how to design and engineer machines that real people will actually want to buy for the next three decades at least is a skill that cannot be overestimated. GM management is trying to look smart in all of this, but I see a looming disaster on the horizon as they exit True Believers en masse and decimate the company by leaving a skeleton crew of inexperienced people with no mentors and no guidance to get things done.

Why is this happening? Mary Barra and Dan “I Am” Ammann want to look golden for the denizens of Wall Street, demonstrating that they indeed do have it goin’ on and that GM’s stock price should be rewarded because of it. Because after all, they’re getting way out ahead of the coming slowdown by demonstrating their fiscal acuity. But is that what’s really happening here? No, of course not. These two have also deluded themselves into thinking that with the coming Mobility Revolution, “old” automotive manufacturing skills won’t be needed because they will be replaced by new people with new skills, and in order to attract these people they will have to appear hip and relevant to a new generation of employees who will churn out digitally acceptable transportation devices with unbridled abandon.

The Valley of Silicon’s effect on the automobile companies and their executives has been a sight to behold, and in the most negative way possible too. Tired of being pummeled by the most virulent strain of Washington bureaucrats in this nation’s history, and tired of being perceived as perpetually unhip, uncool and even worse – obsolete and outdated – especially in comparison to the West Coast Digital Intelligentsia, the Detroit executive mindset (and I am including all auto companies in this description) has gone completely off of the rails.

And they’re striking back with a fury, except that in many instances that fury is misguided and marked by highly questionable decisions that will come back to bite them in the ass, hard. Yes, I am acutely aware that in our Digitized Future IT will rule and IT minions will inherit the earth, but this is getting ridiculous. The collective Detroit “mindset” has completely forgotten what its role should be and will be when it comes to the future of mobility. 

Let’s not forget that the one thing that the Masters of The Universe out in the Valley of Silicon have come to respect and marvel at about “Detroit” is just how relentlessly complicated designing, engineering and manufacturing vehicles that not only work and perform with remarkable reliability but do so while complying with international safety and emissions standards really is. It is one of the most challenging business pursuits on earth, and to do it while delivering a modicum of profitability makes it all that more difficult. 

I appreciate the challenges facing the auto company executives, and just how much they are determined to be part of the Future of Mobility, but to entirely lose their collective minds in the process is inexcusable.

They need to be reminded that what they do is a unique pursuit, and to create machines that are reliable, efficient, and perform well to their stated missions while being compelling to look at is a calling still worth pursuing, one that isn’t going to become obsolete anytime soon. 

Memo to auto executives: Leave the eBikes and the meBikes to the others – and get back to work.

And that’s the High-Octane Truth for this week.