The ink is barely dry on General Motors Corp.'s bankruptcy filing and already there are predictions the hobbled automaker is doomed -- not including the potential pitfalls of being government owned.
There's the steady market share slide to roughly 19 percent from supplying half the nation's cars and trucks little more than a generation ago. There's the stunning cash burn. There are not enough models that "people want to buy" and the biggest bogeyman of all -- an insular culture incapable of self-criticism and meeting competitive threats.
All of it, and more, is offered as proof that GM's bankruptcy is but a government-sanctioned pause on the way to complete collapse. Except there's one powerful counterargument to that gloomy script of inevitable Detroit decline -- Ford Motor Co., the cross-town rival little more than two years ago given up for dead, mortgaged to the hilt, dumping brands and bleeding market share.
The Blue Oval is on its way back. Its share of the bellwether U.S. market hit 17.4 percent last month, up from 15.2 percent a year ago. It's leaner and more focused, having jettisoned three European brands, sold down its stake in Mazda, and is again shopping its Volvo Cars unit of Sweden.
Its new cars and trucks are wowing critics. The fuel economy of its new Fusion hybrid outperforms anything from Japan's Big Three, and more fuel-efficient models are coming. The new Ford is opportunistic, pressing to reduce debt, to cut money-saving deals with the United Auto Workers, to score PR points with the reality of plant reopenings and increased production.
And it all shows in Ford's share price, more than tripled to $6.15 Wednesday from $1.70 in early March.
Most importantly, an insular Ford culture prone to Byzantine politicking, abrupt firings and practicing way too much "not invented here" rejectionism now is more disciplined, stable and cohesive. Credit all those outsiders imported by Executive Chairman Bill Ford Jr. -- all two of them.
No question CEO Alan Mulally, wooed to Ford's top job in September 2006 after 31 years at Boeing Co., is the architect of Ford's incipient turn. No question, either, that he's using Blue Oval lifers (with the obvious exception of Toyota wunderkind Jim Farley) to methodically restructure Ford, effectively countering the notion that Detroit and its culture simply cannot navigate the hyper-competitive global auto industry without a massive infusion of outsiders.
Not true, so long as two things exist: First, a mortal threat to the continued viability of the enterprise, as Nissan Motor Co. faced a decade ago, Ford faced three years ago and GM undeniably faces today. Second, a leader and core leadership team that consistently, clearly, directly, repeatedly, privately and publicly use the crisis to motivate, push, lead, clarify and, yes, dismantle parts of the company and its culture.
It can work, particularly in organizations that recognize their only other option is certain oblivion. Ten years ago, skeptics -- including me -- ridiculed the notion of an alliance between Nissan and Renault SA, arguing that the Franco-Japanese tie-up would be torn apart by cultural conflict and national pride.
What the critics didn't appreciate, then-Renault Chairman Louis Schweitzer once explained, was that debt-ridden Nissan's leadership knew its organization had to accede to radical change or the automaker would fail.
Which gets back to GM. The bankrupt automaker a) clearly faces an existential threat and b) possesses key senior leaders -- chiefly in CEO Fritz Henderson and CFO Ray Young -- who have demonstrated records of success, much of it in GM jobs outside the States. Are they outsiders like Ford's Mulally, who led the revival of Boeing's commercial aviation unit after the September 11 terrorist attacks?
No. Do they have to be? Not if the past 60 days are any indication. Love 'em or hate 'em (and a lot of folks hate 'em right now), Henderson, Young and President Barack Obama's auto task force are setting in motion the most radical reshaping of any Detroit automaker in decades, if not ever -- the kind of change so many of GM's critics demanded but thought they would never see.
Four brands going or gone. A controlling stake in GM's Adam Opel GmbH unit in Germany sold to Germans and Russians. Fewer plants, fewer people and more than 2,000 dealers set to be eliminated. A tighter focus on GM's strongest brands in its home market -- Chevrolet and Cadillac -- and those with the most reach in developing markets -- Chevy and Buick, particularly in China.
Could GM's U.S. business never emerge from Chapter 11 bankruptcy, even as the rest of its global empire continues to operate as usual? Of course, but I wouldn't bet on it given the presidential power behind the effort. Could Henderson and his leadership team, several of whom likely will be reassigned or cashiered within the next two months, fail where Mulally and his Ford lifers appear to be succeeding?
Sure. But there is a Detroit way that works -- in Dearborn.