January 11, 2010 at 5:32 pm

Daniel Howes

Detroit 3 look to hit reboot key

Forget official titles for this year's North American International Auto Show, opening today to the global auto media.

The real name should be "Detroit after the fall." Its real purpose -- beyond the new metal, the hype, the canned speeches, the sighting of a politician or two -- is the reintroduction of two companies resurrected from the automotive graveyard while showcasing a third, Ford Motor Co., clearly on a path to a brighter future. And the show's real theme is change -- enormous amounts of change.

This is Detroit after its fall, a pitiless unraveling that dramatically changed GM and Chrysler, hardened Ford, tempered suppliers, shocked auto communities and fundamentally changed the Michigan economy. The show marks the official start of the second and arguably final chance for General Motors Co. and Chrysler Group LLC, each slimmer, more focused and under bracingly different leadership than they were last year.

A year ago, GM steadfastly denied its path to revival led through bankruptcy court. A year ago, eight GM brands were just right for the U.S. market. A year ago, Rick Wagoner was the CEO, Fritz Henderson was CEO-in-waiting, and Chapter 11 all but guaranteed a collapse of the industrial Midwest that would claim dozens of suppliers and hundreds of thousands of jobs.

Didn't happen, partly because a new White House rigged the process to make sure it wouldn't. Now, GM is run by a telecom retiree who doesn't know cars; a cadre of tough outside directors oversees management; three surplus brands are being wound down and a fourth is being sold to the Chinese.

A year ago, private equity sharpies controlled Chrysler and pledged better days ahead, but it wasn't true. A year ago, the prospect of the federal government brokering foreign control of a Detroit automaker would have been unlikely -- until the Obama administration contemplated the politically fraught alternative and dialed Fiat SpA.

Is comeback for real?

More than a reintroduction, though, this year's show is a crucial opportunity for the leaders of Detroit's Three -- especially GM and Chrysler -- to begin to answer the most important question of all: Are they charting credible paths to viability, and do their leaders have the energy, vision and toughness to get them there?

The tepid half-measures from Chrysler -- a marathon PowerPoint session in November, no press conference at this year's show -- and the coy cowboyisms of GM CEO Ed Whitacre won't answer questions as much as raise others at a show hungry for evidence Detroit's comeback might be real.

Ideally, today heralds a reboot of Detroit because so many crushing problems have been relegated painfully to the past. Going or gone are massive debt loads, uncompetitive labor costs, surplus brands, bloated work forces and excess dealers.

Even an uncertain future for Cobo Center, the dilapidated home to a show struggling to maintain its place in the top tier of global shows, has been clarified by formation of a regional authority to manage the building and renovate it over time.

GM's balance sheet, a horror of punishing corporate debt, is on its way to becoming the envy of the industry. For the first time, Detroit's labor costs truly are nearing par with the best foreign automakers. Ford is delivering solid quality, an exciting product line, rising U.S. market share and black ink in each region of the world.

That's change we'll take here, epicenter of the worst state economy in the nation for a decade running. In Michigan, the unemployment rate hovers near a nation-leading 15 percent, depending on the month. In Detroit, the jobless rate is twice that, Depression-era levels rarely seen anywhere in the industrial West.

If you can't walk the show floor, look at a floorplan online. Product lines have been winnowed -- no Pontiac, no Saturn, no Saab. There's Maserati -- yes, Maserati -- wedged between Dodge and Jeep. Mazda has been cleaved from Ford, an unmistakable clue that Blue Oval is loosening ties to its longtime Japanese partner.

Auto balance is shifting

Less obvious, but undeniably there, is evidence that a competitive rebalancing may be under way. The newest Asian force, Hyundai-Kia Automotive Group, weathered the global auto recession better than anyone. But Toyota Motor Corp., the so-called Japanese juggernaut, is stumbling with quality problems, massive recalls, first-of-their-kind plant closings and quarterly losses.

The point: Assumptions of where the industry was headed just a few years ago -- Detroit in inexorable decline amid inevitable Asian ascendancy -- are less certain this year than last or the year before that. Triumphalism? Hardly, because it's way too soon to declare a Detroit revival. But the makings are there.

Another point: The newest entrant of NAIAS 2010 isn't another Chinese automaker, it's the federal government. Whatever your politics, the simple fact is that neither GM nor Chrysler likely would be showing a single vehicle at this year's Detroit auto show but for the intervention of Team Obama, the Treasury and, yes, Congress.

Today, House Speaker Nancy Pelosi, D-Calif., and Transportation Secretary Ray LaHood, among others, are expected to tour the show floor. Detroit's fall, and Washington's help with its recapitalization, is yet another stunning shift from a year ago -- proof that the biggest constant now for the new Detroit is historic change.

dchowes@detnews.com">dchowes@detnews.com (313) 222-2106 Daniel Howes' column typically runs Tuesdays, Thursdays and Fridays.

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