Once Upon a Car

The Fall and Resurrection of America's Big Three Automakers—GM, Ford, and Chrysler

Bill Vlasic

• Publisher: William Morrow
• Year: 2011
• Print ISBN:
  9780061845635
• eBook ISBN:
  9780062042224
• Topic: Business
• Subtopic: Automobile Industry
• Index: Business

Once Upon a Car is the brilliantly reported inside-the-boardrooms-and-factories story of Detroit's fight for survival, going beyond the headlines to chronicle how the country's Big Three auto companies—General Motors, Ford, and Chrysler—teetered on the brink of collapse during the 2008 financial crisis. In a tale that reads like a corporate thriller, Bill Vlasic, who has covered the auto industry for more than fifteen years, first for the Detroit News and now for the New York Times, takes readers into the executive offices, assembly plants, and union halls to introduce a cast of memorable characters, many of whom are speaking out for the first time, including the executives who struggled to save their companies but in the end had to seek a controversial, last-gasp rescue from the U.S. government.

Vlasic goes behind the scenes to portray the men at the top during Detroit's last stand. Rick Wagoner, the CEO of General Motors, tried to turn around a dying company, only to be forced to resign as a condition of the government bailout. Bill Ford, great-grandson of the legendary Henry Ford, had the will to keep Ford alive but needed the guts to hire an unknown outsider, Alan Mulally, to transform the company before it crashed. At Chrysler, leadership was constantly changing as new owners tried in vain to fix the smallest of the beleaguered Big Three. And through it all, the president of the United Auto Workers union, Ron Gettelfinger, fought to save the jobs of the men and women who build American-made cars and trucks.

This tale of an iconic industry in crisis is more than a big business drama and provides a rich, unvarnished portrait of how Detroit's decline affected tens of thousands of workers and dozens of communities nationwide. The story moves from the gleaming corporate skyscrapers and massive auto plants to the halls of the U.S. Congress and into the Oval Office, where President Obama and his aides wrestled with how to keep General Motors and Chrysler from going out of business. Vlasic shows why the bailout worked, and how Detroit can succeed under new leadership and build automobiles equal to any in the world.

Once Upon a Car tells a uniquely American tale of success, failure, and redemption. It is an important and illuminating chapter in an astonishing story that is still unfolding. And no one is more qualified to write it than Bill Vlasic.

Chapter One

Larry Buhl had been planning this rendezvous for months, and today was finally the day.

It was the second week in January, and the 2005 North American International Auto Show was in full swing in downtown Detroit. The Cobo Center convention floor, bigger than a dozen football fields, was a mass of people roaming like herds among the exhibits of the world’s biggest automakers. The elaborate displays of the hometown giants, General Motors and Ford, owned one side of the hall. The German luxury brands Mercedes-Benz and BMW anchored the other end.

And somewhere in the middle was the man Buhl was looking for.

He walked along the carpeted paths between the million-dollar show stands, each one reflecting the company behind it—sleek and futuristic at Honda and Nissan, lots of chrome and bright colors at Dodge and Chrysler, stark backdrops and pretty women in slinky dresses at Ferrari and Lamborghini. Cars of every size and shape were bathed in bright spotlights, polished and posed for the hordes of journalists and camera crews and auto executives that swarmed around the hall.

Buhl felt right at home. He lived in Connecticut but had grown up just down the road in Grosse Pointe, Michigan. He had been going to the show for years. It was like an extension of the holidays in Detroit—Christmas, New Year’s, auto show. It was also the perfect place to blend into a crowd and meet someone unnoticed. Buhl crossed the convention floor, took a turn behind the man-made mountain with a Jeep hanging off it, made a left at the Toyota exhibit, and spied the smallest, plainest stand in the entire place—three quirky little cars surrounded by college-age sales reps in polo shirts and khakis. And there, working by the red Scion sign, was Jim Farley.

Since last summer, Buhl had been trying to set up a meeting between Farley, a rising executive at Toyota and head of its new Scion division, and one of Buhl’s oldest friends, William Clay Ford Jr., the chairman and chief executive officer of the Ford Motor Company. The idea came to Buhl during a conversation with Farley’s father on a golf course in northern Michigan, where the Farley and Buhl families had owned vacation homes for years. “Something struck me when I saw Jim’s dad,” Buhl recalled. “I thought Ford could really use a guy like Jim.”

Larry Buhl had known Bill Ford since they were kids. They went to private schools together, played the same sports, socialized throughout college, and stayed close into their mid-forties. One went on to become a successful entrepreneur buying and selling specialty metals on the East Coast. The other became the leader of the second-biggest car company in the world.

Buhl cherished their bond, but lately he had been worried about his friend. He saw what the pressure of running the Ford Motor Company, his family’s business for more than a hundred years, was doing to Bill. Executives came and went at Ford headquarters, but none of them was able to help Bill stave off the flood of Toyotas, Hondas, and other foreign cars that were relentlessly beating Ford in the market. Buhl saw Bill’s spirits sag when they talked about it. “It’s too much for you,” he kept telling him. “How can you shoulder all of this responsibility yourself?”

What Ford needed was fresh blood. Buhl would never be so presumptuous as to suggest to Bill that he hire Jim Farley. But if he could get the two of them together, who knew what might happen? When he brought it up, Bill said sure, he was open to it. It was a little trickier to convince Farley. Buhl’s brother Robbie, a professional race car driver and fellow car fanatic, had been tight with Farley for years. Still, when Buhl called Farley, he was cool to the idea of sitting down with anyone at one of Toyota’s biggest competitors.

“I’m not interested in going anyplace,” Farley said. “I’m really happy at Toyota.”

“Come on,” Buhl said. “I’m just talking about introducing you to a friend of mine.”

“I don’t feel comfortable about this,” Farley said. “Things are going so well for us, and for me.”

“You have to meet him,” Buhl said.

“Why?”

“Because,” Buhl said, “it’s good for you.”

Now as he walked toward the Scion stand, Buhl still didn’t know if Farley would ever consider leaving Toyota. What he did know was that Jim Farley could sell cars as well as anyone on the planet.

And he was proving it every day. In just two years, Farley had grown Toyota’s new Scion brand, created specifically for younger buyers, from zero sales in the United States to 100,000 vehicles a year. His bosses in Japan and in Los Angeles had entrusted him to somehow make bland and reliable Toyota hip, and he embraced the challenge. Farley took Scion cars to rock concerts, street festivals, and college campuses—anywhere that Generation Y hung out. He was constantly on the road, setting up Scion showrooms inside existing Toyota dealerships, and making them cool, pressure-free boutiques for these interesting little Japanese cars with funky designs and small engines.

Farley inhabited the job completely—hanging out with twentysomething trendsetters on the coasts, learning why they chose their favorite products, from computers to clothes to cars. “You need to love your customer, feel their joy, understand their pain,” he said. “You have to get so close to them you can smell their breath.”

But as sensitive and idealistic as he sounded, Farley had an edge to him. Other automakers were the enemy vying for the same turf, and Farley would never give an inch. When he heard that Bob Lutz, the vice chairman of General Motors, had called the shoebox-shaped Scion xB “weird-looking,” those were fighting words. “I could care less about Detroit,” Farley said. “Give me a break. Detroit got its ass kicked trying to market to kids.”

At the Scion stand, Farley was in his element—chatting up reporters, showing off the cars, greeting visitors. With a mop of brown hair flopped over his forehead and wearing a suit that looked just a size too big, Farley seemed younger than his forty-two years. He also was having way more fun than the buttoned-down, deadly serious executives holding court at the other displays. The media flocked to him, and he rarely disappointed. He was provocative, blunt, and unafraid to criticize an older generation’s view of today’s young consumer. “These kids are not Camaro buyers from the seventies being reincarnated,” he said. “These people are sharp. They have higher expectations.” He said it all with a mischievous smile that called to mind his late cousin, the comedian Chris Farley of Saturday Night Live fame. He even sounded like Chris, especially when he laughed.

When he saw Buhl walking up, Farley greeted him warmly, like the old family friend he was. They walked across the convention floor together and into the busy hallway dominated by a big bronze statue of the boxer Joe Louis, the embodiment of Motor City muscle. The second they entered the parking garage, Farley started shivering, the bitter chill of January in Detroit a reality check for a guy who lived and worked in Southern California. They hustled to Buhl’s car and headed out onto Michigan Avenue, six lanes of blacktop bisecting some of the city’s bleakest neighborhoods, and into the adjoining community of Dearborn, the home of the Ford Motor Company.

Farley was quiet as they passed the falafel joints, strip clubs, and discount stores that lined the wide avenue. In the distance he could see the belching smokestacks of Ford’s famous Rouge assembly complex, stretching more than a mile long and wide, with dozens of factories, some dating back to the 1920s. The heavy gray cloud cover seemed to sit on top of the buildings, and everything looked frozen solid. I’m from Santa Monica, I work in Torrance, I go to Toyota City in Japan, Farley said to himself. That’s my auto industry. This is just so . . . old.

Why would he want to meet anybody at Ford? Farley lived and breathed Toyota. He had loved the company from the day he joined it fifteen years earlier, when Toyota was an underdog fighting for respect in the American market. Farley had basically devoted his life to winning customers away from what he saw as declining, inferior carmakers such as Ford. To Farley, the car business was a highly refined arena of combat, and he had no doubt he was on the winning side. “We’re the good guys, the ones wearing the white hats,” he said. Farley believed that Toyota made the safest and most sensible, affordable, and fuel-efficient cars in the world. Ford was a dinosaur that lived on an unsustainable diet of gas-guzzling pickup trucks and monster SUVs. There was no question which company was growing and which one was fading. In a few days the final numbers for 2004 would make it official. Toyota had just passed Ford in global sales and was fast closing in on the number one spot, held for more than seventy years by the biggest of Detroit’s Big Three, General Motors.

When he agreed to this meeting, Farley had made Buhl promise that it would be in secret, far from the auto show and certainly not at Ford’s corporate headquarters. It wasn’t exactly treasonous for an up-and-coming Toyota exec to get to know the major players in Detroit better, and there was no one bigger in Detroit than Bill Ford. But Farley was a little worried that someone would recognize him and that word might get back to his colleagues at Toyota.

He relaxed when they arrived at the spot for this clandestine get-together—the sprawling $35 million headquarters and training camp that Bill Ford’s father, William Clay Ford Sr., had built for his beloved Detroit Lions football team in the suburban city of Allen Park. The Lions were never doing much in January. Their season had ended weeks earlier, as usual, with a losing record and another year in which they were shut out of the playoffs. The place was pretty quiet with all the players gone. At least, Farley thought, no one would see him here. They walked in the main entrance and checked in at the desk in front of a wall-size mural of great Lions players of the past. As they approached the executive offices, Buhl started getting a little nervous. This was, after all, his idea. Should he just make introductions and offer to wait outside? He suddenly realized he didn’t know Farley as well as he knew Bill.

Just then, Bill Ford bounded out of his office to greet them. Farley was immediately struck by how young he was—just five years older than him—and how animated and friendly. Bill was of average height and trim like a runner, his custom-tailored blue suit accenting strikingly blue eyes. He had a way of talking fast, like he couldn’t wait to share an idea or a story. The three of them sat down and, in a flash, Bill was talking about Ford—its history, its people, and how much it meant to him. “The passion I have for this company is making people’s lives better,” he said. “It’s up to us, up to me, to look to the future.”

Farley just listened as Bill went on about his family—which had absolute power over Ford through its special voting stock—and its unwavering commitment to the car business.

“We’ve definitely taken our lumps, but it’s never been about the financial investment,” Bill said. “We’re in it for the long term.”

Buhl kept eyeing Farley, who seemed transfixed. He could sense Farley’s mind racing, waiting for the right opportunity to jump into the conversation. When Bill finally asked him about his new Scion job, Farley was a bit defensive at first.

“You know, I’ve been with Toyota for fifteen years,” he said. “I’ve been in marketing and sales in Europe. I was the first product planner for Lexus. I laid out the whole product plan for Lexus with the engineering team in Japan.”

Now Bill was the attentive one, nodding and asking follow-up questions and probing for more information. After a few minutes, Farley felt completely at ease. He had met a lot of auto executives in his career, but Bill was not like any of them. “It wasn’t like he was happy-go-lucky, but he had a joie de vivre about him,” Farley said later. “He loved certain things.”

When the two of them started comparing their favorite classic cars, in particular the Ford Mustang, Buhl couldn’t help but smile. I’ve never seen such an instant rapport, he thought. It’s just two guys talking about their passion for automobiles and the business.

The discussion turned to marketing, Farley’s specialty, and Bill made a joke about Ford’s latest generic advertising campaign, “Built for the Road Ahead.” Farley had to laugh. He and his Toyota buddies thought it was one of the lamest ad slogans they’d ever heard.

Then, out of the blue, Bill popped the question. “What would you do if you were running it?” he asked Farley.

Okay, Farley thought, here’s the sales pitch. “Well, I’m not interested in going to Ford,” he said.

Bill acted as if he hadn’t heard him.

“You know, I need help,” he said softly. “We’re looking for someone who can help.”

Farley was taken aback. He wasn’t sure he’d heard him right. Bill Ford was asking for his help? There was vulnerability in his voice, a raw honesty that Farley hadn’t anticipated. He wondered where the pressure was, the hard sell, the lucrative financial carrot he’d expected to be dangled to lure him to Ford. But it never came.

The hour passed quickly, and Buhl barely said a word. When they all got up and shook hands at the end, Bill held his grip with Farley a little long, then pulled a card from his pocket.

“I think there’s a place for you here,” he said to Farley. “Here’s my number. Let’s stay in touch. I want you to call me. I want you to know that I’m here whenever you need me.”

Buhl did most of the talking on the drive back downtown, hardly able to contain his enthusiasm over how well it all had gone. But Farley didn’t hear much of it. The words “whenever you need me” were stuck in his head.

Whenever I need him? Who, Farley wondered, needs who here?

Chapter Two

Rick Wagoner never gave a speech without checking and rechecking every word he said as the chairman and chief executive officer of the General Motors Corporation. He not only pored over speeches but scrutinized any press release, document, letter, or internal communication that his aides drafted in his name. Wagoner was particularly attentive to quotes attributed to him. “I don’t want to ever say anything publicly that I might have to retract,” he told his staff. He had another hard-and-fast rule, a mantra drilled into him by Jack Smith, his mentor and predecessor as the top man at the biggest car company the world had ever seen. “We don’t want to ever overpromise,” he said, “and underdeliver.”

As Farley was heading back to the auto show after meeting Bill Ford, Wagoner was preparing to leave it. The “GM Experience” at the show was—no surprise—the grandest corporate display in the hall. More than a hundred cars, trucks, and sport-utility vehicles were decked out on the floor, and each of GM’s eight North American brands, from mighty Chevrolet down to the tiny Saab division, had its own special area. In one corner was a large stage with a giant movie screen behind it for the gala press events to introduce new models. Above the stage was a full second floor that doubled as a showroom for new technology and a coffee bar or cocktail lounge, depending on the hour.

Wagoner was working in a temporary office hidden behind a thick black curtain near the stage set. Most of GM’s senior executives had rooms there to do interviews, hold private meetings, and generally conduct business. General Motors hardly stopped running during the weeklong media previews. It just relocated its command center to the row of drafty cubicles that backed up against the convention center’s loading docks.

The press conferences were over, but there was one last show-related duty to attend to. In midafternoon on January 13, 2005, Wagoner, along with all the other senior GM executives, marched out of the building onto Jefferson Avenue. Waiting for them at the curb was a line of very large sport-utility vehicles—Chevrolet Suburbans, GMC Yukons, and Cadillac Escalades—with their V-8 engines idling. GM sold nearly nine million vehicles each year. But these giant SUVs were the pride of the fleet—eighteen-foot-long, seven-thousand-pound, seven-passenger land yachts with every option known to man. Wagoner got in the first one, a black Escalade ESV with a GM driver behind the wheel. As always, he rode shotgun, up front in the deep leather passenger seat.

As the caravan pulled out, Wagoner reviewed the speech he was about to give. In twenty minutes he would walk into a hotel ballroom and address the Auto Analysts of New York, the watchdogs of the auto industry for the major investment banks on Wall Street. Their research reports were critical factors in daily decisions by investors to buy, sell, or hold a stock. Wagoner knew his remarks this afternoon would generate instant headlines and directly affect the value of the 564 million shares of stock that constituted ownership of General Motors.

If there was ever a time to watch his words carefully, this was it. GM had already endured a rough week in the stock market. Its share price had fallen for four straight days. The Street had not been this worried about the company’s financial condition since the early 1990s, when GM came close to bankruptcy, fired its chief executive, and embarked on a seemingly endless series of restructurings. The automaker sold an average of twenty-four thousand cars each day in two hundred countries. But it was operating on razor-thin margins of profitability. Investors had a bad case of the jitters about GM. It was up to Wagoner to calm them down.

Six foot four, broad-shouldered, and wearing his usual pinstriped suit, white shirt, and solid tie, George Richard Wagoner Jr. cut an impressive figure. He had a long, serious face: high forehead, big chin, and jowly neck that looked out of place on a fit former college basketball player who would turn fifty-two years old in a month.

Wagoner stood ramrod straight and spoke in flat, even tones, with a slight southern accent from his Virginia upbringing. In public settings, he was un...

Table of contents

• Cover
• Title Page
• Dedication
• Contents
• Chapter One
• Chapter Two
• Chapter Three
• Chapter Four
• Chapter Five
• Chapter Six
• Chapter Seven
• Chapter Eight
• Chapter Nine
• Chapter Ten
• Chapter Eleven
• Chapter Twelve
• Chapter Thirteen
• Chapter Fourteen
• Chapter Fifteen
• Chapter Sixteen
• Chapter Seventeen
• Chapter Eighteen
• Chapter Nineteen
• Chapter Twenty
• Chapter Twenty-One
• Chapter Twenty-Two
• Chapter Twenty-Three
• Chapter Twenty-Four
• Chapter Twenty-Five
• Chapter Twenty-Six
• Chapter Twenty-Seven
• Chapter Twenty-Eight
• Chapter Twenty-Nine
• Chapter Thirty
• Chapter Thirty-One
• Chapter Thirty-Two
• Author’s Note
• Index
• About the Author
• Also by Bill Vlasic
• Credits
• Copyright
• About the Publisher