Lutz Complains GM Brass Is “Way, Way, Way” Underpaid

With exquisitely bad timing, GM Vice Chairman Bob Lutz informed the Detroit News last Friday that he and his top cohorts were being paid way under market. He vented these opinions as Treasury’s Ken Feinberg was about to review 2010 pay for GM executives. And of course today is Presidents’ Day and the banks are closed, giving the public more time to contemplate last week’s news of still more extravagant Goldman Sachs and JP Morgan bonuses. Good context, Bob.

The fact that the management of GM is being paid anything is incredible to me. They should be working for $1 a year. If they can turn the company around, reward them. But since they are necessarily working hat in hand for the government, how do they come off grumbling about compensation? I mean, if you’re in a homeless shelter, do you complain that the beds aren’t extra-firm?

The other point Lutz made is that low pay cramps GM’s ability to recruit talent against the better-paying competition. No kidding. These guys are lucky to have an office to work out of. Given the whole history of the bankruptcy, I’m reminded of my late mother’s remark: “You should have thought of that when you were in the water!”

Today we learn from the same venue that the bankruptcy fees for lawyers and consultants are predicted to reach $1.17 billion when the case is finally closed, making GM’s the most expensive bankruptcy ever, probably topping Enron’s. The creditors are going to get zilch.

What we should be hearing from Lutz & Co. is how GM is going to pull itself out of this mess and justify the government’s $50 billion investment. Instead, last week he offered that while GM will lose money on its hybrids, it will continue to build them—because it has to. CAFE standards will force carmakers to offset their guzzlers with hybrids, as Inside Line noted. But GM will raise prices on its other cars to compensate for the losses.

Why don’t you guys bend your efforts to making hybrids better and cheaper while selling the public on their obvious benefits? The loss-leader philosophy is one major thing that got the industry in trouble in the first place.

There is a sense in all this that we are watching a badly acted farce unfold. Don’t we have any better playwrights or performers than Bob Lutz?

I wonder if any of you want to take up the cause for Maximum Bob? Please leave us a comment.

—jgoods

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4 Comments

  1. $1 per year perfect pay rate for a mouthy idiot like Lutz if he doesnt like it let him see if anyone else would be stupid enough to hire him. It really takes talent to bankrupt a corporation the size of GM.

  2. @randy
    Randy: If such a firing should ever occur, which is supremely doubtful, I would fly in from Mexico to witness it, gladly. If he were so mustered out, Lutz would probably come back to strafe Milford in his “commie jet.”

  3. My recollections of Bob mainly involve him buzzing GM’s Milford Proving Grounds in his commie jet fighter, flying illegally low and raising the ire of Milford residents living in the area.

    I remain truly baffled that Lutz has been able to keep his job, after all, Bob is responsible for the product mix that resulted in GM’s bankruptcy in the first place. (Remember, they were able to maintain their debt load with a normal sales level, but GM’s mix of gas hogs was the kiss of death when gas hit $4 followed by the recession.)

    I think a unceremonious firing might let a little of the hot air out of Bob’s huge ego, allowing him to be walked out of the building like so many of his previous employees over the past few years.

  4. Until these highly paid for low production on their parts can restore the salaried retirees their benefits that they lost all of a sudden with no warning this past year they don’t deserve much! You get paid for what you produce! They literally lost the company while they were in power and control. You can blame everyone for everything but that’s the truth! Give back to the people what you allowed to slip away. Those are people’s lives and lively-hoods that they messed up. But then I guess they are good at it.eh? These elderly people have no health care to speak of at a time when they need it the most. But of course the idiot in the white house wants it that way to push socialized health care on this nation! If not in this life they will be paying for their greedy ways in the next life! GM executives, I used to have real admiration for them. Now, I trully see them for what they really are…scoundrels and thugs! But I truly hope that they change their ways and do something for those retirees, they are in a world of hurt!

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