So Rick Wagoner is out at General Motors, at the request of the Obama administration. I’ve never known quite to make of the guy—most of GM’s many troubles aren’t his doing at all, but he had eight years to resolve them and came nowhere close to succeeding. I went to Alex Taylor’s November 25 Fortune cover story on GM to see what more I could learn about Wagoner. Turns out Alex kind of likes him, but he did come up with this:
Wagoner’s biggest flaw may be that he has been too forgiving. Here is a company that has lost more than $72 billion in the past four years, and yet you can count on one hand the number of executives who have been reassigned or lost their job. After spending $1 billion to shut down Oldsmobile, Wagoner has allowed GM’s other weak divisions to live on despite their fading resonance in the marketplace. (A competitor says Wagoner is “too fundamentally decent” to cut off dealerships and put their employees on the street. GM says closing divisions isn’t cost-effective.)
What this decision means, I think, is that the Obama auto team doesn’t believe GM can survive in anything remotely like its present form. Wagoner’s whole career was about trying to preserve GM in something like its present form. So much for that.