C.A.R.S. Management Briefing Seminar - Day 4 Report

By Steve Purdy
Detroit Bureau
The Auto Channel

Traverse City MI August 11, 2006; We’re winding down here in beautiful Traverse City. It’s amazingly quiet as I wrap up this coverage on Friday morning. Anyone who has to fly through a major airport on the way home is bummed. I’m the only one in the press room at 7:45.

Last evening our friends at AutoCom, a PR firm with many auto industry clients, treated us to dinner at the Traverse City Culinary Institute. Michigan wines complimented a gourmet feast in a second floor glass-walled room overlooking the West Bay and the dock where the training boat for the Maritime Institute is moored. We had a spectacular sunset while we talked cars.

Tempered optimism was the mood permeating the week. Like the computer industry, the auto industry is advancing at an exponential pace and some are having trouble keeping up, particularly what we might call the “legacy” manufacturers. The bigger and older the boat, the harder it is to turn.

I understand that the attendance at this important conference is largely dependent on who the key speakers are. Sometimes the top guys from the major OEMs are here and the conference is flush. Other times just the VPs or lesser bosses come and they don’t draw nearly the crowd. This year we’ve seen Mark Fields from Ford, Michigan’s governor Jennifer Granholm, Eric Rideour, COO at the Chrysler Group, and Rick Wagoner Chairman and CEO of GM. Pretty auspicious group, eh?

The Grand Traverse Resort, traditional site of the Management Briefing Seminars, has been abuzz all week with PR folks hustling their clients with the media, business guys and gals trading tech talk and business cards, and the Center for Automotive Research facilitating perhaps the greatest flow of automotive industry knowledge anywhere. I saw one guy shuffling through the stack of business cards collected this week and it must have been an inch-and-a-half thick. I’ll bet I’ve collected a half-inch of cards at least.

The big news on Thursday was Rick Wagoner’s talk. Journalists were listening carefully as if they were investors listening to Allen Greenspan. Preferring the roll of coach to that of king, metaphorically speaking, Wagoner confidently offered the positives: best total retail month of the year in July, holding market share of about 27%, highest revenue on record, improved earnings for 2nd quarter of ’06, and the turn around plan started 14 months ago is on track. He said that the return to profitability as soon as possible is important but changing the way of doing business for the long haul is just as important. Words are cheap, as they say, but I believe the guy. Can he turn the bureaucracy, though?

We car guys were more interested in what he had to say about products. Most of GM’s newest stuff – HHR, Solstice and Sky, Lucern and full-size sport-utes are all doing well indicating GM is on track product-wise. He hinted about major changes coming to the CTS, popular and competent sporty luxury sedan from Cadillac. “Wait ‘till you see what we’re doing with that,” he teased.

Then the tall, lanky Mr. Wagoner let the cat out of the transparent bag (we all saw the cat in there), the official announcement that GM would build a new Camaro, very close to the concept Camaro that has been getting rave reviews since its flashy introduction at January’s Detroit Auto Show. A video clip reminded us that Wagoner had previously said GM would have to be “brain-dead” if they passed on Camaro. When his speech was finished we all reconvened on the patio for fruit smoothies and a look at the sexy, red Camaro mock-up. A knock-out. It will come with three engine options, two V8s and a V6. It will be rear-drive, of course, using an Australian Holdon chassis, with independent rear suspension. And they’ll be coming to dealers full tilt by the first quarter of ‘09. I can’t wait to get my hands on one.

Gary Convis, chairman Toyota Motor Manufacturing, Kentucky, Inc., spent his time blowing Toyota’s horn by describing the efficiency with which they brought the new Camry to market. Remember, this is not just a restyling job or a modest redesign but a major redo. The Winepeg newspaper called the new Camry “The Thrilla that was Vanilla.” Toyota went from 5 to 8 plants around the world building this car. It was the first car that went through Toyota’s new Global Production Center process which involves a centralized information and communication system allowing development processes to be divvied out to different teams around the world. The redesign went from idea to production in just 17 months. More impressively, changeover from the old Camry to the new took as little as 90 minutes in some plants.

Toyota, though, is not without challenges. Recent recalls and some quality problems have tarnished the blemish-free image. There’s no reason to think, however, that their progress toward world dominance will slow.

So, we media guys and gals have had a good time with the big news this week. Those thousand engineers and business guys and gals out there have shared ideas, made contacts, and been reinvigorated to push the automobile into a future of more electronics, alternative fuels, creative business arrangements, and products so advanced we may not even recognize them in another 10 years. Today the energy in Traverse City will dissipate but the information shared here will ripple through the entire industry.