Posted on 11/21/2008 9:03:20 AM PST by Sub-Driver
GM to return two leased jets amid criticism By Poornima Gupta Poornima Gupta 12 mins ago
DETROIT (Reuters) – General Motors Corp will return two of its leased corporate jets amid intense criticism in Washington this week on the luxury travel arrangements of its chief executive even as the company pleads for federal aid.
CEO Rick Wagoner was in the capital to testify on the company's dire financial situation but his testimony was overshadowed by irate lawmakers who blasted him for flying on a private jet to ask for public funds and failing to make personal sacrifices in exchange for federal assistance.
Chief executives from Ford Motor Co, and Chrysler LLC, who were also there to plead for $25 billion in federal aid, came under fire too for flying to Washington in private jets.
GM spokesman Tom Wilkinson said on Friday GM decided to return the aircraft because of a "really aggressive cutback in travel."
The company, which is in a cost-cutting mode, is scrutinizing every trip, he said, but declined to disclose the name of the company it leases the airplanes from.
Wilkinson said the decision to return the leased corporate jets was made before this week's hearings and that the company in September returned two other of the seven jets it had at the beginning of the year.
"There is a perception issue," Wilkinson said of Wagoner's travel to Washington on a private jet. "We need to be very sensitive to that going forward."
(Excerpt) Read more at news.yahoo.com ...
It is certainly arguable whether Mr Wagoner is worth the $3.36 million he is paid each year (http://finance.yahoo.com/q/pr?s=GM ) or whether GM should be asking for or getting a bailout. However, IF he is going to do these things as GM’s CEO and ask for a bailout, he should do it in a cost effective manner. For someone at his pay level, it probably makes no more sense for him to waste time waiting to board a commercial flt (and presumably get less done on the flt) than it does for him to sweep the floor of his office and empty his own trash.
Truth be told, companies that are hemorrhaging cash need to make sacrifices to survive. That includes at the executive level. Taking the company jet to go beg for money is beyond the pale. Northworst Airlines hubs out of Detroit, so getting a first class nonstop to IAD or DCA is not an issue.
Executives don't answer their own phones or read their own mail. There are CrackBerries and laptops for these clowns to whatever crisis that can't be resolved by anyone but the CEO.
These guys are arrogant. The rules that all of their employees follow don't apply to them. It's the same attitude that Congress has.
It reminds me of Jimmy Carter carrying his own empty garment bag.
AMEN
The irony (jealousy?) here is that Nancy Pelosi demanded her own corporate jet, a 767, from the Air Force just last year.
We might have been better off if Jimmy Carter had shined his own shoes,emptied his wastebasket,cleaned the Oval Office, and done anything that left him less time to screw up the nation and the world.
So .. now 4 pilots and a number of machinics are out of a job...
Let the layoffs begin....but not for the UAW
IMO, this is not a class warfare issue. It's about leadership, something which is sorely lacking in Detroit.
When times are tough, management needs to lead by setting the right example. A brand new butterbar knows more about leadership than these Big 3 Auto CEO's...combined.
Perhaps they should read how Harley Davidson got themselves out of their fix two decades ago.
Thats what this whole private plane issue is designed to do.
Congressional leaders delayed the $25 billion (which will ultimately come) and required the Detroit3 CEO's return to Washington in a couple of weeks so that there will be video of these three formerly powerful CEO's arriving back in Washington on commercial aircraft, thus castrating them. Two reasons: 1) Because these Congressional leaders can, and they love it screwing over other people. 2) To teach other industries not to come asking for money, unless they are carrying their testicles in their outstretched hand.
I suggest that the three CEO's, instead of using "commercial air" travel together to D.C. in a Tahoe Two-Mode Hybrid, with the "Captain's Seat" configuration (with a table between them). The Tahoe Hybrid was "Green Car Journal's" "Green Car of the Year" last year. It's about a 9 hour drive. They "could get a lot of business done, and turn a "castrating" experience into a show of D3's green technology.
Companies,like individuals, cannot forever spend more than they make.
GM had 7 corp jets. Now they have 5. Big Whoop
“There is a perception issue,” Wilkinson said of Wagoner’s travel to Washington on a private jet. “We need to be very sensitive to that going forward.”
Or in plain language, he doesn’t see a problem with it, but he’ll play the game (for now) to get what he wants.
My take is this:
I know retired big-3 corp pilots and for the record I have not had the chance to talk to them. However, my guess is their "Key Man Insurance" for these Exec's forbid them from riding on the likes of Northworst. Notice they all took separate planes, Why? Remember when Disney lost a good chunk of their top management team when the Corp helicopter went down? These guys for better are worse are an asset to the organization and shareholders and are protected as such, ergo the separate Jets.
As far as traveling commerical, especially if this was a working flight, that is a no go. Was it Bagala or Dean who got their @$$ handed to them as someone recorded their conversation on a flight and it made it to the New Media?
Now put yourself in the position of these guys responsible for the shareholders, what they talk about may be properitary and with all sorts of audio and digital recording devices at commoditized prices available to anyone, it is to much of a risk IMHO for any Corp Exec to submit themselves to such a recording and the damage control that would have to be developed from speaking freely and saying something the PC police might use to destroy them.
Wal-Mart executives fly coach and share cheap hotel rooms.
Folks need to educate themselves about how business works, what its legitimate expenses are.
Just because an individual can't justify a private jet doesn't mean that a business can't.
I dub them "mini looters".
He was a poor president, but he apparently did set one standard for CEOs.
He carried his own briefcase. A friend was a corporate pilot during this time, and he said his CEO passengers started followed this trend....:^)
But, I bet at this time, none of the big 3 CEOs actually carry their own briefcases...:^)
Agree.
I was insulted by the arrogance of someone asking for taxpayer dollars while clearly not seeking to limit expense. I’m usually quick to blame the UAW for the many of the pains GM has, but this example falls right on Mr. CEO’s shoulders.
It’s the kind of arrogance usually reserved for members of congress!
“Can I get my $25 billion now?”
Actually, there is a kernel of truth in that statement. Most CEO’s travel with a team. So, the math shown on tv, being about $900 for 1st class commercial vs $20,000 for a corporate jet to fly from Detroit>DC>Detroit, is somewhat exaggerated. Also, there are security issues as these are high profile people. Then, perhaps not in the case of these idiots, but there is a time value for these people, assuming that they are competent of course. Buuut, let's not let our self rightous congress of the hook so easily as many of these people fly on government owned versions of corporate jets. And then, how could we forget everyone’s sweetheart, Nancy Pelosi and her personal government owned Boeing 757 which is estimated to cost about $20,000 “per hour” to operate. Now, that's a bit excessive seems to me...
Not buying it. No one man is bigger than the company. They can take separate flights, fly in a day early, I don’t care. Drive. Keep your mouth shut in the cabin. Profitable companies can have all the corporate jets they want. Losers begging for a handout from Uncle Sugar get none. How many non-union types are unemployed because the executive goodies were judged to be more important.
And GM is trading at $2.83 so there is very little in the way of shareholder value being maintained.
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