The Pulitzer versus the Pontiac

by emptywheel

Car writers don't get Pulitzer Prizes. I suspect that's because their writing is either wonky and burdened with specs or basically car pornography. Or rather, car writers used to not get Pulitzers, before Dan Neil got one last year, "for his one-of-a-kind reviews of automobiles, blending technical expertise with offbeat humor and astute cultural observations." I guess they liked Neil's honest, irreverent writing in passages like this:

If you ever despair that the U.S. auto industry is whirling, slowly but with gathering momentum, down the tubes of history, the second-generation Toyota Prius will give you no comfort. This is a car Detroit assures us cannot be built. No way. No how. A spacious, safe and well-appointed mid-size four-door with practical performance while returning more than 60 miles per gallon? For $20,000? Are you, like, high?

Well, there it sits in my driveway, looking like a set piece from a Kubrick film but in other respects a straightforward piece of engineering. And it shames the domestic automakers and the Bush administration.

Well, guess what? Neil's right about the Prius and the domestic car makers. But the car makers don't like to see such things in print, certainly not in one of this country's largest newspapers. Which became a problem when the LA Times published this slam on the Pontiac G6 the other day:

The G6 is not an awful car. It's entirely adequate. But plainly, adequate is not nearly enough. 

[snip]

Meanwhile, the detailing of the bodywork makes the skin of the car look eggshell-thin. I wonder how many buyers look at this car and wonder what is behind the billboard?

Interior styling: The GT comes with comfortable leather-lined bucket seats, nicely bolstered with heaters. I like the soft grip on the hand brake. That exhausts my praise for the interior.

I guess this is what they mean by faint praise? The real problem with the article, however, is that it spent most of the article describing GM's serious management woes:

In [Bob Lutz'] 3 1/2 -year tenure, GM has lost something like 3 percentage points of market share. I was about to make the case that, given GM's current China syndrome — North American market share dropping to its lowest point in decades, and market analysts, sensing no real momentum for reform within the company, downgrading the company's bond ratings to near-junk status — someone's head ought to roll, and the most likely candidate would be the numinous white noggin of Lutz.

So guess what? Just after the column ran, GM pulled its advertising from the LA Times, purportedly because of complaints from its dealers about "factual errors and misrepresentations" (although the dealers themselves don't appear to be withdrawing their advertising).

Apparently, Neil has gotten in trouble for his, um, frankness in columns before. At least according to  this account, Neil got canned from a previous job in North Carolina for admitting in a column he'd had sex in the back seat of a Ford Expedition (or perhaps the Excursion, which is actually the largest Ford SUV and ought to be big enough for the missionary position). Now, I've had to write about those large Ford SUVs (in language that was required to be wonky and full of specs), and I've got to say, if you can liven those cars up, more power to you!

But this face off is different. It pits the ailing Tribune news company against the even-more ailing GM. It pits the signature of journalistic credibility, the Pulitzer, against a management style that is increasingly losing its credibility—without losing its insistence on management authority.

GM's woes have been well-publicized. GM continues to lose market share to the Japanese here in the states. And the same thing is happening in the market where it actually made a profit last year, China (GM could make $2500 on a Buick Regal in China, as compared to the $200 it makes on them here—but increased competition has ended that gravy train). Given rising gas prices and new Japanese entries in the hulking SUV and truck market, GM hasn't been able to get rid of some of its supposed money makers, things like the Yukon and the Envoy. And just in the past few weeks, all the debt rating agencies have declared GM almost junk, with the title of junk almost certain to follow in the next year.

But the Tribune is in its own little world of less-publicized hurt. From the WSJ article linked above:

The Los Angeles Times's financial performance has been weak ever since Tribune acquired it five years ago as part of its merger with Times Mirror Co. Last month, the publisher of the Times, John Puerner, announced he would step down in May to take a "self-imposed career break."

The economy's swoon has hammered the Times, the fourth-largest daily paper in the U.S. which accounts for about 27% of Tribune's publishing revenue. Circulation fell as Mr. Puerner slashed unprofitable circulation in remote desert towns and bumped the daily newsstand price back up to 50 cents from the quarter his price-cutting predecessor charged. Today, daily circulation stands at slightly more than 902,000 copies -- about where it was in 1968.

Advertising, too, has fallen, with one measure down 14% since the year before the merger. The Times has blamed a decline in Hollywood movie ads, the war in Iraq, Sept. 11, and a grocery-store strike.

The AP article covering this spat says the LA Times will "review" its coverage of GM, suggesting it might cave to GM's pressure. Perhaps for real business reasons. The first estimates put LA Times' potential loss at $10 million. Editor and Publisher, however, estimated the losses could be twice that. So we may have the specter of a Pulitzer Prize winner silenced to save his employer $20 million in advertising. Which raises the question, what is the cost of one Pulitzer Prize winner—and your journalistic credibility?

But the thing that interests me most about this spat (and the reason I think it's interesting to bring up on a mostly-political blog) is the underlying fight about management styles. In addition to his comments about the G6, Neil said a lot of things many GM observers have been saying—out of print—for a while. But he's also landing the responsibility with management. Rather than canning just Bob Lutz, the product guru who was moved into a strictly product role earlier this week, Neil went for GM CEO Rick Wagoner's head, precisely because of his unwillingness to brook criticism. Neil describes an incident where Lutz called for some necessary changes at GM—but then recanted after a rebuke from Wagoner:

However, given recent events, I have to revise my story. To wit: Dump Wagoner.

It was Lutz, after all, who candidly averred at a Morgan Stanley meeting last month that GM might have to phase out some of its product lines, even using the word "damaged" to describe Pontiac and Buick. In the ensuing furor, Lutz claimed his remarks were taken out of context and over-hyped by the sensationalist media, like that scandal rag Automotive News.

Wagoner memo to Lutz: Stop making sense.

GM is a morass of a business case, but one thing seems clear enough, and Lutz's mistake was to state the obvious and then recant:

If this column was the straw that broke the camel's back, then it was probably the direct criticisms of Wagoner rather than anything Neil said about the G6. Presumably by pulling its advertising, Wagoner is trying to force the Times to do precisely what he forced Lutz to do—back off of public criticisms it made. Public criticisms that, most neutral observers would agree, are right on the money.

I can't help but repeat what everyone else has repeated since GM stocks tanked a few weeks ago: "As goes GM so goes the market" or "so goes America." Whatever is going down with GM is going down for some of the same reasons—poor management structure and a fundamental unwillingness to listen to honest criticism. And the underlying conditions for these reasons are the same everywhere. Newspapers have gotten so reliant and focused on profits they've reined in their critical function. Leaders—of corporations and of the country itself—are more interested in appearing good, even if the underlying reality is far different, than addressing any of the real problems affecting their organizations. And a desire, on the part of those leaders, of operating as if the world still operates like it did in the 1970s or 1980s.

It'll be interesting to see how the LA Times, which has made strives to improve its content of late, responds to GM's move. I frankly think they're in a position to call GM's bluff—the readership they offer advertisers is just not easy (or cheap, given LA TV rates) to reach otherwise. But it'll certainly provide an instructive drama to watch.

Comments

[DemFromCT]

Fascinatin' tale. And it resonates for anyone who's ever worked in the corporate world of "My way or the highway' groupthink.

Got a problem? Hire a consultant. Didn't solve the problem? Fire the consultant. BUT DON'T CRITICIZE THE CEO. After all, it's the same strong but wrong ethos that got us into Iraq.

[Blue the Wild Dog]

I've got 3700 miles on my 2004 Prius. Neil's description of it is dead on. But I wonder if it isn't other Japanese automakers that are at least as threatened by Toyota as Detroit.

[emptywheel]

Blue,

I work in the auto industry (driving my 1991 Honda, which still makes better gas mileage than Ford's hybrid, increasingly regularly down to Dearborn). And I gotta say, the auto industry everywhere seems to be pretty fearful of Toyota. I think Hyundai will surprise people in a few years. But yeah, Toyota scares people. And with its scion division...

Good thing the husband's new autosupplier project is for Toyota, good thing he kept his Japanese relatively fresh...

[Crab Nebula]

empty, no kidding you work in the industry? any hints as to what you do?

I sat in a G6; I think the interior is pretty nice. All the 'buff books' say the car is adequate, though, and the magazines, not newspapers, are the traditional places for smart consumers to research vehicles. Ten years ago you had much less auto coverage in papers; nearly all of it sucks. You can do much better on the web, and certainly in the mags.

One problem with Toyota - their styling sucks. Of course their quality is industry-leading, but writers do not bash the company for how dull their cars look. I mean, the G6 is better looking, IMO, (and I'd bet a focus group would agree) than half of Toyota's car lineup. So there is pro-Toyota bias (mechanically and on build quality, they deserve it, though).

Dan Neil is a great writer, but from what I know he's off base in targeting Lutz. Lutz does not have unilateral power in GM, and his ability to rein in certain 'problem vehicles' is not unlimited. I think Lutz is a car guy, and needs more power, not less.

[emptywheel]

Crab:

I'm not technical at all. Just a lowly consultant, one of the army now employed by the big three.

I agree about Toyota styling (at least their standards). Mr. emptywheel and I bought a non-Japanese car for our last car because we were bored with the bigger japanese cars. But I do think their cars targeted to younger people (scion, Matrix) are pretty good.

Do read the full Neil article. He is saying that the natural tendancy (can Lutz, which I've heard from people who work with GM here) should be expanded to include Wagoner.

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