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GM hopes this time’s a charm with Lutz

Image: Bob Lutz
General Motors Corp. product development guru Bob Lutz, center, during a news conference in Detroit after the company announced Lutz will stay with GM as an adviser.Carlos Osorio / AP
/ Source: contributor

Few folks have as much experience at retiring as Bob Lutz, who seems to be making a career of it.

Earlier this year, the 77-year-old automotive veteran announced he would step down from his job as vice chairman of General Motors Corp. On July 10, he nixed that plan and agreed to stay on and help polish the image of key GM brands.

He’d surprised the industry by joining the automaker, in 2001, after a previous, brief jaunt as chief executive of the battery maker, Exide. Before that, Lutz had been second-in-command at Chrysler Corp., retiring shortly after that maker’s 1998 takeover by Germany’s then-Daimler-Benz. And, of course, he’d also hung up his flight suit, some years before, after a career as a Marine pilot.

But considering his father, a Swiss banker, worked until 94, just months before his death, it’s probably no surprise that Lutz, with his shock of silver hair and ramrod posture, is back at it once again, taking on another key position as the “new” General Motors sets out to prove it can survive after a six-week race through the federal bankruptcy process.

“I can think of nobody better suited to the job,” said GM’s new Chairman, the former AT&T chief executive, Edward Whitacre, Jr.

GM’s CEO, Fritz Henderson, put it another way, as he met with the media, last Friday, to discuss the automaker’s planned comeback. “He’s changed his mind about retiring and we’re glad to have him back,” declared Henderson, quickly adding that, “It’s the best way I know of preventing Bob from recycling through another set of (automakers).”

Over a nearly 50-year career, Lutz has worked for quite a few, including BMW, Ford, Chrysler, and GM. He is the classic “car guy,” in industry parlance, with a deep love and understanding of product, something that’s become rarer each year in an automotive world increasingly dominated by the so-called bean counters.

Swiss-born Lutz was recruited directly, in mid-2001, by one of those finance types, former GM Chairman Rick Wagoner. Lutz had come to realize that there was a distinct need for someone who could turn around the automaker’s moribund product development system, which was, by the beginning of the new millennium, turning out abortive designs like the unloved Pontiac Aztek.

Lutz wasted little time ordering a sweeping reorganization designed to speed up the so-called “PD process,” and also slash costs, which typically ran to as much as a billion dollars to bring a mainstream model to market. Significantly, the executive moved to consolidate GM’s vast worldwide design and engineering resources, rather than continue having each operate as an individual fiefdom.

It was a logical move, according to analysts, echoing the approach of truly global automakers like Toyota and BMW. And it began to yield results almost immediately. GM’s German and U.S. product development centers collaborated on such well-received vehicles as the Chevrolet Malibu, voted 2008 North American Car of the Year by a panel of 50 U.S. and Canadian journalists.

In an interview shortly after joining GM, Lutz cautioned that he could not do everything alone the automaker needed. “I’m the catalyst, not the creator,” he suggested, adding that for GM to succeed, it needed a world-class product development process, not a product czar. The test will come in the months and years ahead, with GM veteran Tom Stephens now running product development.

Lutz, in his second go-round at GM, will become something of the corporate face, taking on marketing and other public activities, tasks that Lutz himself points out are really more in line with his skill set. The ever-energetic Lutz — who still flies to work in his own private helicopter, weather permitting — was trained as a marketer, not an engineer.

“All these years, I’ve been practicing medicine without a license,” he joked after Friday’s news conference.

Few expect Lutz to completely abandon his involvement with GM’s product development operations. And there’s little doubt he’ll be leaving a strong legacy behind. One of his last publicized moves was to create a department, largely staffed by former journalists from the automotive enthusiast press, who are paid to be irreverent contrarians, flagging weaknesses in upcoming designs and pointing out where the competition has an advantage.

In some ways, Lutz may have even more authority than before, as the newly reborn GM has eliminated a number of management layers, creating a streamlined strategy board, upon which Lutz will sit.

Lutz admits he makes mistakes, and he’s fallen on his own sword more than a few times. He was nearly fired from Chrysler when he helped scuttle a proposed merger with Fiat, nearly 20 years ago, that was favored by then-Chairman Lee Iacocca. Months later, when Lutz was asked if Chrysler needed to find an alternative partner, he sent investors into shock when he suggested, “You can’t find a bridegroom when the bride is on her deathbed.”

But perhaps — and, to a degree, because of that irreverence — Lutz has been able to provide a level of independent thinking that many manufacturers have prized enough to keep bringing him back out of retirement.