Dealer, Customers Ponder Future Of GM

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John Medved i

John Medved, owner of Medved Autoplex in Colorado, says he is disappointed that the Obama administration forced out GM CEO Rick Wagoner. Jeff Brady/NPR hide caption

itoggle caption Jeff Brady/NPR
John Medved

John Medved, owner of Medved Autoplex in Colorado, says he is disappointed that the Obama administration forced out GM CEO Rick Wagoner.

Jeff Brady/NPR

John Medved is not happy with the White House move to oust General Motors CEO Rick Wagoner. Medved, the owner of Medved Autoplex in Colorado, says Wagoner was doing a good job reforming the huge company.

Medved says the Obama administration was just trying to send a message. "I guess it wouldn't be any different than shooting the No. 1 hostage and saying, 'We're for real,' " Medved says. "I think that it's a statement to the union and the bondholders that either you make a deal or we will pull it [GM] into bankruptcy."

Medved has a direct stake in what happens to GM — eight of his 18 dealerships sell GM products. He says his Chevrolet dealership in Wheat Ridge, Colo., is the busiest in the state, but that's not saying much these days.

"This store in 2002 was selling 230 Chevrolets a month — now we're selling about 50 a month," he says. Medved has cut more than half of the 600 employees at all his dealerships in the past couple of years. Now he is down to 275 employees.

Medved also suspended the company's 401(k) matching program and restructured the health insurance plan to save money.

John and Joan Rutherford of Golden, Colo., bought one of the two cars Medved Chevrolet sold in Wheat Ridge on Monday — a metallic black 2009 Malibu. They had heard about President Obama's references to possible bankruptcy for GM earlier in the day. Still, they settled on the Malibu after looking at the Ford Fusion and the Honda Accord.

"At the end of the day, I don't think that they're going to allow a company like Chevrolet to fail," says John Rutherford. Obama's pledge that the federal government would back up warranties if GM goes bankrupt reinforced that confidence.

"I trust Obama personally," Joan Rutherford said. "I think he's obviously an intelligent businessman, and I feel comfortable that he's not going to let the wrong things happen."

Another potential customer, who chose not to buy a car Monday, had a very different opinion of the White House forcing out Wagoner.

"It bothers me," says Alan Squire of Golden, Colo. "I think it's the first move to socialism."

"There are a lot of small businesses — they're not getting any bailouts," says Squire, who owns a small business that sells automotive paint. "Why should the big guys be treated any different?" Squire says that even companies as big as GM should be allowed to fail if they can't compete.

Medved Chevrolet sales manager Tim Myers says GM really needs someone like Lee Iacocca, who is credited with turning around Chrysler in the 1980s.

"He said, 'Folks, we're going to be around, we're going to be viable, we make a good product — come buy from us,' " and customers did, Myers says.

Wagoner — while a smart manager — does not have those same qualities, Myers says. "He is not that charismatic individual who can get out in front of the audience and say, 'Guys, let's go!' "

Myers says GM is making great cars right now, but still suffers from the poor reputation the company earned in the 1970s and '80s. If GM can't find a charismatic leader to change customers' minds, Myers wonders if perhaps Obama could accomplish that.

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