MICHELE NORRIS, host:
From NPR News, this is All Things Considered. I'm Michele Norris.
MELISSA BLOCK, host:
And I'm Melissa Block. It gives new meaning to the phrase "Washington or bust." After their much publicized road trip from Detroit, heads of the major automakers testified on Capitol Hill today. They're making a second attempt to persuade a skeptical Congress to provide them with a financial bailout.
NORRIS: We're joined now by one of the CEOs who was trying to convince Congress that U.S. automakers need a bailout. Rick Wagoner is the chairman and CEO of General Motors. He joins me now. Welcome back to the program, Mr. Wagoner.
Mr. RICK WAGONER (Chairman and CEO, General Motors): Nice to talk to you.
NORRIS: There was a clear theme that you heard from the auto executives today. Several times we heard that mistakes were made, but you, in particular, stood out because you've been at General Motors a very long time, much longer than the CEOs of Ford and Chrysler. So I'm curious about what mistakes you have personally made that might have contributed to the problems at GM.
Mr. WAGONER: Well, I think things the that I was - that are big ones that we would - that I would be thinking about was, you know, going back to, due to tight financial times, not being able to continue things like the EV1, which while we use some of that technology even today, it would have been great to be able to continue that. We obviously...
NORRIS: And for listeners who aren't familiar with the EV1, could you explain what that is?
Mr. WAGONER: Oh, sorry that's - yeah, it's the electric vehicle that GM did back in the late '90s. It wasn't a financial success, but did set a lot of the thinking, intellectual thinking, that we are using now to bring the Volt to market. I think it's fair to say that the spike up and down in oil prices really got us focused that we needed to just stay on fuel economy as a day-to-day thing. It's just a critical requirement. And even if oil prices are lower, we just have to stay on it as a long-term objective.
NORRIS: You faced a good deal of skepticism in that hearing room today. If you don't get the bailout, are you willing to consider what's being called a prepackaged bankruptcy in which you downsize now, start to negotiate with your creditors, then file for Chapter 11 so the company could rebound more quickly on the other side?
Mr. WAGONER: Yeah. Everything we've looked at in that regard suggests it is a highly complex matter. And I think a lot of the people that are proposing that really are assuming away the fact that there are so many constituents that have to be negotiated with. It's just there's...
NORRIS: It sounds like you're dismissing us.
Mr. WAGONER: I - look, we can't dismiss any options. But it's my view that, that is a highly risky strategy, and so we - highly risky from the standpoint of the company, the industry, and the economy. So we really hope that the process we're going through now will result in confidence enough to provide some funding support that would enable us to do a lot of the good things as far as restructuring the business that we've indicated in our plan that we would do, without the massive risk to the economy, to the auto sector, and to the company itself that a bankruptcy filing would, in our view, bring.
NORRIS: I'm just curious about the health of the company right now. UAW Union President Ron Gettelfinger said today, I believe we could lose General Motors by the end of this month. So, stepping away from the prepackaged bankruptcy, how real is the possibility of an actual bankruptcy for GM?
Mr. WAGONER: Well, I think what Ron was referring to was in our filing we said that we would, based on everything we see today, we would be seeking advancement of funds of up to four billion by the end of this month. And so the question was what happens if that doesn't occur? And so I think that's what Ron was referring to.
NORRIS: Now you've agreed to a big cut in your compensation. You said that you're going to accept a salary of $1. I'm curious, is a $1 salary really a $1 salary? You're talking no bonuses, no stock options, no delayed compensation or anything like that.
Mr. WAGONER: That's correct. We've said that we would pay no cash bonuses out of 2008, 2009 earnings. And you know, I said I would work for a dollar. So that's what it is. Hopefully, eventually, over time, assuming the company meets its turnaround objectives, I'll have a chance to get some additional compensation. But right now, frankly, our focus is working on what we've got to do, and there's no other deals. We're just, you know, that - what we announced is what we've done.
NORRIS: Sir, it seems like you could have bought a lot of goodwill if you had announced this before you came to Washington for your last meeting.
Mr. WAGONER: Well, to be perfectly honest, we've had a pretty - I think it's fair to say, GM, a pretty conservative compensation program. Most of our - of my compensation, over 90 percent, is related to our return in the stock market and bonuses, performance-based bonuses. And those payouts have been quite low. So relative to peers, our payouts have been pretty low. But obviously you're right with the benefit of hindsight.
NORRIS: That was GM Chairman and CEO Rick Wagoner. He was talking to us shortly after today's Senate hearing on the financial plight of the U.S. auto industry.