USA Cars: The Inevitable Crash

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BOOKS on business leadership often fail to catch readers' attention because they sugarcoat incompetence, the single most intriguing characteristic of many successful careers. This is a pity, because the people at the core of these books are often excellent subjects for study by people other than their miserable underlings.

Bob Lutz's "Icons and Idiots" provides a template for a better approach. Over a long career he worked in senior positions for BMW, Ford, Chrysler and General Motors (twice). This gives him a unique vantage point when trying to explain why the car industry, which benefited from a huge domestic market in America, needed a bail-out: it was run by petty tyrants unworthy to be in charge of a lemonade stand, let alone a vast industry.

Mr Lutz leavens his criticism with brief praise at the end of each appraisal, which can be ignored, or by finding virtue in character flaws, which should not be. Consider the flattery applied to his first boss at GM: "Bob Wachtler was not without a sense of humour, however racist, sexist, homophobic and speciesist it may have been." Wachtler's best feature was his ability to speak clearly: "Many times I would hear him shout," Mr Lutz writes, 'I read your stupid memo, and it's clear to me that you don't get it. I can't waste my time explaining it all again, so just rewrite the f--ing thing, and this time, recommend approval'."

At least Wachtler knew something about cars and cared about producing them. Mr Lutz describes his next boss, a senior official at GM Europe, as follows: "From his lower lip, a smooth curve of ruddy fat arced gracefully down to his shirt collar." His greatest virtue, it becomes clear, is that he was too dysfunctional to undermine the people he was supposed to manage.

Mr Lutz was not so fortunate in subsequent assignments. Harold (Red) Poling, a famous Ford executive, was so thoroughly obsessed with cost controls that he wrecked the market for a well-timed small truck by withholding critical funds to correct flaws in its engine. His rationale: the flaws would become obvious only after the warranty expired, thus sparing the company the cost of making repairs. Philip Caldwell, the first non-Ford to run Ford, was obsessed with senseless detail and acquiring free soap and jam from company hotels. Yes, he cared about quality, but only after reading Mr Lutz's book does that appear to be a novel, rather than inevitable, virtue.

If "Icons and Idiots" suffers from a flaw, it is the difficulty of mocking the foibles of an industry whose failures so damage society. An offsetting virtue, and why even pessimists might be reassured by this book, is that it proves how bad luck was, at most, just a minor difficulty compared with the problems that were wholly self-inflicted.

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