Here's the GM article I had refered to last night.
Popular GM Executive Expects New Deal From Automaker
Detroit Free Press
August 8, 2002
By William Diem
Aug. 8--TRAVERSE CITY, Mich.--Bob Lutz is counting on staying at General Motors Corp. as long as he wants.
The popular executive, known as GM's product czar, said Wednesday he expects the automaker to offer him an indefinite contract, replacing the 3-year deal he signed when he became vice chairman a year ago.
The 3-year time frame was meant as an"initial period"to protect the company in case the marriage didn't work out, Lutz said, adding,"there are high expectations on my part that it is going to work out."
GM would not confirm plans for Lutz's contract.
"There's no questioning Bob's effectiveness both organizationally and personally, especially in the up-front planning process, and design has been really working well,"said spokesman Tony Cervone."We obviously don't comment on personnel contracts until the appropriate time, such as when we file"with the U.S. Securities and Exchange Commission.
Lutz, who joined GM on Sept. 1, earned nearly $1 million in his first four months on the job.
Lutz spoke at a lunch meeting with journalists after urging the industry to rely on common sense rather than data analysis during a speech at the Management Briefing Seminars in Traverse City.
"I went through my annual review with Rick Wagoner recently,"said Lutz. He said GM's chief executive officer had suggestions for improvements in some areas, but"he pronounced himself on balance satisfied."
Many industry observers say Lutz has made two key contributions since joining GM, after careers at BMW, Chrysler Corp., Ford Motor Co. and battery maker Exide. He has encouraged product developers to be more creative in the way they think, and his outspoken passion for products has helped changed the way the news media view the company.
"The longer I'm there, the more you can assume that products reflect my influence,"said Lutz. He said his influence comes not through telling people what to do,"but getting the team to unleash their creativity in the up-front product creation. I want them to stop thinking about it as a rational process and assuming that customers make a rational analysis of their needs."
He said GM"was well on its way to gaining momentum"before he joined the company, and cars like the Hummer H2 and Cadillac CTS were developed before he arrived. His contribution has been to propose"a different way of looking at things. In the next three or four years, you're going to see a lot of surprising vehicles for GM."
Lutz said GM is reducing warranty costs, but there remains a lot of waste in that area.
He said the company would not follow DaimlerChrysler AG in offering a 7-year/70,000-mile warranty on its powertrains.
"We cannot see it doing any good,"Lutz said."Long warranties have come to be associated with brands where people need reassurance. People expect a vehicle to last seven years."
He said that GM conducted a customer clinic to test the value of long warranties by asking customers how they would react if Toyota Motor Co., a company known for quality, would offer a long warranty.
"The feeling was there must suddenly be something wrong with Toyota's quality if they have to reassure people by putting a long powertrain warranty on,"Lutz said.
The long DaimlerChrysler warranty will add to the company's marketing costs, Lutz suggested. He said GM is benefiting more from customer-incentive spending than rivals DaimlerChrysler and Ford.
He said that could be partly because GM was the first automaker after the Sept. 11 terrorist attacks to offer zero-percent financing. Another reason, he said, is that"there is no longer the continuing drumbeat of `dumb old GM' in the media."
"Today, GM has become a semi-respectable place to buy a car,"he said."The stigma has been reduced, and it will continue to diminish as we roll out more hit products."