Why GM Matters: Inside the Race to Transform an American Icon

by William J. Holstein

In November, GM CEO Rick Wagoner appeared before Congress to ask for $25 billion to bail out the struggling Big Three automakers. To critics like Thomas Freidman and Mitt Romney, it was a sign that the American auto industry should be led out to pasture; if the Japanese are better at making cars, they said, then we should let them do it. To defenders, the loss of the country's largest manufacturing sector would be an incomprehensible disaster. Nearly every day, the debate rages on the op-ed pages. Billions of dollars and millions of jobs hang in the balance. In Why GM Matters, William Holstein goes deep inside GM to show what's really happening at the country's most iconic corporation. Where critics say that GM has sat on its hands while the market changed, Holstein demonstrates that GM has already radically retooled its entire operation, from manufacturing and cost structure to design. Where pundits say we'd be better off without GM, he shows how inextricably linked GM and the nation's economy still The country's largest private buyer of IT, the world's largest buyer of steel, the holder of pensions for 780,000 Americans, GM accounts for a full 1 percent of our country's GDP. A dollar spent on GM has profoundly different consequences from a dollar spent on Toyota. Following a diverse cast of characters―from Rick Wagoner, the controversial CEO, to design director Bob Boniface, to Linda Flowers, a team leader on the line in Kansas City―Holstein examines the state of GM's health and builds a persuasive argument that GM is essential to our nation's well-being and, with the right economic climate, ready to compete with Toyota as one of the biggest global automakers.

Genres: Business, Nonfiction

288 pages, Hardcover

First published February 3, 2009

Reviews

[Christine Zibas · Rating 5 out of 5]

Why GM Matters: Inside the Race to Transform an American Icon
William J. Holstein
Walker & Company
ISBN: 978-0-8027-1718-4


Can GM survive? More importantly, should it? These are the questions being posed by journalists almost daily, whether covering Capitol Hill or reporting on Wall Street losses by the Big Three. It’s a story that hasn’t fully played out, and also one that has gotten little background coverage…until now. In his brilliant new book, William Holstein lays out the case for GM:

“The country’s largest private buyer of information technology, the world’s largest buyer of steel, the holder of pensions for hundreds of thousands of Americans, GM (along with its suppliers) accounts for a full 1 percent of our country’s gross domestic product.”

Holstein does an outstanding job of looking at not only where GM came from, but where it’s trying to go. Not everything in the book is flattering either. Yet there are important issues that the author raises that take its value as a book about a major US auto maker and makes it one about a referendum on the US economy generally.

“The fact that 70 percent of the US economy was based on consumer spending and much of that spending was based on borrowed money from abroad was almost certainly not realistic for sustaining the economy.”

He also takes to task those who say that the United States’ future is not in manufacturing, but the service sector:

“Now that the economic crisis has struck, many of the jobs created in finance, whether in mortgage finance, investment banking, or hedge funds, were built on the concept of leverage. They were not involved in creating genuine wealth.”

Some of the most interesting discussion in “Why GM Matters” can be found in the chapter on China and the battle by GM and Toyota for the next generation of car buyers, the Chinese. Issues of globalization become increasingly important to large manufacturing corporations, as Americans and Europeans hunker down in these trying economic times, seeking to hold on to their cars far longer than in years past.

Does Holstein make his case? That’s for readers to decide. The opposing view (presented by Holstein in his book through the voice of GM critic Jerry Flint) can be just as convincing. No matter which side readers come down on, “Why GM Matters” adds thoughtful information to the conversation.

[Angela · Rating 5 out of 5]

In usual cases, a book like this would probably bore me. However, having grown up in Michigan, with a father that worked for auto suppliers his whole life, I found this book to be interesting, from the history about GM, to the evolution of the new Camaro and the Chevy Volt, to where does GM go from here?

My feeling is if the media reported the things that GM was doing right, instead of focusing on everything that was wrong, then maybe people would have a little more sympathy for the company. And maybe it's not even a matter of sympathy for the company, but at least realizing how many businesses would start to have trouble if GM went bankrupt. GM is the #1 private company to purchase IT items...what happens to the IT industry if GM goes under? What happens to the cafes, barber shops, stores, and other businesses around GM plants if they disappear?

GM did things their way for a long time, because the market didn't force them to change. At this point, they are being forced to change by outside companies, consumers, and a global marketplace. However, with a culture like theirs, it's not easy to change opinions within the company, and it has taken some time. But, it's happening.

Anyone who wants more of an understanding about the company, and what they are doing to move into the future, should read this book.

[Joe A · Rating 5 out of 5]

Why GM Matters is a very interesting book written by William Holstein about the struggles of General Motors in today’s economy and GM’s plan to survive in the future automobile market. Holstein captures the reader’s attention with interesting factual information of GM’s past and how it has evolved into the crisis that has unfolded over the past years. The book explains the importance of General Motors in America’s economy and educates the reader about the unknown events throughout the history of the company. The book explores the unseen work of GM employees all over the world, both the good they have done, and the recent bad that has potentially doomed GM. It is interesting to learn how vast and important an operation GM runs and how important GM's survival is to America’s economy. At a time when America’s economy is in a downturn, Holstein offers a knowledgeable perspective of GM effort to transform their operation into one that can compete in a larger global market. This book is not for everyone, but it is a must read for those who care about the future of the American auto industry.

[Andrea · Rating 2 out of 5]

This is like a GM brochure with a little criticism thrown in to make it seem balanced...there is no sense of history, either in GM's atrocious safety records and their massive lobbying efforts against safety and environmental regs, or in the decades of union struggles to actually ensure that GM workers were middle class, the struggles to ensure GM actually hired African-Americans and women and...much more. Like the double-digit profits regularly yielded over decades and somehow disappeared. And I hate the logical sloppiness of saying how GM matters because of what it provides to American workers, even though its strategy is to take away their benefits and lay off as many as possible (which it hasn't been tough enough on doing according to the author). There is the amazing admission by ex-CEO Wagoner that to save GM they've had to destroy the middle class. A nugget left unresponded to. And there are a few more ideas thrown out there, like the importance of keeping some industrial and technological capacity, particularly considering our war efforts...that makes some sense even if I disagree...And there is no bibliography or documentation or notes of any kind. A bit shocking really.

[Ian Gibson · Rating 3 out of 5]

The book has some great information but is extremely repetitive and not written very well.

[Christine Zibas · Rating 5 out of 5]

Can GM survive? More importantly, should it? These are the questions being posed by journalists almost daily, whether covering Capitol Hill or reporting on Wall Street losses by the Big Three. It's a story that hasn't fully played out, and also one that has gotten little background coverage...until now. In his brilliant book, William Holstein lays out the case for GM:

"The country's largest private buyer of information technology, the world's largest buyer of steel, the holder of pensions for hundreds of thousands of Americans, GM (along with its suppliers) accounts for a full 1 percent of our country's gross domestic product."

Holstein does an outstanding job of looking at not only where GM came from, but where it's trying to go. Not everything in the book is flattering either. Yet there are important issues that the author raises that take its value as a book about a major US auto maker and makes it one about a referendum on the US economy generally.

"The fact that 70 percent of the US economy was based on consumer spending and much of that spending was based on borrowed money from abroad was almost certainly not realistic for sustaining the economy."

He also takes to task those who say that the United States' future is not in manufacturing, but the service sector:

"Now that the economic crisis has struck, many of the jobs created in finance, whether in mortgage finance, investment banking, or hedge funds, were built on the concept of leverage. They were not involved in creating genuine wealth."

Some of the most interesting discussion in Why GM Matters can be found in the chapter on China and the battle by GM and Toyota for the next generation of car buyers, the Chinese. Issues of globalization become increasingly important to large manufacturing corporations, as Americans and Europeans hunker down in these trying economic times, seeking to hold on to their cars far longer than in years past.

Does Holstein make his case? That's for readers to decide. The opposing view (presented by Holstein in his book through the voice of GM critic Jerry Flint) can be just as convincing. No matter which side readers come down on, Why GM Matters adds thoughtful information to the conversation.

[Scott · Rating 4 out of 5]

I liked this book for Bill Holstein's ability to tell the tale of GM (and other major global auto manufacturers) in an easy-to-read, enjoyable style. Although my first new car was a 1991 Saturn, since then all of my other purchases have been Toyota and Honda. I had written off GM, Ford and Chrysler as irrelevant and inferior - thus the book's title grabbed my attention.

Mr. Holstein lays out the history and culture of GM in a clear and concise summary of "What Went Wrong". All the chapters afterward explore topics relevant to (beginning to) understand the many facets of such a large corporation as GM. The book reads like an in-depth magazine article. In summary - despite what the average American may know, Mr. Holstein contends that GM HAS been changing - dramatically - for the past five to ten years - and that the positive benefits of these changes were just about to become evident before the global recession hit.

The book was published in February 2009, before GM declared bankruptcy, and before some other major changes have occurred (pending sale of Saab, Opel, Saturn - Rick Wagoner's departure, etc). Even so, the book sent me to the web to check out GM's new vehicles, read reviews, and honestly consider GM for the first time in almost twenty years.

If I came away from the book understanding one thing - it is that there is a real importance for America to build tangible wealth - a wealth that is not created on paper (financial industry), but in our capacity to design and build products such as autos (or planes, trains, ships, appliances, etc). Curiously - a similar conclusion can be reached after reading "Why Your World is About to Get Smaller - Oil and the End of Globalization" by Jeff Rubin. Both of these books, from two very different authors - have me worrying about the future of America's economic prosperity for the first time in my 40 years.

[E · Rating 4 out of 5]

Everything reported in this book is just right – you only need to adapt to its time frame: The book ends with the 2008 national recession. It explains how General Motors hit a financial crisis in 2005, and how former CEO Rick Wagoner and his team tried to fix things before the federal bailout. Business journalist William J. Holstein’s cast of characters includes not only Wagoner and fabled former CEO Bob Lutz, but also a whole constellation of designers, engineers and marketing specialists in Asia, Europe, Australia and Detroit. Holstein tells GM’s story complete with behind-the-scenes sagas about the Camaro, the Volt, OnStar and the rise of Buick in China. All this is intriguing information, and the author’s insights remain valid even though the book ends with Wagoner testifying twice before Congress in 2008 before his ouster by the feds. Holstein fills you in on the situation before Wagoner’s departure, the government takeover of GM and Toyota’s recall crisis. If the events leading up to GM’s fall and rebirth still intrigue you, getAbstract believes this book delivers fresh reporting about the auto giant and its biggest drama.

[Jocelyn · Rating 3 out of 5]

I thought this book would be mostly cheerleading for GM. I was pleasantly surprised - the book focuses on leadership and the mentalities of the company from the last 40 years. The book is critical but also includes stories from people working/worked for GM, giving emotional viewpoints of the company.

[Niranjan · Rating 3 out of 5]

This is great book and must read for all those who believe why manufacturing sector is important to any economy.

[Mike · Rating 3 out of 5]

Interesting chapters on the design of the Camaro and Volt.

[Kevin · Rating 5 out of 5]

Great book, very informative.