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How Marchionne made the turnaround at Fiat. It takes a crisis to get something done, but you also need a leader who can make things happen. Marchionne turned out to have a direct approach to Fiat's problems, not shirking away from anything he needed to get done. But how he was able to get workers and the younger managers to team up in a new culture of openness and directness to get things done shows that he brought some rare qualities of leadership and persuasion.

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Calls at the BRICS leaders New Delhi summit for a change in quotas for the World Bank and the IMF, and a more open merit based selection process for heads of the two financial institutions. According to the Economist Belgium has a larger quota than Brazil at the IMF.

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Mr. Vanderhei of Politico leaves to form a rival political coverage site called Axios, which has funding from Comcast Universal. The result of a rift between Mr Albritton, the owner, and the CEO, Mr. Vanderhei, is that many executives are now leaving Politico, putting it into a crisis. 

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Marchionne's comments that a new Fiat might merge with Chrysler and move headquarters from Turin to Detroit causes an uproar in Italy.

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Can Fiat get out new models fast enough to survive the current storm in the industry. Experts say the new Fiat based Chrysler vehicles won't come out till 2011 in the USA market. These include asmall Jepp, asubcompact car and aminicar, with amidsize sedan to follow in 2012. This time lag says Michael Robinet of CSM Worldwide is "an eternity" considering the severe fall in sales and the extremely competitive market today. The cutbacks in prouct development under Daimler and then Cerberus were deep, so deep that Chrysler has eliminated 40% of its engineering staff and delayed or cancelled work pn updating braking systems, interiuor enhancements, and even entire products such as the Jeep Wrangler, say insiders. This makes Fiat entirely dependent on Fiat's technology and engineering in the smaller car area.

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Senator Warren says weak leadership at the S.E.C. is the reason for the lack of effective enforcement and lack of prosecution of individuals for financial wrongdoing.

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To promote the green image Chrysler is downplaying the Hemi engine. It will be offered as an option but won't be called Hemi, but simply 5.7 liter V8 for certain jeeps. Chrysler will emphasize smaller engines such as the V6 Pentastar engine and 4 cylinder engines.

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Most American large companies support president Biden's decision to mandate vaccinations for all employers with more than 100 employees. Smaller business also supports the decision as it makes this decision for them. The US Business Roundtable of the largest US companies issued a statement saying it "welcomes the Biden Administration's continued vigilance in the fight against Covid." It went on to applaud the decision of some companies to implement a vaccine mandate before the president's decision. Companies would like to see a rapid ramp up in testing capacity as they see testing capacity levels not the vaccine mandate as the real problem today with the surge in Delta variant. These companies such as Target, Nike, and retailers see testing capacity as "stressed" and say "testing capacity must be scaled immensely to meet the new requirements." Labor unions clearly support president Biden's decision including teachers associations, and the AFL-CIO. Some companies including Delta Airlines are imposed health surcharges for unvaccinated employees, and United Airlines has brought in its own vaccine mandate. The president's vaccine mandate has broad and deep support of the American people and business, according to this WSJ report, with recognition of the huge risks posed by the transmission rates of the Delta variant in the surge of coronavirus in September 2021. However companies say the Biden Administration has to scale up testing capacity quickly to make it work. ...

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What has to give in government oversight and reshaping the debt and costs at General Motors? The auto workers and retirees inspite of all the givebacks still pay only 5% of theirhealthcare costs vs an average of 30% for the rest of Americans with healthcare coverage. With a sharing that reflects the national average GM wouldn't have to shoulder the size of the health care obligations for union workers and retirees of the sum of $47 billion. And the debt holders of GM debt, the bondholders would take a cut of something approaching Senator Corker's proposal to trade debt for equity at a 70% discount. That would reduce the GM debt from $63 billion to less than half that.

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In an historic event, the young Senator who introduced bills on improving fuel efficiency in the Senate only a few years ago, announces his proposal for a single national fuel efficiency standard of 35.5 miles per gallon in 2016. Mr Obama had the chief executives of 10 global auto companies all gathered together, as he made the announcement. It reverses decades of conflict on this issue, and puts the US at the forefront of developing new technologies for fuel efficiency and emissions control.

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GM and Chrysler will face a tough market in the years ahead. The last year as seen GM's image with the American customer erode even further. Reputation Institute surveyed 70,000 people worldwide, and found only Mitsubishi and AvtoVAZ have a worse image. This inspite of improvements in quality at GM, which shows that management errors and its image matters a lot in buyer behaviour. Worse still GM and Chrysler, both are not favored by the younger generation of customers. The new demographics show that 73 million 21-33 year olds will be customers in the next few years, and they have shown little interest in Detroit brands. These people says one expert on atitudes towards automotive brands at AutoStrategem, can't see heir friends in these brands, and so can't see themselves in them. Perception matters a lot to these young people who are better educated. Studies have shown that college graduates and better educated Americans favor overseas brands by a wide margin. Chrysler is pervceived as having poor quality according to JD Powers and Consumer Reports. With $21 billion in debt Chrysler is more burdened with costs, needed improvements are less likely without investment. Chrysler may shrink to 6% of the market says BW, and GM will probably go down from 19% in 2008 to 14% in the next 3-4 years, as competing with Honda, Toyota, Hyundai, VW and new competitors from China and India makes for a very tough environment. Worse still there is about 90 million car production capacity worldwide, and the worldwide market has shrunk to 55 million cars and is still shrinking. ...

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55% of Chrysler cars went to corporate and rental fleets in Septemeber and incentives are higher than ever, both warning signs for Chrysler. New Fiat models are not due for another 2 years.

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Cerberus will lose control of GMAC, and this may be a good thing, as decisions at Cerberus and GMAC while under its control were made not in the interests of GM and its customers but of Cerberus,s efforts to extricate itself from its troubled investments. One of these decisions was the decision in September 2008 to raise the credit scores for prospective GM customers to 700 before approving credit. Johnson of Barclays Capital says that in November 2008 only 1% of GM's customers used GMAC financing from a figure that was normally at 45%. During September, October, and when the credit crisis hit hardest in November 2008, GM continued to suffer hugely declining sales, and the decision to cut GM's customers off from GMAC credit must have only aggravated a bad situation from GM's concentration in SUV's and trucks and the tight credit conditions. With the November situation worsened by customers simply postponing car purchases due to concerns about job security (as about 586,000 jobs were lost in November), the credit scores decision could only hurt GM badly. Now Treasury is stepping in with $5 billion to GMAC with another $1 billion to GM to invest in GMAC. The result will be reducing Cerberus control of GMAC from 51% to 14.9% of voting shares and 33% of total equity. Cerberus will also stop providing consulting services to GMAC and the 2 companies will no longer share executives. And the GMAC Board will be reconstituted reducing the number of members affiliated to GM and Cerberus, and adding agovernment appointed board member. The government's $5 billion stake will pay an 8% dividend and it will put the government ahead of Cerberus's common equity holdings. Originally Cerberus and dozens of co-investors paid $7.4 billion for the 51% stake in GMAC in 2006. Now Cerberus plans to distribute piev=ces of it current GMAC stake directly to coinvestors. Cerberus has other troubled investments. With its flagship $4 billion fund down 15.8% as of November 30, 2008, and the firm has suspended withdrawal requests from investors after suffering big losses in October and November on a bet in fixed income markets....

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The really small cars like the HOnda FIt and the Toyota Yaris and the GM Aveo are piling up on dealer lots as the price of gasoline drops to $2 a gallon from last summer's $4 a gallon. At February end 2009 Honda had 22191 Fits on dealer lots enough to last 125 days at the current sales rate, and Toyota had enough Yaris subcompacts to last 175 days at the current sales rate, according to Autodata Corp. Chrysler has a 205 day supply of the Dodge Caliber, and GM 427 days of Aveo cars. Honda Civics are also piling up. Price shifts and shifts in consumer attention and buying behaviour makes it difficult to plan ahead. The American carmakers have shifted plants to smaller and midsize cars after seeing the disastrous drop in the sales of larger vehicles in the third and fourth quarters of 2008. Now government policy is to mandate fuel efficiency standards, there is talk of agasoline tax, and even the current numbers shows ashift away from the SUV's and larger vehicles of the past. Ford's sales analyst Pipas says that over the 5 months ending February 2009 sales of small cars totaled 718,000. This was down 28% over the same period in 2008, but small cars grew to 18.4% of the total market, up 2.1 points from the year earlier period. Part of this is that overall the market has declined much more than 28%. This also shows that policy in an industry-government partnership will have to show the way that is best for the US, to ensure that oil prices don't go up the way they did, when consumption at the pump was excesssive and fuel standards lax. This should also be done in a partnership with other countries like China and India to ensure that technologies are available worldwide to reduce fuel consumption and promote fuel efficiency, as keeping consumption per passenger for each mile travelled as low as possible will take pressure off the oil price. It would make automobile transportation feasible for a rapidly urbanizing Asia, and by reducing the pressure on price that urbanization and motorization in Asia would bring, help moderate oil prices for western countries. ...

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Toyota's sales in Sepember fall 32% and Hondas sales fall by 24% showing how even the Japanese makers are hurting with sales of Corollas and Camrys down. Nissan's down by 37%. General Motors down by 16% but only because of fleet sales. And Ford down 34%. According to AutoNation CEO Jckson whereas in 2007 90% of auto loans were approved for buyers with top credit ratings now only 60% are getting approved.

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Holman Jenkins makes some good points as the auto companies in Detroit look for government rescue. He suggests dumping CAFE altogether if Congress is serious about conservation, a gas tax would be the only intellectually honest thing to do. In the light of falling gas prices in November 2008 with $1.98 a gallon in Michigan and across the country, how will demand for hybrids and the Chevy Volt at $40,000 fare? Its hard to tell but some serious thinking about energy and automobiles is in order. Congressional mandates have a tendency to have poor consequences as Holman mentions, because of the loopholes in the mandates like the fuel mileage rules that allowed fleet averages, loopholes Detroit automakers used to lead the trucks and SUV boom to coverup hidden problems for so long. Some of these had to do with the UAW's insistence on rules and benefits and things like the Jobs Banks that were obsolete in a age of globalized manufacturing and unequal playing fields with the Japanese and Koreans in mostly unuionized factories in the southern United States. Some of them with lack of effort, vision and innovation by Detroit car companies to make the fuel efficient technologies to reduce costly fuel imports, and the failure to bridge the union management divide that has been there all the time in the postwar period skewing decisions and leading to obsolete behaviours. Holman sees nationalization of the auto companies as the only possibility given the car companies history and failures, with or without bankruptcy. Even then he does not see them becoming competitive without good leadership and right policies in running the companies and honest policy at the government level, and courage to get a firm grip on reality. ...

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President Obama's speech announcing the details of his executive order on immigration on Nov. 20, 2014, starts by saying he is not bypassing Congress or the Republicans. He says Republicans had the opportunity to pass legislation in the House that passed the Senate, or come up with their own bill. And still have an opportunity to come up with a bill he could sign into law that address the shortcomings of the current immigration system. In selling the bill to Americans he points out that this is not an amnesty, that the current system which allows immigrants here to stay illegally without paying taxes or any accountability is an amnesty. He points to deportation of millions as not an option, an out of the character of America. That deportation of criminals will continue and is up 80% in his administration, without mentioning that deportation under his administration for ordinary undocumented immigrants without any criminal record had reached a high of 400,000 a year under his administration, higher than under the Republican Bush administration. In fact it had reached such levels that Hispanic groups stated they would sit out the midterm 2014 elections and not vote for Democrats or Republicans, after providing a significant part of the winning margin for Obama in the 2012 presidential election. President Obama says he has the legal authority to prevent deportation, and that this is essentially what this executive order does- providing a temporary right to stay and work in this country to undocumented immigrants here living in the shadows who are here for more than 5 years, not a permanent status or citizenship. He cites other presidential decisions of the last 50 years, Republican and Democratic, that have integrated large groups of undocumented immigrants, including an executive order by President Reagan. And he refers to the Bush presidencies 41 and 43, where both father and son, considered Hispanic Americans "a part of American life," as good hard-working people deserving a chance to be Americans. The speech ends with an appeal to the compassion of Americans urging them to look at their own individual stories going back one, two or several generations, or Ellis Island where the early waves of European immigrants entered the country in the 19th century, and to immigrants from the period after the early British settlements in the 18th century. This is typical Obama, as much as the calculated decision to pursue a aggressive deportation policy was for the first 6 years of his administration, including the decision for "Dreamers" or young people before the 2012 election. "Scripture tells us, we shall not oppress a stranger, for we know the heart of a stranger. we were strangers once, too. And whether our forbears were strangers who crossed the Atlantic, or the Pacific, or the Rio Grande, we are here because this country welcomed them in." Over 2 million deportations in one of the most aggressive deportation policies of any administration, followed by an effort to stop deportations before the next presidential election, when the NYT had called his deportation policy "infuriating." ...

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Jena McGregor's interview with Ben Horowitz of Silicon Valley. Horowitz says its best to keep the founder as CEO, because its harder to teach a professional CEO to innovate, than it is to teach a founder to be a CEO. Better to take the advice of one football sports team owner to his coach when told about injuries and problems: "Nobody Cares. Just coach your team." Best to focus on the task ahead than to get overburdened by thinking about the hurdles. Many companies make the mistake of overhiring and finding they are in trouble when business falls off. At that time a moment of honesty is essential, even though a trust with the employee has to be broken, one cannot hide or blame the employee- only by saying we screwed up and planned the business the wrong way, can one make an honest effort to recover. Not making the honest assessment and being frank with oneself and colleagues can be fatal for a young company. Andy Grove of Intel, cites this example in his book "Only the Paranoid Survive," - to shift out of the memory chip business and close plants was essential once it was clear the Japanese had an unsurmountable edge, a long term move into microprocessors had to start now for Grove and Intel in 1986. An outsider's impersonal logic and no emotional involvement had to be Grove's mindset, as if he was replacing himself as the new head of the business, going out one door and coming back in. Panasonic's moves in 2013 under CEO Kazuhiro Tsuga to exit the plasma television business and focus on new business opportunities, including electric car batteries, is a recent example. On motivation or purpose: no big vision has to be announced and repeated- it is enough to make being a good company at what you do the end goal, make craftsmanship or doing the work you enjoy and can contribute in the end goal and purpose. The modest and straightforward is enough reason for existence and doing very well. How important is training? A lot, a great deal more than one can imagine. People can be talented but not productive. Companies that have good and extensive training programs can do much better than companies that lack these programs. Managers who can continue this with on the job training are also valuable to build on training programs. Sony's Akio Morita personally interviewed new hires, new engineers joining the company at all levels- it is really the contribution of the thousands of engineers that he personally interviewed that built Sony into a global pioneer in electronics in his time. He says the future of the company is determined by the people the company hires. Goes even further, by saying the fate of the company is in the hands of the youngest recruit on the staff. Horowitz finds Jim Collins as management writer a bit abstract and mushy, he prefers Intel's Andy Grove and his books such as High Output Management, as more specific about how to manage business. One could add "Made In Japan," and Morita to the list....

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Chrysler decides to close the St Louis minivan plant with 2400 jobs lost.