Is it really fair to judge an auto company CEO today by his company's share price?
DaimlerChrysler Chairman Jurgen Schrempp is furious with Wall Street for not rewarding DCX's excellent financial results. But investors aren't rewarding any company that doesn't map DNA or sell Palm Pilots or provide free Internet access.
It is a frustrating time. Every time a car company announces a technical partnership with an Internet middleman the partner's share price soars and the auto stock languishes.
Investors don't care about car companies. Even Volkswagen, which traditionally hasn't cared much for investors, is alarmed enough to take action.
But what can auto executives do about it? The usual methods of creating value - share buybacks, roadshows, stock option incentives - don't seem to work.
Auto bosses can't ignore these basics - especially in Europe. But can they prevent their companies from being overrun in the rush to tech stocks?
They can and they must. Automakers have to fight back. They have to unlock the kind of value that today's investors understand. The auto industry represents the 'old economy,' but it is also the world's leading participant in the new economy.
The new e-purchasing exchange formed by General Motors, Ford and DaimlerChrysler will be by far the world's largest Internet business.
'It clearly has a lot of value that isn't reflected in our current share price,' said Henry Wallace, Ford's chief financial officer. 'We have to look at that, whether it means making it an IPO (initial public offering) or whatever. But more than that, it is the whole e-commerce area. The question is, how do you leverage this value?'
The first step with the new trade exchange is to become operational. But the very next step should be to do some financial engineering.
'We know it's going to be a big opportunity to bring value to the Ford Motor Co.,' said Wallace.
Rather than waiting for investors to reward assets and solid performance again, the car industry ought to bring out the value it already has. These are the modern rules. Instead of arguing with them, auto chiefs ought to play by them.
'We've got to get people back into our industry,' said Jurgen Hubbert, head of Mercedes-Benz and Smart at DCX.
He's right. Don't get mad, get even.