It's the holiday season. General Motors is headed for a yearly loss in excess of $4 billion. Wall Street is not happy, and the share price is plunging. The CEO's job is on the line. He convenes crisis board meetings and emerges to announce a long list of factory closures and layoffs in the tens of thousands.
Deja vu? Ride the time machine back to December 1991. GM CEO Robert Stempel is on the hot seat. He takes drastic action, announcing a list of layoffs and plant closures - 80,000 job losses, six assembly plants, four powertrain and 11 component plants - that dwarfs the numbers in Rick Wagoner's new plan.
The history lesson doesn't bode well for Wagoner, a player in the events of that tumultuous time. He was promoted from president of GM do Brazil to CFO in 1992. What followed Stempel's announcement was a bloodbath.
As GM's financial woes mounted, President Lloyd Reuss, Stempel's man, was demoted in April in favor of Jack Smith. By October, GM's board had lost faith in Stempel himself. He resigned, and Smith became president and CEO. Stempel's group was replaced with a new management team.
Fourteen years later, and GM has been forced to take the cure again. It will be interesting to see whether the doctor survives this time.