In the wake of Jerry York's speech to the Society of Automotive Analysts, just about everyone is focusing on his punch list of things General Motors must do to save itself.
There isn't anything radical on the list or anything that hasn't already been suggested by Wall Street analysts or other wags. Almost every point is a no-brainer, except maybe for the suggestion to whack Saab.
But the real message York delivered in Detroit on Tuesday, Jan. 10, is that he and his associate, Kirk Kerkorian (one of GM's biggest shareholders), believe GM's glass is half full, not half empty.
Yes, York says GM needs to go into crisis mode, cut its annual dividend in half, cut everybody's wages and make tough decisions about what products and operations to kill and which noncore assets to sell.
The one-time Chrysler CFO also says GM should go public with a three-year financial plan similar to the one Carlos Ghosn used to turbocharge Nissan's recovery. A clear set of performance goals and benchmarks would galvanize employees and let the world monitor the automaker's progress.
It's sound advice.
Yet York isn't negative. He's an old-fashioned guy who believes GM can do what needs to be done and return to prosperity without Chapter 11, just as the old Chrysler Corp. did when he was there.
All GM needs to do is follow his plan.
A growing number of analysts and business consultants disagree. They say the automaker can't get competitive with Toyota unless GM uses Chapter 11 to scrape the UAW contract off its shoe.
There may be a little wishful thinking involved in York's view because in a bankruptcy -- as he noted -- only secured creditors, advisers and lawyers come out whole. Shareholders often lose almost everything when a company reorganizes in Chapter 11.
Still, York said he likes products that GM is developing, including the new full-sized trucks that go on sale this year. York also said the automaker has made a good start reducing costs with plans to close nine assembly plants, which will take out 1 million units of capacity, and the health care deal it made with the UAW.
Perhaps as a carrot, he said Kerkorian is interested in reacquiring the 12 million shares he sold in December for tax purposes and maybe buying an additional 12 million shares. That could help nudge the stock price higher.
Jerry York didn't rant or rave or call anybody names. That's not his style. But he has a plan that makes sense.
You may e-mail Edward Lapham at [email protected]