If you love the car business — and have the stomach for painful truth — put on your reading list the new book by Steven Rattner, former chief of the Obama auto task force.
Overhaul: An Insider's Account of the Obama Administration's Emergency Rescue of the Auto Industry is a tough history lesson wrapped in fast, kiss-and-tell prose.
Among the highlights, Rattner, a skilled journalist and private-equity success, takes us deep inside General Motors' long-dysfunctional culture.
He falters, though, when he gives the GM board of directors a pass on CEO churn at the company and takes as a given that GM and Chrysler dealers needed whacking.
But first the GM culture.
There's former CEO Rick Wagoner in full denial that GM can contemplate bankruptcy. When Rattner personally fires him, Wagoner asks at the end of the conversation, "are you going to fire [UAW chief] Ron Gettelfinger, too?"
The portrayal of Fiat and now Chrysler CEO Sergio Marchionne is also rich. Involved in pressure-packed negotiations at one point to control Chrysler, Marchionne blows up so badly on an underling that task force folks quietly slip out of the meeting.
Ultimately, though, Marchionne's skill and drive make him the best, last option to save a crippled Chrysler that half the task force would rather see liquidated.
On the government side, President Obama's colorful chief of staff Rahm Emanuel — angered by a big, unpopular federal bailout needed to float GM and Chrysler out of crisis — asks "why even save GM?" He then turns his ire on staunch administration ally, the UAW, reportedly blurting "F**k the UAW."
The union has defended Emanuel as instrumental in saving the automakers and thousands of union jobs.
Rattner is at his best describing GM's pre-bankruptcy finance department. A finance guy himself, Rattner is flabbergasted by lax accounting and a system so broken that managers can't even tell the task force within $500 million how much cash is available.
And, boy, does Rattner name names. He makes clear who he thinks failed and how. Maybe to a fault. For example, Rattner doesn't need to name a product planner who embarrassingly brags that a future vehicle is "credible" when consumers obviously want compelling. That level of journalistic accountability is better reserved for senior managers.
The book's other shortcomings revolve mainly around what isn't said rather than what is.
Rattner, for example, portrays dealer cuts as an obvious necessity. He lambastes lawmakers like House Majority Steny Hoyer (D-Maryland) for pushing dealer arbitration legislation when the country has so many more important issues, like a 10 percent unemployment rate.
Nowhere, though, does Rattner, an avowed numbers guy, quantify how much GM and Chrysler would save by cutting dealers. Dealers argue that they make money for the automakers, not cost them.
In an interview with Automotive News last week, Rattner again was asked to show his empirical evidence. He instead answered with anecdotes about Toyota and Honda having far fewer dealers than GM and Chrysler.
My other major gripe is that Rattner fails to hold the new GM board of directors to the same standards of intellectual rigor that he would hold the other departments of GM.
For instance, GM now has its fourth CEO in 18 months without benefit of a comprehensive national search. Rattner said that government-imposed, executive-pay limitations have largely restricted the board's ability to go outside the current board and management for candidates.
Granted, the board brought aboard a headhunter after Fritz Henderson was fired. But the board quickly promoted Rattner's hand-picked chairman, Ed Whitacre, to the CEO post. And when Whitacre surprised the board by stepping aside on Sept. 1, board member Dan Akerson was anointed without a search.
Akerson is arguably a perfectly fine executive for the job. But how does the board know that there isn't another Alan Mulally outside the auto industry waiting in the wings?
All in all, Rattner's book is a fascinating journey into the auto industry. It delivers plenty of drama, even when the bailout debate involves only Washington insiders.
Just don't expect to feel all warm and fuzzy afterward.
Overhaul, published by Houghton Mifflin Harcourt, is available Sept. 20, in stores and online.