Road to Power

Chapter 9 Chevy Avalanche: The Road to Ruin

Mary Barra's management at Hamtramck may have helped set the plant on the right path, but it was just one plant of many at the automaker that were facing similar quality problems. In 2004, she was called back to the trenches of manufacturing, again working for Cowger.

General Motors at this time was, in Barra's words, “a cost culture.” Under CEO Rick Wagoner, who had taken on the chairman role as well in 2003, when Jack Smith retired, GM was losing money on almost every car it sold—racking up a total of some $82 billion in annual losses by the time the company filed for bankruptcy protection in 2009.¹ The statistic was even more stunning when you considered that Wagoner, who holds a degree in economics from Duke University as well as an MBA, had risen through the financial side of the company and had served as chief financial officer. If he couldn't make the numbers add up, who could?

To be fair, there was an elephant in the room. The company was carrying huge, crippling costs of providing benefits—including a health care package with virtually no co-pay—to thousands of retirees and their families, agreed on in better times. The burden would eventually help push the company over the brink.

Focusing on numbers alone wouldn't help GM, whose products continued to leave consumers unenthused. “There's got to be arguing between the people who are fighting for product excellence and customer satisfaction on the one hand and the people who ...