Keith Naughton

Stories by Keith Naughton

  • Detroit: It's All on The Line

    United Auto Workers president Ron Gettelfinger doesn't look like your typical union boss. Soft-spoken with a neatly trimmed mustache, he's more like a college professor. Yet when asked to describe his style shortly before he became the union's president in 2002, Gettelfinger barked: "Abrasive." He proved it by calling a strike in his first week on the job. The walkout at a car-seat maker caused a domino effect that shut down five GM and Chrysler factories. Gettelfinger then prodded the auto-makers to pressure the seat supplier to settle with the union. Faced with losing thousands of SUV and minivan sales, GM and Chrysler went along with Gettelfinger. The strike lasted just two days.Now the threat of an even bigger strike looms in Detroit--one that analysts warn could drive GM into bankruptcy. And in the driver's seat once again is Gettelfinger, 61, who is to be re-elected this week at the UAW's convention in Las Vegas. Last month the union voted to strike bankrupt car-parts maker...
  • Griping About Gas Prices ... in a New SUV

    With all the histrionics about rising gas prices coming out of Washington these days, SUVs must be an endangered species in our nation's capital, right? Well, not exactly. At Capitol Cadillac, just inside the Beltway, SUVs are flying off the lot. Last week, former White House chief of staff Andy Card dropped by to pick up a new SRX, Caddy's midsize SUV, says dealer Daniel Jobe. But Jobe's hottest seller, by far, is the newly redesigned chrome-encrusted Cadillac Escalade, an incredible hulk that gets 13mpg in the city. "My biggest problem is not gas prices," says Jobe, "it's getting enough of these trucks."Grousing about gas prices has become our new national pastime. As it turns out, we're griping while we guzzle. Since Katrina gave us our first $3 pump prices last fall, gasoline consumption in this country has actually risen, confounding the energy experts who recall how much we throttled back on our gas usage following the '70s oil shocks. Where are we burning all this gas? In big...
  • The Long and Grinding Road

    At 5:40 a.m., the alarm blares news-talk radio and Bill Small rolls out of bed. With a two-hour commute ahead of him, the Chicago doctor wastes little time. He showers, dresses and is out the door by 6. At this hour, his car is the only one navigating the winding streets of his upscale neighborhood in St. Charles, Ill., a quaint community nearly 50 miles west of the Chicago hospital where he works. Small's routine is so finely tuned that he won't stop for coffee if there are more than three cars in the drive-thru. Today there are just two, and he picks up an extra-large. But there's no time for a bathroom break, so Small, 41, won't allow himself a single sip for nearly an hour. At the halfway mark, he takes his first swig as he hits gridlock on the Eisenhower Expressway. With the sun rising over the Chicago skyline, he crawls along, placidly listening to sports radio. Finally, he arrives at exactly 8 a.m. Though he won't return home for 12 and a half hours, Small still says the...
  • Fighting Back

    This is a tough time to be Rick Wagoner. The embattled chairman and CEO of General Motors is facing a growing chorus of critics calling for his head. With his company losing $10.6 billion last year and Toyota on the verge of overtaking GM as the world's No. 1 automaker, Wagoner has become the personification of Detroit's declining fortunes. He's struggling to engineer a turnaround by closing a dozen factories, offering buyouts to all 113,000 of his blue-collar workers and trying to jump-start sales with new SUVs at a time of high gas prices. Last week his job got even harder. First, GM revealed a widening probe into its accounting practices by the SEC and a federal grand jury. And then Delphi, the bankrupt car-parts maker once owned by GM, asked a judge on Friday to toss out its labor contracts. That could ultimately spark a strike that could drive GM into bankruptcy, analysts say. Wagoner, 52, has kept a low profile as the criticism has mounted. But now he's decided to come out...
  • GM's Game of Bumpercars

    Even before Jerry York elbowed his way onto General Motors' board last month, he was stirring things up inside the sputtering automaker. In a speech during the Detroit Auto Show in January, the veteran turnaround artist recommended a radical repair job for GM that included dumping its Saab and Hummer divisions. "Saab and Hummer," York said, "will not save GM." The old guard immediately declined to follow York's advice, and last month GM vice chairman Bob Lutz told the media that York had undergone a conversion since becoming a GM director and now backed Saab and Hummer (despite the fact that Saab's a money-loser and Hummer sells in relatively small numbers). York responded with an e-mail to Lutz saying he still wasn't sold on Saab and Hummer, and chided him for putting words in his mouth. Lutz, one of Motown's biggest stars, went on a Detroit radio station the next day to eat crow. "Jerry would like me to say," a chagrined Lutz said, "that he's gone from negative on Saab and Hummer...
  • Detroit Muscles Up

    GM chief designer Ed Welburn sweeps into his Chevrolet design studio and it's as if he were stepping back in time. On one side of the cavernous white room, designers huddle over a silver retro remake of the Chevy Camaro. A few steps away, stylists scurry around a future Chevy family car that ripples with sinewy muscles from a bygone era. Papering the walls of the studio are photos of classic iron from Detroit's halcyon postwar years--the chiseled '65 Chevy Impala, the jet-age '65 Ford Galaxie, the long-nosed '65 Plymouth Fury. Welburn slowly walks around the work-in-progress family car, inspecting the latest nips and tucks. Suddenly, he notices an 18-inch clay model on a table nearby that offers an alternative take on the car with a gull-winged rear end. "Oh, my God," the normally soft-spoken designer shouts. "That rear is unbelievable! It links all the way back to the late '50s."Detroit, desperate for a few hits, is driving in a new direction: back to its glory days, when its...
  • Outsourcing: Silicon Valley East

    During the height of the dot-com boom, Dan Scheinman was one of Silicon Valley's most popular tech execs. As the chief of mergers and acquisitions for Cisco Systems, he couldn't go to a party without being besieged by entrepreneurs eager to sell their business to the deep-pocketed tech giant. Now Scheinman is once again the toast of dinner parties, but he's being pitched on new properties over tandoori chicken and Darjeeling tea in Bangalore. For Cisco, India is the new frontier, where it's investing $1.2 billion to build a gleaming R&D campus that will employ 3,000 people. "Bangalore feels like the center of the technology world," says Scheinman. "There's a level of chaos, energy and a sense that anything is possible."Not long ago, what seemed most possible was that India would steal the jobs of American workers. But as George W. Bush visits there this week, he'll find a maturing economy that is no longer all about call centers and basic tech support. Now big American...
  • International Periscope

    Nearly six years after the first dot-com bubble burst, the lesson is clear: "Nobody ever learns anything," says Tim Price, chief investment officer for brokerage Ansbacher & Co. in London. After beating estimates for many quarters--and hitting a high of $475 on Jan. 11--Google reported disappointing earnings on Jan. 31, which knocked some $40 billion off its market value. Then came last week's cover story in the financial weekly Barron's, which simply tallied up all the threats against Google and warned that if 2006 profits were 30 percent lower than expected, the share price could be cut in half. Suddenly noting the rise of competition from Yahoo! and Microsoft, as well as the threat of "click fraud" to its advertising franchise, investors again dumped the shares, closing the week at $369, 22 percent off the peak.What investors seemed to forget was that there is nothing new about stock-market valuations--they should reflect the present-day value of expected future earnings. Yet...
  • Renovating Martha Inc.

    When Martha Stewart's people first approached KB Home CEO Bruce Karatz last May about building mini-versions of Martha's mansions, he was skeptical. After all, Stewart was still under house arrest for her conviction in the ImClone stock scandal. "There was a little risk that the public might not forgive her," says Karatz. But Stewart laid out an enticing deal to design Martha manses for the masses, priced between $200,000 and $450,000, that can be tastefully decorated by you-know-who. So Karatz agreed to an experiment: he'd build 650 Martha homes in Cary, N.C., and see how it went. The reaction: 3,800 home buyers wanted in. And Martha sent each of them a hand-signed thank-you note. If she's going to keep that up, she'd better be ready for writer's cramp. This week, KB will announce plans to build "Marthavilles'' in seven more cities, from Orlando to L.A.One year out of the big house, Martha Stewart is finally starting to rebuild her own house of style. Oh, sure, there have been...
  • 'You Were Terrible'

    Look out Martha, the Donald is gunning for you. "I'm tired of Martha blaming me for her failure," Donald Trump roared over the phone to NEWSWEEK on Tuesday.Trump was referring to comments Martha Stewart made in the current edition of NEWSWEEK about why her version of "The Apprentice" failed. (NBC declined to renew Stewart's version of the program after its initial season). And he fired off a letter to the domestic diva assailing her for suggesting that her show suffered from "Apprentice" overload because it was on the air at the same time as his.In the NEWSWEEK story, Stewart contends she was supposed to have fired Trump on the air, leaving her show as the sole "Apprentice" on NBC. "Having two "Apprentices" was as unfair to him as it was unfair to me," Stewart said. "But Donald really wanted to stay on."Trump's response: "It's about time you started taking responsibility for your failed version of "The Apprentice"," he wrote in a Feb. 21 missive to Stewart that he shared with...
  • Detroit: Hoping for a Small Victory

    Motown's mantra has always been "bigger is better." But now that General Motors and Ford are cutting a combined 60,000 workers and closing more than two dozen factories, Detroit is slowly and painfully learning to live with less: fewer employees, fewer plants, fewer paying customers. "For too long, we've used the advantage of size to avoid change," Bill Ford said in a televised address from his company's design studios last week, where he shrank his payroll by 25 percent and encouraged his remaining employees to "think like a small company." ...
  • Fixing Ford

    For the most important speech of his career, Ford Motor Co. CEO Bill Ford on Monday stood on a makeshift stage inside a car design studio that reeked of modeler's clay. Flanking him were two sculptures of high-style concept cars Ford has unveiled at the last two Detroit auto shows: the sleek hybrid-powered Reflex sports car and the Ralph Lauren-inspired Fairlane sport wagon. The setting seemed ideal for Ford to unleash a new model revolution, declaring no more boring cars at America's reeling No. 2 automaker. And that seemed to be where he was heading when he stepped up to the podium. "Today," he intoned dramatically, "we declare the resurgence of the Ford Motor Co."Ford's address came just before his company announced it would close 14 factories and cut up to 30,000 jobs--about 25 percent of its North American staff--over the next six years. Yet even when Ford did provide details on his eagerly awaited "Way Forward" restructuring plan, he refused to fill in some key blanks. For...
  • Curtain Calls

    As I look back on the Detroit Auto Show of 2006, I will remember it as the contrition car show. This is the show where automakers--chastened by high gas prices and driver defection from drab designs--were out to atone for past sins. There was the new crop of gas-sipping micro cars from Japanese automakers who were once unwilling to bring such diminutive models to America. From Detroit's Big Three there were smoothly styled crossover SUVs that are easier on the eye and the wallet than their incredible hulks of the past. Toyota, frequently dinged for its "blandmobiles," rolled out more highly styled flagships in the new Camry and Lexus LS. And General Motors and Chrysler made a bold grab back to the days Detroit muscle ruled the road, with glorious remakes of the Chevy Camaro and Dodge Challenger.Everywhere I roamed in Cobo Hall these last three days, I heard mea culpas. "For a while we did really bad cars," said GM Vice Chairman Bob Lutz, acknowledging Detroit's bad old days of slip...
  • Detroit Reloaded

    Move over Hollywood. Detroit is the new home of the sequel. At least that's what it felt like at the Detroit Auto Show this week.The remake of the Chevy Camaro was the King Kong of the Detroit show on Monday, day two of the press preview. Gawkers buzzed around it like biplanes long after it was unveiled by General Motors execs in the morning. Across crowded Cobo Hall, the reborn Dodge Challenger was also getting its fair share of attention, with a constant stream of camera crews giving the orange muscle car its close-up. Both cars are headed for a street-rod smack down with the hot-selling reinvention of the Ford Mustang. With all the testosterone pouring from those tailpipes, you would have thought it was 1970 again (and wouldn't Detroit love that?).Of course, as Hollywood knows so painfully, not all sequels pan out, some just get panned. Detroit has learned that lesson, too. GM's tepid remake of the Pontiac GTO two years ago got about as much traction as "Herbie: Fully Loaded."...
  • Showtime at the Cobo

    As the Detroit Auto Show opened to the media on Sunday, America's two biggest and most beleaguered automakers, General Motors and Ford, tried desperately to change the subject from their banged up finances. There were dazzling new promotional displays for each, with immense video walls so frenetic you could get car sick just watching them. There were outrageous concept cars, like the over-the-top Ford Super Chief $100,000 pickup chronicled in this week's Drive Time preview.There was also much executive talk about how well the two companies are doing outside of the United States. (GM is now No. 1 in China, don't you know?) GM even resorted to the old school Motown trick of parading out statuesque models (of the feminine, rather than automotive variety) in gowns so sheer you could see their black undergarments. While that display was enough to give me a serious case of whiplash, it wasn't enough to distract from GM and Ford's combined $6.2 billion in losses in the North American car...
  • Autos: Going the Extra Mileage

    Inside Ford Motor Co.'s cavernous wind tunnel, a thin stream of smoke glides gracefully over the new Lincoln Zephyr. But what catches the eye of aerodynamic engineer Wayne Koester is a tiny somersault of smoke just where the back window hits the trunk. "Do you see that?" he says, pointing from behind the control-room window. "That's turbulence." And turbulence is the archenemy of aerodynamics. Koester tried to persuade Lincoln's designers to lower the trunk to improve mileage. But they balked, saying Lincoln's customers demand a big trunk to haul golf clubs. The result: the Zephyr gets 45kpg on the highway--1.6kpg less than its sister car, the Ford Fusion.These days, though, mileage misers like Koester are gaining traction in Motown. With oil prices high and likely to go higher, Detroit is painfully rediscovering the eat-your-peas merits of fuel economy. General Motors and Ford combined to lose $5 billion in their auto operations in the third quarter as gas prices skyrocketed:...
  • The Blue-Collar CEO

    For a carmaker, choreographing an elaborate new model show for its dealers can be as routine as an oil change. But at a rehearsal last month for a Chrysler extravaganza inside an enormous Las Vegas arena, the carmaker's past and future leaders struggled to pass the baton. The script called for the UNLV marching band to blare "Viva Las Vegas" while high-stepping through a crowd of 7,000 car dealers to deliver a baton to the stage, where former Chrysler CEO Dieter Zetsche was to hand it to the new guy, Tom LaSorda. But the day before the show, as the execs rehearsed without the band, it was clear the new model is nothing like the old one. Zetsche, with his vaudevillian mustache, is a natural, mugging for the imaginary crowd while grabbing for a baton twirled by a lone UNLV majorette. LaSorda, a former factory boss, was awkward under the hot lights. He stepped on Zetsche's lines, stood in the wrong spot and struggled to read the tele-prompter. Finally, the big moment arrived: Zetsche...
  • Exit Interview: A Showman's Parting Shot

    When Dieter Zetsche arrived at Chrysler five years ago, Detroit viewed him with deep suspicion. With Chrysler sinking fast after its messy merger with Daimler-Benz, the mustached former Mercedes exec was cast as a storm trooper coming to strip America's No. 3 automaker of its swagger. Instead, Zetsche pumped up Chrysler's American attitude with brash cars like the 300C. And he re-engineered Chrysler into Detroit's only moneymaker. Eventually, Motown embraced him. Bill Ford even tried to hire him.Now as he heads back to Germany to run DaimlerChrysler, Zetsche has one piece of unfinished business: he'd like to distance Chrysler from Detroit. For starters, he wants to banish the term "Big Three" because it connects Chrysler with its money-losing crosstown rivals. Chrysler, after all, is gaining market share--not ceding it to the Japanese like GM and Ford. "Customers want to be associated with winners, not losers," he says. "If the Big Three is synonymous with a pack of losers, it is...
  • Go the Extra Mile

    Inside Ford Motor Co.'s cavernous wind tunnel, a thin stream of smoke glides gracefully over the new Lincoln Zephyr. But what catches the eye of aerodynamic engineer Wayne Koester is a tiny somersault of smoke just where the back window hits the trunk. "Do you see that?" he says, pointing from behind the control-room window. "That's turbulence." And turbulence is the archenemy of aerodynamics. Koester tried to persuade Lincoln's designers to lower the trunk to improve mileage. But they balked, saying Lincoln's customers demand a big trunk to haul golf clubs. The result: the Zephyr gets 28mpg on the highway--1mpg less than its sister car, the Ford Fusion. "I'd rather have the trunk lid lower; it would look better and have better aero," Koester says. "But it always becomes a compromise."These days, though, mileage misers like Koester are gaining traction in Motown. After two decades of high-octane growth in horsepower and heft, Detroit is painfully rediscovering the eat-your-peas...
  • Burning the Furniture

    Steve Miller, CEO of newly bankrupt U.S. car-parts maker Delphi Corp., has always known how to cut the tension in difficult situations. Last month, with Delphi in feverish (and ultimately fruitless) negotiations for a bailout from General Motors, Miller found himself sitting beside GM CEO Rick Wagoner at an executive confab in Washington. Miller's BlackBerry buzzed. It was a flaming e-mail from an employee. "You are a rapist and a pillager and a thief of the working man's rights," it read, "and may you rot in hell." Miller showed it to Wagoner, saying: "Hey Rick, this one's for you."His gallows humor aside, what Miller has to say is no laughing matter. The corporate fireman behind bankruptcies at Bethlehem Steel and United Airlines is loudly proclaiming an uncomfortable truth: America's industrial giants are collapsing under the weight of pension and health-care costs. Spun off from GM in 1999, Delphi is losing billions because its hourly labor costs are at least three times as high...
  • Motown Mechanic

    Steve Miller, CEO of newly bankrupt Delphi Corp., has always known how to cut the tension in difficult situations. As a young Chrysler exec during its 1980 federal-bailout talks, he once pulled out a toy pistol at a bankers' meeting and held it to his head, saying: "If you guys can't agree on this stuff, I'm going to have to kill myself." Last month, with Delphi in feverish (and ultimately fruitless) negotiations for a bailout from General Motors, Miller found himself beside GM CEO Rick Wagoner at an executive confab in Washington. Miller's BlackBerry buzzed. It was a flaming e-mail from an employee. "You are a rapist and a pillager and a thief of the working man's rights," it read, "and may you rot in hell." Miller showed it to Wagoner, saying: "Hey, Rick, this one's for you."His gallows humor aside, what Miller is engineering is no laughing matter. Since he arrived this summer to save Delphi, the feared and revered corporate fireman is loudly proclaiming an uncomfortable truth:...
  • New Perils At The Pump

    Hummer drivers, welcome to the era of the $100 fill-up. No matter what you drive, the new normal is monthly gas bills that look like car payments. After a year of $2-a-gallon gas, we worry that it could pass $3 and approach the inflation-adjusted record. Analysts blame a combustible mix of Mideast instability, Chinese demand and overtaxed refineries. The result: accelerating inflation.The effect is most dire in Detroit, which still derives most of its profits from SUVs and pickups. The national average for a tank of gas is about $2.55. The Big Three always viewed $3-a-gallon gas as the threshold that would drive car buyers out of their guzzlers and into gas misers. But consumers have already started changing their habits. Even before this summer, sales of big SUVs were off significantly. Now Detroit is scrambling to re-engineer its lineup. Chrysler's new CEO, Tom LaSorda, is asking his engineers to look at sacrificing horsepower for mileage--once heresy in Motown. "No economist in...
  • CRUISING ON CAMPUS

    When Morris Lifschutz began his sophomore year at the University of Southern California in 2004, he noticed a lot more hot cars cruising campus. So he and a buddy decided to restart something USC hadn't had in more than a decade: a car club. To attract members, they parked four sweet rides at the foot of the Tommy Trojan statue, hired a DJ and handed out fliers. The result: the Trojan Racing Club quickly swelled to 130 members. By the end of the year, Lifschutz was staging the "Super Sport Auto Show." The only problem was, he spent more time on the show than studying for finals.For years college students were more interested in laptops than a hot set of wheels. But now, thanks to shows like "Pimp My Ride," movies like "The Fast and the Furious" and videogames like Gran Turismo 4, the campus crowd is once again coveting cars. Last year they spent about $15 billion purchasing 1.5 million cars, according to a Harris 360 Youth Survey. (How can they afford this? Mom and Dad buy a quarter...
  • MARTHA 'LIVING' AT LAST

    Martha Stewart is finally getting sprung from her own big house. About Aug. 11, Stewart will end what she calls her "hideous" house arrest at her Bedford, N.Y., estate. On her to-do list: finding a signature version of "You're fired!" for "The Apprentice: Martha Stewart," which debuts in September. One rejected try: "Your ass is grass." She's already filming "The Apprentice" and segments for her daily how-to show, "Martha." And to help boost her magazine, she invited advertisers to visit her in home confinement. Since her house arrest began in March, ad revenues are up 42 percent at Martha Stewart Living, though they're still off by more than half compared with before the ImClone insider-trading scandal. She'll also begin appearing in ads for her new Opal Point line of beds, sofas and dining sets. "It's been a roller-coaster ride," says Alex Bernhardt, whose company makes Stewart's furniture, "but we're on the good part of the ride now."She's on probation until March 2007, which...
  • IF YOU CAN FIND A BETTER PITCHMAN...

    A lot has changed since Lee Iacocca last appeared in a Chrysler ad in 1992, just before he retired. The cushy land yachts of his day have given way to wicked whips like the Chrysler 300C favored by rapper 50 Cent. And yet the octogenarian is making a comeback. He's costarring in a new Chrysler commercial with Jason Alexander of "Seinfeld," who utters Iacocca's trademark line: "If you can find a better car, buy it."Here's the score: Chrysler, badly beaten by GM's "employee discount" deal last month, is playing catch-up with its own "employee pricing" plan. And it needed a commercial that would "shock and awe," says vice president Jason Vines. But at what cost to its hip new image? "Like this is going to make young people look at their cars," says analyst Wes Brown of Iceology. "No way."Chrysler, which threw these ads together in a week, says Iacocca is still an icon. And it has committed to at least two more commercials, including one where an actor playing his granddaughter utters...
  • REVVING UP GM

    There hasn't been much to celebrate at General Motors lately. So as its "employee discount for everyone" deal filled showrooms last month, the automaker's new marketing chief, Mark LaNeve, gathered his troops in Orlando, Fla., for a love-in. Wearing tie-dye and peace medallions, LaNeve and a few hundred sales managers danced into the night at a psychedelic '60s party on Disney's Pleasure Island. The morning after, the mood is less pleasant inside a conference room as LaNeve lays out GM's complicated repair job. Jumping onstage to "Let's Get It Started," the broad-shouldered, ham-fisted former collegiate linebacker does his best Knute Rockne. He commiserates. "What is all this bulls--- about GM," he grumbles, "and how no one likes our cars?" Then he scolds. "Folks, we cannot hit our objectives with numbers like this," he says of abysmal sales in big cities. Finally, he does something once unheard-of for a GM exec: he admits the competition just might have better moves. "If you see...
  • Q&A: COUNTING THE MILES

    Honda is so obsessive about having the best gas mileage on the road that Charlie Baker, its U.S. chief engineer, once crawled underneath a BMW at a car show to gather some competitive intel. Baker wanted to make sure the SUV he was developing, the Acura MDX from Honda's luxury division, would top BMW's X5, so he was snapping photos of the Beemer's underbelly to size up its aerodynamics. A BMW exec tugged on his leg, asking, "Can I help you, sir?" Baker's response: "Not unless you have a jack."Despite the megawatt buzz about the Toyota Prius, Honda actually tops the charts for fuel economy among auto-makers in America. Of the 10 best gas misers on the road today, Honda has seven of them, according to the EPA. Honda also offers more hybrid models--three--than anyone else (though Toyota will soon catch up). Honda has always made leading in fuel economy a bedrock principal, even when American car buyers could not care less. But with gas and oil prices remaining stubbornly high, drivers...
  • A COLLISION COURSE FOR GM AND THE UAW

    As GM's engine stalled this year, CEO Rick Wagoner has laid much of the blame on the automaker's runaway health-care costs. And he's pushed the United Auto Workers union to give concessions on its generous medical bennies (no deductibles, tiny co-pays). The union has steadfastly refused to reopen its contract, which runs until 2007. So last week Wagoner ratcheted up the pressure. While announcing plans to cut 25,000 jobs and close factories by 2008, he promised to find a way to "promptly" reduce GM's health-care burden--with or without the union's help. The UAW fired back that GM can't "shrink its way" to prosperity, but instead needs to design cars people want. By late last week the war of words had escalated. "If we don't fix some of the basic problems that exist when it comes to the product," UAW president Ron Gettelfinger told NEWSWEEK, "then it seems to me that no matter what we did, it wouldn't be enough. Ever."GM is on a collision course with its union over health care. And...
  • 10 Big Thinkers for Big Business

    THOMAS MIDDELHOFFIt's not a glamorous comeback. After all, the last time Thomas Middelhoff sat in the corner office, he was one of the top dealmakers of the Internet bubble years, buying up companies for one of the world's great media conglomerates, Bertelsmann A. G. His ambitions eventually backfired when Bertelsmann's controlling Mohn family bucked his move to take the company public. In 2002, Middelhoff was ousted. And so his appointment this May as CEO of KarstadtQuelle, a large but downtrodden German retailer, came as both a comedown and a surprise, since second chances are rare in corporate Europe. Now his own re-emergence as head of a 13 billion euro giant could be taken as a sign of what he says Europe still needs in its corporate leaders: "courage."Middelhoff, who proclaims himself "an American at heart," is referring not only to the obvious need for further macroeconomic reform in sclerotic economies like Germany and France, but also the need for European businesses to...
  • 10 BIG THINKERS FOR BIG BUSINESS

    Last year Omidyar shook up the philanthropic world by converting the foundation he and his wife, Pam, established in 1998 into the Omidyar Network, which will direct money not only to traditional nonprofits, but to profitmaking businesses as well--as long as those enterprises create what Omidyar calls "positive social impact."Omidyar says he was inspired by the lessons of eBay, which "taught 150 million people that they can trust a complete stranger," and also by his work on the board of Meetup.com, the online service that allows members to connect over some shared interest. "It occurred to me that there's a type of business that can only be financially successful if it helps make the world a better place," says Omidyar.Unlike traditional charities dedicated to curing diseases or building museums, the Omidyar Network is a curious hybrid: part philanthropy, part venture capitalism. "It's not about giving away money or providing aid or help," says Omidyar. "I like to think of it as an...
  • THE INTERPRETER MOVES IN

    Inside Ford Motor Co.'s top-secret design studio, stylists gather around a hulking clay model of a work-in-progress pick-up truck. Their boss, Peter Horbury, sweeps in, throws off his suit coat and declares: "Let's do some designing, shall we?" But while the workhorse vehicle before him is quintessentially American, Horbury, who moved to Detroit only last year, speaks like a proper British gentleman; until a year ago he was designing Jaguars. "I'm learning to speak truck," he confesses.Ford's new U.S. design director is best known for having given Volvo a Swedish-style makeover; now he's intent on bringing out Ford's American spirit. His charter is to draw up a bold new look for the automaker's mainstream cars to help reverse a decade-long skid in sales. With gas prices soaring to record levels, Ford's SUV sales are plummeting at what CEO Bill Ford calls a "breathtaking" pace. Guzzler fatigue is finally bringing the traditional family car back in style, but Chrysler's hip-hop 300C...