In the Driver's Seat

Redefine the labor-management compact. Instead of fighting over table scraps at the Last Supper, how about if bosses and working stiffs figure out a way to get along? This means ceding power on both sides: Management needs to seek and accept input from the factory floor on how to better build cars. The union needs to loosen up the restrictive rules that prevent workers from being jack-of-all trades in the factory. You need a flexible workforce in those flexible factories to respond to the ever-changing whims of the marketplace. This, by the way, is part of the secret of the success of foreign automakers' American factories.

Haircuts all around. Yes, workers need to give up some of their wages and benefits. (By the way, GM assembly plant workers make about $28 an hour, not $73. That bigger number includes benefits and the huge cost of paying for retirees' pensions and health care. Foreign auto factories in the U.S. have virtually no retirees.) Management also needs to give back more than just their private jets and big bonuses. Whatever wage cut a factory worker takes, white-collar staff should sacrifice an equal percentage of their salary. The bond holders need to accept about 30 cents on the dollar, which would actually represent a nice premium to the 18 cents on the dollar GM's long-term bonds are trading at these days. Stockholders should kiss dividends goodbye for a long time.

As many as two-thirds of dealers need to be shown the door. Strong state franchise laws have prevented Detroit from culling its dealer herd for years. The all-powerful federal car czar should be able to trump those state laws and whittle the not-so-Big Three's retail network down to a size that reflects Detroit's diminished reality, not yesterday's automotive oligopoly.

Finally, listen, learn and get out of the way. Detroit is a big, complicated industry, with billion-dollar bets on each model and more moving parts than an Apollo rocket. A czar who gets lost in the weeds of micromanaging is doomed to failure. He or she needs to create a framework for success and accountability and then let the car creators do their work.

So where does this road map lead for Lisa Mora-Jackson? If GM succeeds, she could find work there eventually, though at reduced pay and increased responsibility. But like GM, time is rapidly running out for her. She pulled $14,000 out her 401k to pay bills, but that's dwindling. "I'm worried," she says. "All I can do is cut back, save money and look for extra work."

Shaiken fears workers like Mora-Jackson could become the early victims of a diminished Detroit. "She didn't decide not to produce small cars," he says, "but now the burden of failure falls on her." How the car czar steers Motown into the future, ultimately could determine the fate of thousands of workers like her.

With Mary Chapman

© 2008