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Detroit will rise again, says Lutz

Bob Lutz, General Motors Vice Chairman

STAN HONDA/AFP/Getty Images

Tomorrow is the last day on the job for Bob Lutz, who retires from General Motors at age 78 after an amazing career in the auto industry. He has held top management jobs not only at GM but at BMW, Ford and Chrysler as well.

He started at GM in Europe in 1963, jumped to BMW in 1971, moved to Ford in 1974 where he's credited with creating the Ford Explorer SUV. In 1986, he went to Chrysler with Lee Iacocca, rising to president. Later, he spent four years as CEO at Exide Technologies and then rejoined GM in 2001 as vice-chairman and head of product development.

Lutz has been known as Maximum Bob for his highly voluble speaking style and as the Ultimate Car Guy for his passion for design and good engineering. He's spent the last nine years trying to break GM out of its old ways and believes that he has helped change GM forever.

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Vaughan: What's the GM like that you leave behind?

Lutz: Design is going to be fine under Ed Wellburn (vice-president of global design). Tom Stephens (vice-chairman for product development) and I share exactly the same philosophy when it comes to product development.

I think the company, especially in the product side - the design and execution of new product which to me is 90 per cent of what a car company is about - that part is all going to be fine.

What would you say was the greatest satisfaction you had in the last nine years.

I think it was transforming the culture from one that took the product for granted and tried to minimize cost to coming to the realization that it didn't work.

It's been transforming the culture into one that has a laser-like focus on the world's best cars and trucks in every segment of the market.

Transforming the culture into one that has the boldness to do something like the Chevrolet Volt, the Cadillac CTS V Wagon, the Corvette ZR1 - you name it.

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This company can arguably do it better than any other company in the world. The market success of our new product is showing that.

So I think the whole culture is transformed now from one that said if we save a little bit here and a little bit there the customer won't notice it to one that says the customer deserves the best. If it makes the car better we're going to put it in even if it costs a few dollars more.

What do you see for the future of Detroit auto industry? Are you optimistic? Pessimistic?

I'm optimistic because I think Ford is largely back and we're coming back and Chrysler, too.

We're going to repay the government over a few years - it takes a while to pay back $55-billion - but it is one of our uppermost goals.

Contrary to a few years ago when the situation in Detroit was almost hopeless with our health-care obligations, our indebtedness, various expensive practices on the part of the UAW, a relatively strong dollar, a very weak yen - all of these things worked against us in Detroit.

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We now have a much stronger yen, which is putting a lot of pressure on the Japanese, we got additional concessions from the UAW so we can now say our UAW wage is the same as the non-union Japanese companies down south. We no longer have the crushing debt burden or the health-care burden.

So I'd say right now the U.S is a good place to build cars. I see Detroit coming back big-time.

Are you going to miss us journos?

I think so. I think so.

I greatly enjoyed the interaction and I notice all this outpouring of friendliness and goodwill now that I'm leaving. Where was all this friendliness and goodwill when I needed good press?

Michael Vaughan is co-host with Jeremy Cato of Car/Business, which appears Fridays at 8 p.m. on Business News Network and Saturdays at 2 p.m. on CTV.

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