House Majority Whip, Congressman James Clyburn, suggests that the CEO’s of Ford, Chrysler and GM should quit as a condition for Congressional approval of the $25 billion bailout plan.  Here’s the link:

http://www.wnem.com/news/18181663/detail.html?rss=sag&psp=news

This is incredibly short-sighted.  Certainly, the auto executives did themselves no favors by flying private jets to DC.  And, certainly, the leadership of the auto companies have made some very bad decisions over the years.

But I would point out that Alan Mulally, the leader of Ford, has made some very good decisions during his several years running Ford Motor Company.  He was far-sighted enough to envision the possibility of a credit crunch and opened a $10 billion line of credit for Ford when money was plenty and rates were low.

Now, Ford has a $10 billion cushion that the other companies do not have.

Mulally, the former head of Boeing, has also made the very good strategic decision of fully funding product development.  It would be easy in these times to cut research and development.  GM and Chrysler certainly have.  But that kind of decision is penny-wise and pound foolish.

And Ford seems to have been a bit quicker in responding to the “green” wave than the other auto companies.  Cars like the Focus are small, fuel efficient and popular.  Maybe this has something to do with Bill Ford’s stated love for the environment and his decision to live along the banks of the Huron River in Ann Arbor.

So, the idea that Ford’s executives should be forced out in exchange for the $25 billion seems crazy.

Leadership change often requires a significant period of transition within a company.  To force the CEO’s out of power at a time when weeks and months are all that stand between these companies and bankruptcy seems foolish to me.

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