Government Ownership and Your Next New Car

Will you be more or less inclined to buy a car manufactured by GM or Chrysler when you buy your next vehicle? Will management decisions for these companies reflect a political agenda or will decisions be made to ensure the profitability of each corporation?

General Motors will soon be a corporation that is 60% government-owned. The company is set to emerge from bankruptcy. By the end of the year, the federal government will have put $50 billion into GM and more than $12 billion into Chrysler, along with tens of billions more to suppliers, lenders and GM’s former credit company, GMAC.

Administration officials say they will leave day-to-day operations to the board of directors for each company. "We are not going to micromanage" according to a member of the federal government’s auto task force.

The Obama administration has appointed the former chief executive of AT&T as an independent chairman of the company.

The chief executive of General Motors, Frederick Henderson, plans to introduce the company as a more customer-focused company. And, while GM has dominated the market for pick-up trucks for a number of years, the overall fuel economy of the fleet of cars offered is not as good as other companies as a result.

Will you be more or less inclined to buy a car from General Motors or Chrysler with each company having substantial government ownership? And, while it is clear that the federal government has had major involvement in selecting senior management, do you think future company decisions will reflect the administration’s political agenda or will decisions be made based on taking steps necessary to ensure profitability of each corporation?

Here are the results of this survey from FedSmith readers.