Detroit's automakers suffered from "stunningly poor management" before the federal government took over the companies, President Barack Obama's former top auto adviser said Wednedsay.
Steven Rattner, the administration's onetime "car czar," blasted the former leadership of Chrysler and General Motors the government encountered earlier this year when it began mulling a bailout for the firms.
"Everyone knew Detroit's reputation for insular, slow-moving cultures," Rattner wrote in an article for Fortune Magazine. "Even by that low standard, I was shocked by the stunningly poor management that we found, particularly at GM, where we encountered, among other things, perhaps the weakest finance operation any of us had ever seen in a major company."
Rattner, who returned to private live as a financier after guiding the companies through their bailouts, described cultures of "arrogance" in the companies, especially at GM.
He said that the president's Auto Task Force and other senior administration officials had been "terrified" by the prospect of bankruptcy for the companies, and even considered liquidating Chrysler in order to assist GM.
But Rattner warned that while a "successful recovery is far from assured," the companies are in better shape than how the government had found them earlier this year.
"By dramatically lowering the break-even point for both companies, we believed we were creating a healthy margin for error," Rattner said.