GM Looking For Third CEO In Less Than A Year
STEVE INSKEEP, host:
There's one more layoff at General Motors at the top of NPR's business news.
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INSKEEP: This time it's the CEO. Fritz Henderson was asked to leave yesterday by the company's board of directors. The move comes nine months after Henderson's predecessor was also forced out - that time by the government. Henderson had been under increasing pressure from GM's board. And in recent weeks differences had surfaced between Henderson and GM's board chairman. The board chairman is the former AT&T executive the government brought in to help run the company, and he's going to take over as CEO for now.
Michigan Radio's Tracy Samilton has more on this surprise move and what's next for GM.
TRACY SAMILTON: In March, the Obama administration's auto task force asked 25-year GM veteran Fritz Henderson to lead the automaker after forcing the resignation of Rick Wagoner. In a few months, Henderson steered GM through a perilous bankruptcy, shedding enough of the company's massive debt to make its survival possible. But his job ended yesterday, announced at a hastily arranged news conference. Henderson's boss Ed Whitacre, the board chairman picked by the U.S. Treasury, is temporarily taking over. Whitacre says Henderson put GM on the right path.
Mr. ED WHITACRE (General Motors): But we now need to accelerate our progress toward that goal, which means a return to profitability and repaying the American and Canadian taxpayers as soon as possible.
SAMILTON: Whitacre says he'll explain the decision in more detail in a few days. So it remains speculation if it was the sluggish sales or the big third quarter loss or the timetable for paying back some of the government's $50 billion investment. Jim Hall is with the consulting firm 2953 Analytics. He thinks whatever the reason, it was probably inevitable.
Mr. JIM HALL (Analyst, 2953 Analytics): In a lot of ways Fritz Henderson was the man who was born to get GM through a bankruptcy. And I mean that actually, that's praise and it's significant praise. And he did it.
SAMILTON: Hall says what Henderson is not is the big-picture person with big ideas that GM now needs. Consultant Sheldon Stone is with the restructuring firm Amherst Partners. He speculates GM might go for an auto outsider, someone who can fix the automaker the way former Boeing chief Alan Mulally fixed Ford.
Mr. SHELDON STONE (Consultant, Amherst Partners): Growing up professionally in the automobile industry isn't necessarily a prerequisite to success in the CEO's seat.
SAMILTON: Other analysts think maybe GM needs an insider but one with a reputation for shaking things up, such as GM's marketing chief, Bob Lutz. Whoever it is has to be in it for more than the money. The federal government has slapped a $500,000 salary cap on the job. Stone says maybe Ed Whitacre should stay on permanently.
Mr. STONE: I wouldn't be surprised if the search led right back to him.
SAMILTON: Analyst Jim Hall thinks not. But for now, Ed Whitacre, the former CEO of AT&T, is in charge of a car company, a big car company. Hall hopes he listens to the engineers and designers remaining at GM, because they have the great ideas and the deep understanding of the auto industry. He says the good news is they're all working for a smaller and healthier organization.
Mr. HALL: GM now is a company that's totally transformed. It's slashed its debt, its operating cost and a lot of its labor costs have been slashed. They have great product in the pipeline. They have great product in the market. It's GM's game to lose.
SAMILTON: Today, GM hopes to play that game to win at the Los Angeles Auto Show, where the company will unveil a small car, the Chevy Cruze and the Chevy Volt, an electric extended-range car that could, if it's successful, start to convince people that GM has changed, and for the better.
For NPR News, I'm Tracy Samilton in Ann Arbor, Michigan.
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