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Archive for Wednesday, December 2, 2009

General Motors CEO resigns after 8 months

December 2, 2009

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— General Motors Co. CEO Frederick “Fritz” Henderson stepped down Tuesday after the board determined that the company wasn’t changing quickly enough.

Chairman Ed Whitacre Jr. said at a hastily called news conference that he will serve as interim CEO, and an international search for a new CEO and president is planned.

Whitacre thanked Henderson for his work during a period of challenge and change, but said it is time to accelerate the pace of rebuilding the largest U.S. automaker.

The resignation comes just eight months after Henderson, 51, replaced former chairman and CEO Rick Wagoner, who was ousted March 29 by the Obama administration’s government’s auto task force.

Henderson has been with GM his entire career and was the government’s choice to run the beleaguered company after Wagoner left. Whitacre, picked by the government in June to be chairman of the new GM, is considered an industry outsider, having run AT&T Inc. for 17 years.

Whitacre and the board have become increasingly active in the company’s decisions, at times challenging some of Henderson’s decisions. In November, the board voted to abandon plans to sell GM’s European Opel unit. That reversed an earlier option favored by Henderson to sell it to a consortium led by Canadian auto parts supplier Magna International Inc.

Comments

Marion Lynn 4 years, 4 months ago

Of course there is the little-known debacle of Denbeigh, Ltd., makers of the Denbeigh Super Chauvinist; tale told only on dark and stormy nights in dimly lit publs and back rooms.

Most of the board members of Denbeigh died mysterious deaths or simply disappeared and the entire story of the Denbeigh Mk IV Shooting Brake has been lost to time.

Although conspiracy theories abound, it is suspected that the entire truth will never be known.

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MyName 4 years, 4 months ago

You're probably right, but this guy wasn't the CEO of GM before the downturn. He had a harder job (part of which included trying to sell off expensive assets in a downturn) and he couldn't get it done. Ford's management decided it was a good idea to get leaner before any kind of downturn, which was very prudent.

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Sigmund 4 years, 4 months ago

MyName (Anonymous) says… "Granted, some of those deals turned sour on their own, but this is pretty much what they meant when they said GM was “changing too slowly”.

On the other hand Ford began their change BEFORE the downturn. In September 2006, Bill Ford stepped down as President and CEO, and naming Alan Mulally as a successor. In June 2008, Ford sold its Jaguar and Land Rover operations to Tata Motors for $2.3 billion. A couple of months later and they would have had a hard time selling to anyone at any price. That move alone has allowed Ford to not take a penny of taxpayer dollars and therefore the only Detroit auto maker I will ever do business with.

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Sigmund 4 years, 4 months ago

jonas_opines (Anonymous) says… "Ummm… . yeah. I'm sure that the purpose of Lambos and Ferraris was originally affordability, just bastardized by communism."

Ferrari was hired by Alfa Romeo cars in 1938, Enzo started his own car company in 1941 when Alfa Romeo was confiscated by the Fascist government of Benito Mussolini as part of the Axis Powers' war effort. Alfa's were hardly the stuff of the rich and famous, but were more than the Volkswagon's "peoples car" of the National Socialist German Workers’ party of Hitler's Germany.

Ferruccio Lamborghini was a tractor builder who though Ferrari's were crap and formed his own car company. He got the idea that if Enzo Ferrari, or anyone else, could not build him a perfect car, he might be able to simply make such a car himself. Definitely more of a car for the Capitalist Pig's as opposed to the Bourgeois Pig's in Italy.

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MyName 4 years, 4 months ago

He was ousted because he couldn't do his job, which was to sell parts of GM that weren't going to help the company in the future. To quote The Economist:

"Mr Henderson had set great store on slimming the car company down to four brands: Chevrolet, Cadillac, GMC and Buick. Chevys were to be the volume products, alongside slightly grander Buicks, luxury Cadillacs and the SUVs of GMC. Hummer, Saab, Saturn and Opel/Vauxhall were to be sold off. But the sale of Hummer has yet to be concluded while the deals to sell the other three have all come to grief. The consortium of Swedish and Chinese firms that had agreed to take over Saab dropped out last month, two months after the sale of Saturn to Roger Penske, a car retailer, fell through. A month ago the board threw out the Opel/Vauxhall deal Mr Henderson had arranged to sell the European end of the company to a combination of Magna, a big Austro-Canadian partsmaker, and Sberbank, a Russian state-owned bank."

http://www.economist.com/businessfinance/displaystory.cfm?story_id=15009388

Granted, some of those deals turned sour on their own, but this is pretty much what they meant when they said GM was "changing too slowly".

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jonas_opines 4 years, 4 months ago

"So Communism can be said to have built some fine cars, that virtually no one can afford."

Ummm. . . . yeah. I'm sure that the purpose of Lambos and Ferraris was originally affordability, just bastardized by communism.

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Sigmund 4 years, 4 months ago

jafs (Anonymous) says… "Ford is obviously doing better than the others, which is great, but does it really take a genius to make cars people want to buy?"

And meet all health and safety regulations, and all environmental regulation and CAFE standards, and priced high enough to meet all the Union wages and work rules and benefits, and pay for pensions and health care costs of decades of retirees at a time when nearly 20% of the population is either unemployed or under employed, and when the people that lend you money, your secured creditors, were just wiped out by the current administration in order to pay off the Unions? I imagine that might be slightly more difficult than it first appears to be.

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jafs 4 years, 4 months ago

The "best and brightest" are not running American corporations.

If they had been, we'd never have seen the meltdown in the first place.

Ford is obviously doing better than the others, which is great, but does it really take a genius to make cars people want to buy?

How many millions of dollars/year should be required to find someone to come up with that idea?

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Sigmund 4 years, 4 months ago

Marion (Marion Lynn) says… "Actually, GAZ and ZIL produced some rather fine autos in the old Soviet Union"

More modern communistical cars? Ferrari, Maserati, Lamborghini were all built within 30 miles of the Italian city of Bolonga, which for 50 years, and until 10 years ago, was run by the Italian Communist party. So Communism can be said to have built some fine cars, that virtually no one can afford.

puddleglum (Anonymous) says… "the trabi is king of the EAST! trabant rules"

Look at the competition, as Comrade Clarkson put it, "The Lada Riva is still being built today under license in Egypt. Imagine that, a 40 year old Italian design, improved by the Russians and now built by a bunch of Egyptians. I can't think of anything worse than that!"

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Revenio 4 years, 4 months ago

I have a 2006 Chevy with 55,000 miles that is giving me trouble and the guys at the dealership couldn’t figure out what is wrong. NEVER again.

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jonas_opines 4 years, 4 months ago

"Gov't and business is like oil and water. They do not mix."

Plenty of examples to counteract this. Not so many in the USA, though. Japan, China, Korea, Singapore, Brazil, Hong Kong. Different stages of development, different methods of involvement, different results.

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Ricky_Vaughn 4 years, 4 months ago

lee_go_hawks (Anonymous) says… "They oust one guy and pick his replacement, only to oust him after a few months."

Um, the gov't only "ousted" the first guy, Wagoner...the same guy that ran GM into the ground in the first place. Henderson resigned on his own.

Why are you complaining about the gov't running GM? GM is the one who asked for a handout...they'd probably be bankrupt now without the help.

I'm with imastinker anyway...I'd rather support a company like Ford that didn't have to get bailed out in the first place.

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puddleglum 4 years, 4 months ago

sigmund... the trabi is king of the EAST!

trabant rules

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Sigmund 4 years, 4 months ago

"Communism: Has it ever produce a good car?" Jeremy Clarkson and James May offered their observations on the Emmy Award winning BBC2 show, Top Gear in 2008.

часть один (part one): Ownership of a rev counter is theft and coil springs are elitist! http://www.youtube.com/watch?v=aL3qYcByBHI

часть два (part two): Which was better, Russian or British Communistical cars? http://www.youtube.com/watch?v=sivmMI_4kkA

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monkeyhawk 4 years, 4 months ago

I'm sure everyone is aware of the Rahm Emanuel / Ed Whitacre connection.

If not:

"Crony capitalism played on a scale never before seen.

It turns out that new Government Motors CEO Edward Whitacre has some interesting ties to the Chicago political machine as well as the White House."

http://www.americanthinker.com/blog/2009/06/new_gm_chiefs_ties_to_the_chic.html

re: Emanuel

"His most outstanding deal was helping Chicago-based investment bank Goldner Rauner to purchase an alarm company called SecurityLink in December 2000 from SBC Communications, for $479 million. In June 2001, Goldner Rauner sold SecurityLink for $1 billion to Tyco (ticker: TYC), which was then run by Dennis Kozlowski."

http://online.barrons.com/article/SB122973324821923181.html?mod=article-outset-box

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Flap Doodle 4 years, 4 months ago

A bumpy road ahead for Government Motors.

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Sigmund 4 years, 4 months ago

GM doesn't need a CEO to fail spectacularly and get billions dollars of bailouts for the Union's pension and health care. Nope, they can do that without paying a CEO. As for new cars, well just check out the 2012 Pelosi GTxi SS/RT Sport Edition! http://www.youtube.com/watch?v=rAqPMJ...

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imastinker 4 years, 4 months ago

I won't even buy another GM.

I just spent a months with a 2006 GMC sitting broken because GM didn't pay their suppliers and didn't have the part I needed. They never did get it by the way. I finally found a used one and had it shipped from California at a higher cost than what GM normally charged for it.

Besides that, anything that furthers the UAW and Obama's goals are against what I want to be supporting with my dollars. My next car may be a Toyota and my next truck will be a Ford.

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Lee Eldridge 4 years, 4 months ago

srj, you are correct about the pay issue too. If you were the "best" candidate for the job, why would you take it? You wouldn't. You'd go work for a company NOT entwined with the gov't.

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Lee Eldridge 4 years, 4 months ago

Gov't needs to get OUT of trying to run business. They oust one guy and pick his replacement, only to oust him after a few months. Gov't and business is like oil and water. They do not mix.

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DarkGhost 4 years, 4 months ago

Their strategy is more arrogance while taking tax payer money. I will never buy a Chevy…ever.

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truman1902 4 years, 4 months ago

Perhaps the commercial blitz featuring now CEO Ed Whitacre promising a 60-day buyback fell short of expectations..60 days is NOT the issue..What mechanical condition will your Chevy Cobalt or Cadillac Escalade once the bumper-to-bumper coverage expires?? For corporate spokesman Howie Long to ridicule Honda for their lawn equipment products, smacks of the 70's when GM was going to smackdown Japanese imports with the Chevy Vega, Citation, Celebrity, S-10 pickup..Need we go on with these former rustbucket junkyard all-stars as past examples?? Chop-blocking your competition with subtle snarky ridicule does NOT address the quality issue, nor does it inspire weary consumers to abandon their imports with 180,000 miles to purchase a Buick which may NOT see 100,000 miles before MAJOR repair costs set in. My Honda may be short on curb appeal, but it will make a dependable daily commute without the assistance of a tow truck..More miles--LESS drama!! BOTTOM LINE!!

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Steve Jacob 4 years, 4 months ago

The government restricting pay will sure hurt the search to find a good replacement. Restricting management pay sounds good on paper, but the best and brightest move on.

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