Just a day after the federal government ended its ownership stake in the post-bankruptcy General Motors, the automaker has announced a sweeping change in its management lineup.
That includes the retirement of Chairman and Chief Executive Dan Akerson, with Mary Barra taking his place as CEO on January 15, 2014.
The well-respected Barra, currently GM's global product development czar, will become the first woman to serve as the chief executive officer of any major auto manufacturer in the world.
Her new second-in-command will be Dan Ammann, a New Zealand native who signed on as GM chief financial officer after assisting the maker through its 2009 bankruptcy.
"I will leave with great satisfaction in what we have accomplished, great optimism over what is ahead and great pride that we are restoring General Motors as America's standard bearer in the global auto industry," Akerson said in a message to the maker's 85,500 employees.
Akerson himself joined GM following its run through Chapter 11, a process it exited only with the help of a $49.5 billion federal bailout. The Treasury Deparment has been selling down its stake since GM's November 2011 IPO, the last of the government's shares going on the block yesterday. Akerson took on both chairman and CEO duties in 2010 following the departure of Ed Whitacre. Both men had backgrounds in the telecomm industry.
And that raised concerns for many observers who worried that GM needed to have a top executive who actually understood the automotive industry.
"The big news to me is that they've handed the CEO position back to someone who knows the business," said David Cole, chairman emeritus of the Center for Automotive Research, in Ann Arbor, Michigan. "That's really important. It's not that Akerson did a bad job, but he never really understood the complexity of the business."
At 51, Barra has been a GM and auto industry lifer, working her way up through a string of positions over 33 years, serving most recently as the overseer of GM's product portfolio. She was, in fact, the automaker's first-ever woman "car czar," responsible for the design, engineering, program management — and, critically, quality improvement efforts — for GM's 11 worldwide brands.
It's a critical post, considering the increasing global competition. For GM, the good news is that its products have been generating strong praise in recent years. Consumer Reports recently named the Chevrolet Impala the best sedan it has ever tested. The Cadillac ATS was named North American Car of the Year in January 2013, and five of GM's new 2014 products made the "short list" for the 2014 North American Car and Truck of the Year shoot-out. Significantly, GM's product quality has also been on the rise, according to various third-party surveys that include the latest J.D. Power Initial Quality Survey.
"With an amazing portfolio of cars and trucks and the strongest financial performance in our recent history, this is an exciting time at today's GM," said Barra. "I'm honored to lead the best team in the business and to keep our momentum at full speed."
Barra was recently named as the most powerful woman among automotive executives by Fortune magazine. She has won praise not only for her knowledge of the business but also for her management style, which reflects that of the widely praised Ford CEO Alan Mulally. The industry, said analyst Cole, needs a more "feminine" style that is more of a coach than a traditional top-down executive.
Barra will have a strong team to lead, including the 41-year-old Ammann, who joined the company in 2010 and led the development of the maker's critical November 2011 IPO. He will serve in the dual role as president and CFO until "at least" next April, according to GM, though a search for a replacement is now underway.
That process could become a bit easier as one of the strictures of government ownership was that pay for GM's top executives had to be approved by a federal overseer — something CEO Akerson contended made it difficult to recruit many potential top managers.
Akerson was expected to depart in the next year or so, but revealed his retirement came earlier than initially planned following his wife's diagnosis of suffering from an advanced stage of cancer.
His role as chairman will be filled by the 66-year-old Theodore "Tim" Solso, the 66-year-old former chairman and CEO of automotive supplier Cummins, Inc., and a GM board member since June 2012.
GM also announced that Vice Chairman Steve Girsky, a long-time Wall Street investment analyst who recently crafted the maker's European turnaround plan, will leave the company next April but remain an advisor and board member.
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If the american auto industry is to succeed it needs to bring back that consumer loyalty. That two way street loyalty that used to lead to arguements at summer barbeques over which was better, Chevy/Ford/GMC/Dodge. Now no one really has any brand loyalty anymore, especially since the brands themselves could care less about their customers.
I don't like the idea of government bail-outs, of private corporations, anymore than anyone else.
However, if the government did not bailout GM that would have meant that 85,500 GM employees plus countless thousands of others, who work for GM suppliers, would have been out of a job. What effect would that have had on our already poor economy? In retrospect I think that the 10.5 billion dollar loss was worth it. Even though I don't drive an American made car American auto manufacturers are a very large part of the US economy and I wish Ms. Barra the best of luck.