GM CEO Henderson Resigns After Saab, Saturn Deals Collapse
December 1, 2009 11:45 PM
GM's new CEO Fritz Henderson has called it quits after only 8 months after the job, after deals to sell Saab and Saturn collapsed.
GM will now be headed temporarily by board chairman Ed Whitacre, a former AT&T executive who famously remarked, "I don't know anything about cars."
Fritz Henderson's daughter Sarah reportedly let loose a rant on Facebook after the announcement.
Some believe that Bob Lutz, a current GM vice chairman who has served with all three Detroit automakers will be picked as CEO. Mr. Lutz, a former jet fighter pilot, will take over for Mr. Henderson at tomorrow's LA Auto Show keynote address.
(Source: Detroit News)
GM's recovery hits a roadbump with an executive shakeup, but Whitacre, Lutz seize reins
Late Tuesday news broke that the new CEO of General Motors, Fritz Henderson, was
after only eight months on the job, reportedly by mutual consent. The move took the automotive industry somewhat by surprise as Mr. Henderson had been
personally endorsed by President Obama
and had helped see the automaker
out of bankruptcy
and onto an aggressive path of improved sales and
ahead-of-schedule loan repayments
So what went wrong? Industry insiders in Detroit say that while the previous GM CEO, Rick Wagoner, was given nearly unlimited freedom before the bankruptcy, the government and board essentially strangled Mr. Henderson with too tight a leash.
The board (and U.S. government) became disenchanted with Mr. Henderson as he appointed GM insiders to pivotal executive positions, declining to bring in fresh blood. Mr. Henderson blamed pending government curbs on executive pay. He received more flak over a poorly received ad campaign featuring GM board chairman Ed Whitacre and an abruptly canceled
eBay sales experiment
Most recently the ceiling really caved in when GM's deals to
collapsed. While both GM and the buyer share the blame in both of these failures, GM's inability to provide the buyer with enough resources was reportedly a common complaint between both ex-buyers.
Ed Whitacre, a former AT&T Inc CEO and current GM board chairman, announced Mr. Henderson's departure at a hasty press conference in Detroit. Describes Mr. Whitacre, "Fritz has done a remarkable job leading the company through an unprecedented period of challenge and change. While momentum has been building over the past several months, all involved agree that changes need to be made."
Mr. Whitacre, 68 years old, says that he will serve as GM's interim CEO until a more permanent replacement is found. He refused to answer questions from journalists at his press event, but said that business would continue "as normal" at the automaker. Mr. Whitacre is infamous for his quote, "I don't know anything about cars."
Mr. Henderson's daughter, Sarah Henderson, reportedly released a
after the announcement according to the auto blog site
. The authenticity of Ms. Henderson's comments has not been confirmed.
The job search will likely be complicated by the fact that pay for the position has been restricted by the Obama administration's so-called "compensation czar", Kenneth Feinberg. According to Mr. Whitacre, the government played no direct role in Mr. Henderson's decision to step down.
One possible executive candidate is current
Vice Chairman Bob Lutz
. While certainly an industry insider, Mr. Lutz has spent time at all three Detroit automakers and thus isn't considered old blood. He's known for his vocal and blunt style that has at times run him into trouble, but has also earned him many fans. Mr. Lutz will step in for Mr. Henderson tomorrow at GM's LA Auto Show keynote address. Richard Change, an automotive journalist with
The New York Times
that the signs may point to the selection of "Maximum Bob" as the new GM CEO.
"The Space Elevator will be built about 50 years after everyone stops laughing" -- Sir Arthur C. Clarke
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