Toronto Star
Ed Whitacre doesn't know his way around Detroit.
Literally.
Since U.S. President Barack Obama tapped the impatient Texan as chairman of a crippled General Motors Co. last year – an entreaty Whitacre initially turned down, having just retired from a 17-year career as CEO of telecom giant AT&T Corp. – Whitacre has had to learn the pronunciation of main streets like Gratiot Ave. (it's "Grashet") and ask directions within the Renaissance Center (RenCen), the ominous-looking cluster of silo towers on Detroit's waterfront that GM calls home.
Literally.
Since U.S. President Barack Obama tapped the impatient Texan as chairman of a crippled General Motors Co. last year – an entreaty Whitacre initially turned down, having just retired from a 17-year career as CEO of telecom giant AT&T Corp. – Whitacre has had to learn the pronunciation of main streets like Gratiot Ave. (it's "Grashet") and ask directions within the Renaissance Center (RenCen), the ominous-looking cluster of silo towers on Detroit's waterfront that GM calls home.
The spirit of GM lifers was not lifted by the arrival of Whitacre, a carpetbagger from San Antonio, who promptly made the wrong kind of headlines by saying, almost defiantly, "I don't know anything about cars. A business is a business, and I think I can learn about cars. I'm not that old (he's 67), and I think the business principles are the same."
Whitacre, whose board appointed him CEO on Monday, seemed not to appreciate that in Detroit, perhaps even more than Toyota City, Stuttgart and Wolfsburg, "car guys" are revered. As of Monday, and for the first time in its history as one of the world's oldest and biggest automaking jurisdictions, Detroit's auto sector is now run entirely by outsiders to the industry and to Michigan.
Then again, it was the veteran "car guys" who presided over the decades-long decline of Detroit, culminating in last year's bankruptcy of Chrysler Group LLC and GM, which as recently as the 1980s could boast a North American market share of about 50 per cent. Among the Detroit Three, that fate was avoided only by Ford Motor Co., run since 2006 by outsider Alan Mulally, a recruit from Boeing Co.
GM can only wish it had benefited from a CEO track record to match that of Whitacre, son of a locomotive engineer who transformed Southwestern Bell, the smallest of the so-called Baby Bells created in the 1980s with the breakup of AT&T, into an industry consolidator with a market value of $244 billion (U.S.) when Whitacre retired in 2007.
From the start last summer, a hard-charging Whitacre did not act like a typical overseer chairman. By December, the Whitacre-led GM board had ousted Fritz Henderson, the GM-lifer who had replaced Rick Wagoner, himself ousted earlier in the year by Obama's auto-industry task force. Whitacre had reversed Henderson's plan to sell GM Europe, a huge operation anchored by Adam Opel GmbH, to a consortium led by Aurora-based Magna International Inc.
There was little in Whitacre's GM tenure to suggest he was much interested in replacing Henderson with anyone but himself. Too many of GM's major decisions were being made by its chairman and not its CEO for Monday's outcome to be much of a surprise.
Indeed, Whitacre had become so much larger-than-life a figure at GM that it was difficult to imagine GM finding a replacement for Henderson willing to work with a chairman so given to second-guessing his ostensible CEO.
Having stymied Frank Stronach's ambitions at Opel, Whitacre then paid off Opel's loans to Germany ahead of schedule. He has vowed to make GM profitable in 2010, also ahead of schedule; to pay back $6.7 billion (U.S.) in loans to Uncle Sam; and take GM public again as early as this year so taxpayers can cash out and GM can shed its "Government Motors" stigma.
Whitacre has greenlighted increased production at Oshawa, one of GM's crown jewels. And he bought out joint-venture partner Suzuki Motor Corp.'s half-interest in the CAMI facility in Ingersoll, Ont. He's also pushing GM engineers to move up the debut of what GM hopes will be a game-changing electric-drive Chevy Volt to late September from later in the year.
What GM has long needed, and now has in Whitacre, is a take-no-prisoners CEO who will display the heads of executives who fail to meet profit goals on pikes outside RenCen. If GM is to have a future, its history of over-promising and under-delivering on everything from market share to quality improvements must be relegated to the past. Judging from his brief but eventful tenure at GM so far, the Whitacre sense of urgency is GM's best shot at restoring the firm's intimidating leadership role of the 1950s, when friend and foe alike bowed to "The General."
Whitacre, whose board appointed him CEO on Monday, seemed not to appreciate that in Detroit, perhaps even more than Toyota City, Stuttgart and Wolfsburg, "car guys" are revered. As of Monday, and for the first time in its history as one of the world's oldest and biggest automaking jurisdictions, Detroit's auto sector is now run entirely by outsiders to the industry and to Michigan.
Then again, it was the veteran "car guys" who presided over the decades-long decline of Detroit, culminating in last year's bankruptcy of Chrysler Group LLC and GM, which as recently as the 1980s could boast a North American market share of about 50 per cent. Among the Detroit Three, that fate was avoided only by Ford Motor Co., run since 2006 by outsider Alan Mulally, a recruit from Boeing Co.
GM can only wish it had benefited from a CEO track record to match that of Whitacre, son of a locomotive engineer who transformed Southwestern Bell, the smallest of the so-called Baby Bells created in the 1980s with the breakup of AT&T, into an industry consolidator with a market value of $244 billion (U.S.) when Whitacre retired in 2007.
From the start last summer, a hard-charging Whitacre did not act like a typical overseer chairman. By December, the Whitacre-led GM board had ousted Fritz Henderson, the GM-lifer who had replaced Rick Wagoner, himself ousted earlier in the year by Obama's auto-industry task force. Whitacre had reversed Henderson's plan to sell GM Europe, a huge operation anchored by Adam Opel GmbH, to a consortium led by Aurora-based Magna International Inc.
There was little in Whitacre's GM tenure to suggest he was much interested in replacing Henderson with anyone but himself. Too many of GM's major decisions were being made by its chairman and not its CEO for Monday's outcome to be much of a surprise.
Indeed, Whitacre had become so much larger-than-life a figure at GM that it was difficult to imagine GM finding a replacement for Henderson willing to work with a chairman so given to second-guessing his ostensible CEO.
Having stymied Frank Stronach's ambitions at Opel, Whitacre then paid off Opel's loans to Germany ahead of schedule. He has vowed to make GM profitable in 2010, also ahead of schedule; to pay back $6.7 billion (U.S.) in loans to Uncle Sam; and take GM public again as early as this year so taxpayers can cash out and GM can shed its "Government Motors" stigma.
Whitacre has greenlighted increased production at Oshawa, one of GM's crown jewels. And he bought out joint-venture partner Suzuki Motor Corp.'s half-interest in the CAMI facility in Ingersoll, Ont. He's also pushing GM engineers to move up the debut of what GM hopes will be a game-changing electric-drive Chevy Volt to late September from later in the year.
What GM has long needed, and now has in Whitacre, is a take-no-prisoners CEO who will display the heads of executives who fail to meet profit goals on pikes outside RenCen. If GM is to have a future, its history of over-promising and under-delivering on everything from market share to quality improvements must be relegated to the past. Judging from his brief but eventful tenure at GM so far, the Whitacre sense of urgency is GM's best shot at restoring the firm's intimidating leadership role of the 1950s, when friend and foe alike bowed to "The General."
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