Environment Forum

Lost in Detroit?

December 15, 2009
Ed Whitacre on July 10, his first official day as chairman of GM.

Ed Whitacre on July 10, his first official day as chairman of GM.

     For the past two weeks, GM Chairman and Chief Executive Ed Whitacre has been confined to the glass towers that house the automaker’s downtown Detroit headquarters and an adjoining hotel.

Living out of suitcases, he says he ran out of dress shirts last week and turned up at a GM assembly plant in Flint wearing jeans and a sweatshirt.

An outsider in a company long dominated by insiders, Whitacre admits to having lost his way in the signature round corridors of GM’s headquarters and being forced to ask security guards for directions.

 That’s not the only jarring change from a life of mostly quiet retirement in San Antonio, Texas, for the former AT&T chief who resisted the Obama administration’s initial call to become involved in GM this summer.

 Now, as GM CEO, he faces long hours for a high-profile job with no set salary.

 ”It’s like 14 hours a day, five-and-a-half or six days a week. When I think I can escape for a weekend, my phone rings constantly. It’s full time,” Whitacre said Tuesday during his first question-and-answer session with reporters.

 He became GM CEO on December 1 when the board he leads called for the departure of former Chief Executive Fritz Henderson and went right to work.

 Whitacre has appointed a new team of top managers that meet every

Monday, charged GM veteran Mark Reuss with recapturing sales momentum in the U.S. market and set a new and simpler mission statement for the automaker.

 ”It’s ‘to design, build and sell the world’s best vehicles’,” Whitacre said. “What was it before? I don’t know but it was a lot longer and more complicated. It has to be simple for me to understand it. I’m not a car guy.”

 When former U.S. autos task force chief Steve Rattner called Whitacre to ask him to become GM chairman this summer, Whitacre said he declined. But the follow-up call the following day closed the deal and played on his conscience, he said. 

“I had a pretty good life. Things were OK. It hit me cold,” Whitacre said of the call from the Obama administration. “But I got a call the following day and they said, we think you’d be a great choice. The company needs you. You’ve run a big company. America needs this company.”

 The Obama administration also needs to show a return on the more than $50 billion extended to GM.

 ”The U.S. government bought the equity in this company, so they are obviously looking for return on that equity like any shareholder would be looking for it. And that’s what this company intends to deliver. That’s what Capitalism is about,” Whitacre said.

 GM’s 101-year-old corporate culture has been criticized as insular, slow-moving and overly obsessed with data. The stars were executives on the elite track like Henderson, who made a show of speaking Portuguese and once boasted of his speed in making PowerPoint presentations.

 The contrast with Whitacre’s plain-spoken common sense is complete. His goal for GM? “The first thing we have to do is to sell more cars,” he says. 

As CEO, Whitacre may have months ahead to hold his new managers to that simple but elusive goal. Whitacre shows no sign that the unexpected trip that took him to Detroit and GM will end anytime soon.
   

With GM on track to pay off its loans to the U.S. Treasury by June, Whitacre seems set to stay on until then. By staying on as acting CEO at least through the first half, Whitacre also could have a freer hand in setting a salary for his replacement since U.S.-government imposed pay restrictions could ease.
   

In the meantime, Whitacre says he is looking for something more permanent than his GM-adjacent hotel room.
   

“I’m going to find a condominium or an apartment or something,” he told reporters.

 

Blog post by Kevin Krolicki, Detroit Bureau Chief.

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