GM's Whitacre to stay on as CEO; search dropped
DETROIT (Reuters) - General Motors Co GM.UL Chairman Ed Whitacre said on Monday he would stay on as chief executive indefinitely, ending an eight-week search for his successor in a move intended to bring stability to the automaker's turnaround plans.
The announcement confirmed what many analysts and GM insiders had expected after Whitacre, 68, announced on December 1 that he would take over as acting CEO from Fritz Henderson, who was ousted after eight months on the job.
Whitacre, who steered Texas-based SBC through a series of acquisitions that created AT&T (T.N), became GM chairman in July at the request of the Obama administration as the company emerged from a government-sponsored bankruptcy.
He moved quickly to install a new team of executives to head up GM's troubled North American operations last month when he took over as acting CEO and said that the board had asked him last week to remain in the top job.
"This place needs some stability. I guess that's me," Whitacre told reporters at a hastily arranged news conference at GM's headquarters in downtown Detroit.
Whitacre, a plain-spoken Texan who said he knew nothing about the auto industry when he became chairman and has confessed to getting lost in GM's maze-like headquarters, said the board had not set a term for his tenure.
"As far as I'm concerned, it's for an adequate amount of time to get done what we need to get done, and I can't tell you whether it's three years or two years or what," he said.
Whitacre said he will keep his house in Texas and continue to travel to Detroit. He said he was not sure what he would be paid as CEO and said that would be determined soon.
As a recipient of almost $50 billion in U.S. government aid, GM is subject to caps on executive compensation. Whitacre is now paid $350,000 as GM chairman and a member of the board.
Whitacre becomes the third CEO at the largest U.S. automaker in 10 months.
Analysts said his appointment could bring a steady hand at the top of a company that has lost $88 billion since 2005 and is looking to return to profitability as soon as this year.
"As the public face of the company and one who can basically keep everybody on their toes, it's not a bad short-term decision," said IHS Global Insight analyst Aaron Bragman.
"Long-term, I don't necessarily think that Whitacre is going to be there," Bragman said. "He is already 68 years old and we are seeing people below him who could step up into that top position in two or three years."
SUCCESSOR IN THE WINGS?
Steve Girsky, a former Morgan Stanley analyst who represents the interests of the United Auto Workers union on the GM board, has been serving as an adviser to Whitacre on the intricacies of the auto industry.
GM executives in contact with Whitacre have said his style is to set broad priorities and then to delegate the details to his subordinates, while making it clear that they will be held accountable.
Whitacre has said Chris Liddell, 51, who joined GM as chief financial officer from Microsoft Corp (MSFT.O) this month, is a leading candidate to succeed him.
Mark Reuss, a veteran GM executive and former engineering chief who was named last month to head U.S. operations, is also seen as a contender.
The Obama administration said it supported Whitacre's appointment and that it had no role in the decision.
"We are confident that the board is a good, independent overseer of this company," Ron Bloom, the U.S. Treasury's auto task chief, told reporters on a conference call.
Some questioned whether Whitacre could oversee a sweeping makeover of GM, long the target of criticism for being slow-moving and too inward-looking.
Peter Kaufman, president of the Gordian Group in New York, said Whitacre was "a classic example of big company, old-school management leadership."
The three U.S. automakers -- GM, Ford Motor Co (F.N) and Chrysler Group LLC -- now have chief executives who made their careers outside Detroit.
Alan Mulally, who became Ford's CEO in 2006 after leaving Boeing (BA.N), has reshaped the No. 2 U.S. automaker and steered it clear of a federal bailout.
Chrysler is led by Sergio Marchionne, also the chairman of Fiat SpA (FIA.MI), which took management control as part of the automaker's government-brokered bankruptcy.
- Malaysia Airlines loses contact with plane carrying 239 people |
- Man called Bitcoin's father denies ties, leads LA car chase
- Ukraine standoff intensifies, Russia says sanctions will 'boomerang' |
- Florida mayor fights backyard gun ranges in 'Gunshine State'
- Apple loses bid for U.S. ban on Samsung smartphone sales