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GM Readying Another Major Reorganization

Insiders brace but many hope for the best.

by on Aug.22, 2012

GM CEO Akerson tis expected to soon launch a major corporate reorganization.

General Motors appears to be heading towards a major reorganization, numerous sources indicate, one that Chairman and CEO Dan Akerson apparently hopes will shift the maker to a more global focus – and help it eliminate the sort of “fiefdoms” that have long stymied its efforts to become more efficient and competitive.

GM has been taking a number of baby steps towards this new vision in recent months, such as a realignment of its design operations meant to focus more on individual brands than specific global regions.  But the strategy has also suffered some unexpected setbacks, notably including the sudden ouster of worldwide marketing chief Joel Ewanick last month.

A reorganization could yield huge benefits if it results in a leaner and more efficient GM.  And CEO Akerson is clearly under pressure to improve things at a company that suffered a major drop in earnings during the second quarter – and which has seen its stock drop by as much as 40% since its November 2010 IPO.

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On the other hand, some observers caution that after years of turmoil, capped by the maker’s 2009 bankruptcy and subsequent federal bailout, GM’s leaders could trip the company into chaos if they’re not careful. The massive and largely dysfunctional 1984 reorganization is a clear example of what could go wrong.


GM Reorganizes Its Thriving South American Ops

General Motors South America will have its headquarters in Sao Paulo, Brazil, GM’s third largest national market.

by on Jun.22, 2010

Vista aérea do Complexo Industrial de São José dos Campos

Brazil and Mexico could be a source of fuel efficient vehicles for Canada and the U.S.

General Motors Company announced today that it is creating a new regional organization “to meet rising customer demand” in South America by splitting it off from the existing International Operations division.

GM South America will be headquartered in Sao Paulo, Brazil and will be led by Jaime Ardila, currently president and general manager of GM Mercosur.

Ardila becomes president, GM South America and will report directly to GM Chairman and CEO Ed Whitacre. As a member of the Executive Committee and regional president, Ardila becomes the highest-ranking Hispanic in the company.

GM’s largest national market is the United States (arguably if you exclude required joint ventures in China), followed by China, Brazil, Germany, the United Kingdom, Canada, and Italy.


GM has a long history in the area. It opened its first factory in Argentina in 1925., and has since invested billions of dollars in the region, which recently includes a new assembly plant in San Luis Potosi, Mexico, as well as a design center in Sao Jose dos Campos, Brazil.

Leaving UAW politics aside, the region could become a source of low-cost, fuel-efficient vehicles for the U.S. and Canada.   (more…)

Lutz Isn’t Leaving

But he’s not going to just be GM’s mascot, vice chairman says.

by on Dec.17, 2009

"Why stop?" askes 77-year-old Bob Lutz, who has signed on for another stint with General Motors, this time running the automaker's marketing operations.  But he cautions he has just six months to prove he's up to that task.

Unless the Board shows him the door - or his health fails, Lutz has no plans to retire soon. Just don't call the 77-year old GM's mascot.

Reports of Bob Lutz’s demise have been greatly exaggerated.  Just ask the septuagenarian General Motors vice chairman.

It’s been a chaotic month at GM, with a CEO fired, a new Buick boss quitting after just eight days, and enough other personnel changes to require a scorecard to keep up.  When Vice Chairman Bob Lutz was stripped of his duties as marketing czar, two weeks ago, many observers were ready to bet that the former Marine pilot would be the next out the door.

They would have bet wrong, said Lutz, who turned out for a Wednesday night preview of new Chevrolet products.

“I’m happy as a clam,” the 77-year-old Swiss-born Lutz proclaimed while leaning against the next-generation Chevy Malibu.

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“If left to me, as long as I have the energy, as long as I have my health, as long as I have my the drive and ability to contribute,” he asserted, “I’ll stay.  If not, I’ll retire.”  Of course, Lutz quickly added, “I serve at the will of the Board,” and, in particular, the will of GM’s determined new Chairman and Acting CEO Ed Whitacre, Jr.


Is 13 a Lucky Number for GM’s Board?

With a lot of help from the U.S. Treasury, General Motors Company has a new governance structure.

by on Jul.23, 2009

Over to you Fritz, if the government actually lets you run the company.

Over to you Fritz, if the government actually lets you run the company.

The reorganization of General Motors finally caught up with the speed of its bankruptcy sale two weeks ago when the final appointments to its U.S. Government  vetted  Board of Directors  were announced this afternoon and most its new executive committee were  named.

The Executive committee will run the recovering company, and it replaces two previous boards, the Automotive Strategy Board and Automotive Product Board. Led by GM Company CEO Fritz Henderson, executive committee membership includes:

  • Bob Lutz, vice chairman, marketing and communications;
  • Tom Stephens, vice chairman, global product development;
  • Nick Reilly, executive vice president, GM International Operations;
  • Ray Young, executive vice president, chief financial officer;
  • Tim Lee, group vice president, global manufacturing and labor relations;
  • John Smith, group vice president, corporate planning and alliances, and secretary of the executive committee;
  • Mark LaNeve, vice president, U.S. sales;
  • Bob Socia, vice president, global purchasing and supply chain.
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“With these announcements, most of the new GM leadership team is in place,” Henderson said in a statement. “We expect to have the final round of announcements next week.”

At least six senior executives are retiring including Jonathan Browning, Troy Clarke, Gary Cowger, Michael Grimaldi, Maureen Kempston Darkes and Ralph Szygenda. More retirements are expected as the  company continues to pare its bloated executive ranks.

As Henderson previously noted, when announcing that senior management ranks would be trimmed by 35%, by year’s end, “We have a lot of good executives.  We just have too many of them.”