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GM Expected to Pay Off U.S. Loans on Wednesday

Aiming to win back right-wing skeptics who’re shunning the automaker.

by on Apr.20, 2010

Why is this man smiling? GM CEO Ed Whitacre may be thinking about paying off government loans, staging an IPO, expanding a key plant -- and winning over bailout skeptics in Washington.

We’ve become an angry nation, and whether it’s health care, gun control, Sarah Palin or Tea Parties, there’s something for everyone to get worked up about.  Like General Motors, which seems to cross the political spectrum when it comes to those angered by the tens of billions of dollars the company received from the federal treasury to keep it afloat last year.

No wonder Chairman and CEO Edward Whitacre Jr. is willing to draw down the struggling automaker’s bank account in a bit to placate critics.  The tall and lanky Texan has already authorized two repayments – for a total of $2 billion — and, reports suggest, Whitacre will have some more news when he visits the GM plant in Fairfax, Kansas, tomorrow.  Several well-placed sources suggest the primary headline will be the complete payback of the $4.7 billion the automaker still owes the government.

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The big question is whether Whitacre will also reveal the answer to an even bigger question: the timing of GM’s planned Initial Public Offering.  There’s little doubt the government would like to have that occur as soon as possible – potentially even before the upcoming election – so it could demonstrate its commitment to recovering the bailout funds that went into GM in the form of equity.  At the moment, the White House oversees a 61% stake in General Motors, though Whitacre has repeatedly insisted that, for the large part he hasn’t had to deal with daily oversight.

Until now, the CEO has been reluctant to set a timetable for an IPO, his new Chief Financial Officer Chris Liddell underscoring the importance of waiting for “the right time.”


Girsky Named General Motors Vice Chairman

Is Lutz being put out to pasture?

by on Feb.22, 2010

Will Stephen Girsky's promotion to Vice Chairman be followed by Bob Lutz's departure?

General Motors has named Stephen J. Girsky its new Vice Chairman of Corporate Strategy and Business Development, a move that coincides with yet another round of changes in the automaker’s corporate suite — and it is triggering debate – once again – over the future of GM’s long-time product chief, Bob Lutz, who turned 78 this month.

Girsky, a former Wall Street analyst has been serving a variety of rolls at GM since joining the company on July 10, 2009, as it emerged from bankruptcy.  He initially joined the automaker’s board of directors as the representative for the United Auto Workers Union, which took a major stake in GM as it emerged from Chapter 11.

But on December 1, following the ouster of former Chief Executive Officer Fritz Henderson, Girsky became a special adviser to Edward Whitacre, as he added CEO to his initial title of non-executive Chairman.

In recent months, Whitacre has acknowledged his heavy reliance on Girsky, a former Morgan Stanley analyst, to sort through some of the basics of the car business, which Whitacre, the former CEO of AT&T, admits he doesn’t fully understand.

“Steve brings a depth of experience to this position that will serve the company well as we continue with our restructuring efforts,” said Whitacre, following Girsky’s appointment to the Vice Chairman’s post. “He is a trusted adviser who has made a major contribution through the company’s transition. We look forward to benefiting from Steve’s counsel and insights as we move the company forward.”

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A frequent critic of GM during his years on Wall Street, Girsky has generated good marks from those who have worked with him, over the years, including Joe Phillippi, former auto analyst with Lehman Brothers and now head of the consulting firm, AutoTrends.

“He’s obviously got a lot of background in the auto industry,” said Phillippi.  “And Ed (Whitacre) feels he needs a good sounding board and an outside voice.”


GM Looking to be Back in the Black in 2010, Says Whitacre

Automaker also expects to rehire “hundreds” of dealers.

by on Jan.06, 2010

GM will be back in the black, this year, if "Big Ed" Whitacre has anything to say about it.Just a year after going through its bankruptcy reorganization, General Motors expects to be back in the black for 2010, or so forecast the carmaker’s chairman. But Ed Whitacre, who is also serving as GM’s acting CEO conceded, “there are some obstacles that could get in the way.”

In his second “media roundtable” since taking on the chief executive’s duties at the end of November, a surprisingly candid Whitacre also acknowledged GM “probably made some mistakes” when it dropped more than 1000 dealers as part of its bankruptcy reorganization.  And, as a result, it will likely bring back “hundreds,” he added, through a new, Congressionally-mandated arbitration program.

“It was not a perfect process,” said Whitacre, a former chairman of AT&T.  As a result, some good dealers may have been cut and, he added, they will “be good” to get back into the General Motors retail network.  But Whitacre also expressed concern that GM not be forced to take back “a lousy dealer…arbitrarily.”

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During an hour-long session, GM’s new boss covered a wide range of topics including the search for a permanent CEO, a slot left in limbo by the firing, on November 30th, of former Chief Executive Fritz Henderson.  An outside search firm has been overseeing the process and Whitacre said he expects it to brief the GM Board of Directors soon, though he declined to say when a candidate might be selected.


Q&A General Motors CEO Ed Whitacre

Yes, yes and no. Taciturn Whitacre keeps it short and sweet.

by on Dec.08, 2009

GM Chairman Ed Whitacre, Jr. keeps things short and simple during his first meeting with the media.

GM Chairman Ed Whitacre, Jr. keeps things short and simple during his first media meeting.

Though he insists he likes cars, Ed Whitacre, Jr. is not your classic “car guy,” which to some is a good thing.  Trained as a telecommunications engineer, the 68-year-old Texan rose to the top at SBC, one of the smaller “Baby Bells” spun off after the break-up of AT&T, eventually staging the highly unlikely takeover of SBC’s one-time parent.

Equally unlikely was the call Whitaker got from the White House task force.  A one-time top fundraiser for former President George W. Bush, Whitaker was named head of the newly-reconstituted Board of Directors following General Motors’ July 10 re-emergence from bankruptcy.

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Whitaker has little patience for those who don’t deliver, according to those who know him, something he demonstrated, a week ago, when he led the ouster of GM’s popular CEO Fritz Henderson.  For the time being, at least, Whitaker is serving as Acting CEO while a search begins for Henderson’s replacement.

In his first interaction with the media since the GM shake-up, Whitaker today held a brief, 38-minute webchat with journalists, a digital conversation that underscored his way of keeping things short and simple – if not always providing the necessary details or allowing follow up queries for clarification.  Here’s a transcript of the conversation: