Former CEO Ed Whitacre is bullish on GM—and America
Ed Whitacre, the former CEO of General Motors and AT&T, declared the future of GM “very strong” during a wide-ranging interview about the auto industry and American business.
“I think the future of GM is very strong,” said Whitacre, who served as CEO of the automaker from December 2009 to September 2010. He noted GM’s (GM) healthy performance in China, where the Buick brand is a top seller, and had encouraging words about GM’s Europe brands, Vauxhall and Opel. “Do I think Europe can be fixed in the face of the economy? Yes, I do.”
Whitacre spoke at an event at the Cornell Club in support of his recently published memoir, “American Turnaround: Reinventing AT&T and GM and the Way We Do Business in the USA.” He served as CEO of AT&T (T) and its predecessor companies from 1990 to 2007. He came out of retirement in 2009 to become chairman of GM, which had just filed for bankruptcy. Steven Rattner, the investment banker tapped by the Obama administration to oversee the federal bailout of GM, recruited Whitacre. Whitacre told the audience that he was motivated by one of Rattner’s remarks: “Steve said, ‘Ed, this will be a public service for the country.”
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Whitacre acknowledged that the car manufacturer still has work to do. “I didn’t say I fixed all the problems at GM,” he said. “There’s still bureaucracy there. There are margin problems.”
The 71-year-old executive said he is optimistic about American manufacturing. Plants have become more automated and more sophisticated, but that as manufacturing becomes more technical that the work becomes more interesting for employees. Many of his comments during the one-hour conversation focused on empowering employees and tearing down layers of management that inhibit decision-making. “Bureaucracy builds up when people don’t have enough to do,” he said.
Despite his success at GM—the company exited bankruptcy and raised $20.1 billion in an initial public offering in 2010—Whitacre expressed some ambivalence about his departure from the company. (He handed the reins to current CEO Dan Akerson, another one-time telecom CEO.) “After the IPO the company was going to need someone to run it who had a lot more runway…somebody who could stay in the saddle for several years. I decided the best thing for GM was for me to get out of there,” he said. “Was I torn about it? I still am today.”
He also jokingly confessed that he was reluctant to turn in his resignation letter to a key figure in the GM bailout: President Obama. Whitacre quipped: “I was afraid to tell him.”