GM’s Decapitated Leadership Creates Waves of Unrest

A lot has been happening with the General.  The blogosphere went into a hoot over Frederick “Fritz” Henderson’s resignation as CEO,as the move was unexpected even by his colleagues.  As Vice-Chair Bob Lutz put it, “None of us had any hint this was coming.”  Ed Whitacre, GM’s board chair, will step in temporarily to fill the CEO slot.

Henderson’s departure comes as GM continues to suffer heavy losses, as well as some very public embarrassments.  The Opel, Saturn, and Saab deals all fell through, with European trade and treasury officials publicly questioning GM’s competence.   Opel’s CFO, Marco Molinari, quit the exhausted German subsidiary just yesterday.  (Not an inspiring sign.)

Mike Jackson, head of the largest US auto retailer, was open about his fears in an interview with Automotive News: “I’m concerned because I think Ed [Whitacre] and Fritz made a great team of complementary talents and I think Fritz’s expertise will be missed.  And, since everyone agrees the core business of GM was on a very good path, you have to ask the question, why are they doing this?”

Others were not so forgiving.  ”Both the plan and the resignation of GM chief Henderson confirm that there is no clear line at GM,” said German economy minister Rainer Bruederle.

David Kiley of Popular Mechanics offered his analysis on why Henderson left: “Henderson did not see eye-to-eye with chairman Ed Whitacre, who was brought in by the White House after Henderson was given the job: Henderson was keen to sell off the company’s Opel division in Europe, a move the board reversed. He led the selection of ‘preferred buyers’ for Saab and Saturn only to have both deals fall apart because the would-be buyers backed out of the deals at the 11th hour. Henderson pushed back on replacing chief financial officer, Ray Young. And Whitacre looked at how much GM had budgeted for marketing, deemed it insufficient to compete against rivals Ford and Toyota, and boosted the funds by some $500 million.”