Akerson was no fan of GM, model lineup when he joined board, Whitacre says in book
Former CEO says automaker still has fat to cut
"I felt like a traitor," former GM chairman and CEO Ed Whitacre says in a forthcoming memoir about his relatively short tenure with the automaker. "But I also knew that it wasn't right for me to stay another two or three years."
DETROIT -- General Motors CEO Dan Akerson was not a fan of GM's model lineup and thought the automaker was one of the most poorly managed companies when he became a director in 2009, his predecessor, Ed Whitacre, says in a new book.
Whitacre, 70, who served as chairman of AT&T before becoming GM chairman in the summer of 2009, also blames many of GM's woes prior to its 2009 bankruptcy and restructuring on management.
And Whitacre, who replaced nearly all of the top executives at the company during his tenure, says GM still has a lot of fat that needs to be cut.
Whitacre discloses the details about GM's operations during his nine months as CEO of the company in a memoir, "American Turnaround: Reinventing AT&T and GM and the Way We Do Business in the USA."
A manuscript of the book was obtained by The Detroit News, which published details on Saturday. The book is scheduled to be published Feb. 5, the News said.
The book provides new details about the succession of GM CEOs, the News reported.
Whitacre says he stepped down in August 2010 because he couldn't commit to staying at least two years after GM's initial public stock offering.
During a board meeting, Akerson, a board member and partner at Carlyle Group, a private equity firm, "basically volunteered to do the job," Whitacre says in the book.
"Dan was pretty vocal during the executive session," Whitacre says. "Said he thought GM was one of the worst companies he'd come across in his entire life. And he was not a fan of GM cars -- he made that crystal clear."
Whitacre was appointed chairman of GM by the Obama administration in July 2009 when it exited bankruptcy under a government bailout. He became CEO in December 2009 after GM's board removed Fritz Henderson.
At Whitacre's first meeting as GM chairman, the board gave Henderson, who had been handed the reins in late March, 90 days to prove himself, according to the book.
Whitacre says in the book he was disappointed with Henderson's tenure at the top, the News said.
"After five months on the job, not much had happened. A tweak here, a tweak there -- that was pretty much it," Whitacre writes.
Before GM directors decided to dismiss Henderson, the board hired a search firm to find a new CEO, the News said.
At a December 2009 meeting, the board agreed unanimously to fire Henderson.
"Does anyone want the job?," Whitacre asked the board. He said there was silence. "Akerson, one of GM's most consistent critics throughout this entire period, sat silent. So did every other director."
The board never interviewed any candidates -- though the search firm talked to a few privately, the News reported, citing the book.
The News said Henderson declined to comment, saying he hasn't read the book.
HQ move thwarted
Whitacre said in the book he also scrapped a plan to relocate the bulk of GM's headquarters staff out of downtown Detroit's Renaissance Center to the company's technical center in suburban Detroit.
Whitacre said GM's board was never informed of the plan, which would have cost $100 million or more to implement, the News said, citing the book. "The whole thing was nuts. I shut it down. With one phone call, I basically wiped out months of planning."
In April 2009, GM considered moving its entire corporate headquarters out of Detroit, but the Obama administration overruled the plan.
GM declined to comment on the book, the News said.
Whitacre says in the book that GM nearly went out of business because of bad management.
"The economy didn't do that to GM. The union didn't do that to GM. And the Japanese yen certainly didn't do that to GM — GM's management did that to GM," he writes in his forthcoming memoir. "They just never had the smarts or the guts or whatever you want to call it to make a course correction to give GM a shot at a better future."
After he became CEO in December 2009, Whitacre says in the book that he spent an hour talking to one very senior executive who tried to "explain to me what he did at GM.
"And the more he talked, the more nebulous his job sounded. By the time he finished, I came away feeling that this guy really didn't have anything to do," Whitacre writes in the book, according to the News. "Most troubling to me, none of this seemed to bother him, or even occur to him."
Whitacre says in the book that he strived to simplify GM operations, eliminate consultants and scrapped lengthy PowerPoint presentations in favor of oral presentations no more than 10 minutes at board meetings.
In other moves described in the book, the News said Whitacre discloses:
GM had delayed approving $400 million for a new Ecotec engine as directors asked questions month after month. Whitacre says he decided to authorize the program in early 2010 rather than bring the team back for another board meeting.
Whitacre says he spent 10 minutes hearing a presentation before approving a $100 million venture capital fund for GM to invest in promising technologies.
In another meeting, Whitacre -- who stands 6 feet, 4 inches tall -- asked engineers to add more leg room to the back seat of pickup trucks. They eventually found a way to squeeze out a few more inches after initially saying it wasn't possible.
The News said Whitacre writes he is still ambivalent about his decision to leave GM more than two years ago, and rejected a request from President Obama to stay on the job longer.
Whitacre discloses that on his way to an annual auto conference in Traverse City, Mich., in August 2010, he decided to resign.
"I felt like a traitor," he says in the book. "But I also knew that it wasn't right for me to stay another two or three years."
Whitacre also writes the company had forgotten about its most important asset.
GM became the world's largest automaker "because of the people it had working there — they had guts, good ideas and a lot of talent," Whitacre says in the book, according to the News.
"Somewhere along the line, it seemed to me, GM employees forgot how special they are … and how important they are, and always will be, to the success of the company."
Last month, Whitacre called on the U.S. government to sell all of its remaining stake in GM as quickly as possible.
In an opinion piece published in The Wall Street Journal, Whitacre called the Treasury Department's holding a "distraction" for the company, which exited U.S.-funded bankruptcy protection more than three years ago.
The Treasury still owns about 26.5 percent of GM's shares.