GM names Barra as CEO, succeeding Akerson

December 10, 2013 12:00 AM

From staff, wire reports

GM

GM CEO Dan Akerson announces his departure today during a town hall meeting with employees at the GM global headquarters in Detroit. To his left: Mary Barra, Dan Ammann and Mark Reuss.

Q&A with incoming GM CEO Mary Barra

Source: General Motors

General Motors has named product development chief Mary Barra to succeed Dan Akerson as CEO, making her the first female CEO of a global automaker.

Dan Ammann, 41, executive vice president and CFO, was named president and will assume responsibility for managing the company’s regional operations around the world, GM said today. The global Chevrolet and Cadillac brand organizations and GM Financial will also report to Ammann.

Akerson, 65, said he pulled ahead his succession plan by several months after his wife was diagnosed with an advanced stage of cancer about two months ago. His retirement -- and several other top executive moves -- will be effective Jan. 15, GM said.

"It was not my intention for my days at General Motors to end this way," he told reporters during a conference call. "But I think, when you think about life’s priorities, my family and my wife rank No. 1."

Akerson said his original time table for stepping down was sometime in the second half of 2014. He said the board already had extensively vetted the internal candidates, but chose not to conduct an outside search.

Mark Reuss, 50, executive vice president and president, North America, will replace Barra, 51, as executive vice president of global product development, purchasing and supply chain. The board also named director Theodore (Tim) Solso to succeed Akerson as chairman. Solso, 66, is the former chairman and CEO of Cummins, Inc., and has been a member of the GM board since June 2012.

Alan Batey, 50, now head of global Chevrolet and U.S. sales, will replace Reuss as executive vice president of GM North America.

Vice Chairman Steve Girsky, 51, head of corporate strategy and business development, will move to an advisory role before leaving the company in April, GM said. He will remain on the company's board of directors.

GM said it will name a new CFO to replace Ammann at a later date.

'They're fine with it'

Akerson said each executive who was broadly viewed as in the running for the CEO job -- Reuss, Ammann and Girsky -- has embraced the changes.

"I walked every one of the executives through their new assignments and, uniformally, they said, 'Man, this is the best choice,'" he said. "They’re fine with it."

Barra, who also will be joining the GM board, started her career on a factory floor as an intern more than 30 years ago. She has been in charge of product development and quality of all GM cars and trucks for 22 months, fostering collaboration and wringing costs out of the supply chain.

The daughter of a Pontiac die maker takes the helm after the U.S. government sold its stake in GM, giving her full freedom to take on domestic and Japanese manufacturers whose price competition threatens profit.

Akerson called Barra "eminently qualified," personable and held in high regard throughout the company.

"She grew up in the company, worked on the factory floor, managed plants, and then managed the largest, most complex segment of our business, global product development," he said. While overseeing GM’s product development over the last three years, Barra "brought order and started to fundamentally transform" the process, Akerson said.

Bob Lutz, who served as GM’s product chief from 2001 to 2009, told Automotive News that Barra gets credit for leading the globalization of GM’s manufacturing footprint while she was head of global manufacturing-engineering during much of that time.

"She was the key implementer of the global manufacturing strategy," said Lutz, who called Barra smooth and poised.

"That was a major achievement and saved a lot of money."

Top women

As the first female CEO of a global automaker, Barra joins Ginni Rometty at IBM Corp., Indra Nooyi at PepsiCo Inc., Marissa Mayer at Yahoo! Inc., Hewlett-Packard Co.’s Meg Whitman and Ursula Burns of Xerox Corp. as women who have risen to run major U.S. corporations.

Barra began with GM in 1980 as a student at General Motors Institute (since renamed Kettering University) in Flint, Mich., and landed her first job as a plant engineer at Pontiac Motor Division, where her father worked for 39 years. There were few women and even fewer 18-year-olds.

“It was a rougher environment,” she said in an interview with Bloomberg in March. “It makes you harder.”

Her big break came when GM put her in a program for high-potential workers and gave her a scholarship to get an MBA from the Stanford Graduate School of Business. She became an executive assistant for then-CEO Jack Smith, a perch that gave her a window into how the company worked. She recalls visiting senior leaders at GM to talk about diversity and women’s issues while she was pregnant.

“I will leave with great satisfaction in what we have accomplished, great optimism over what is ahead and great pride that we are restoring General Motors as America’s standard bearer in the global auto industry,” Akerson said in a message to employees.

Barra, left, at the GM annual shareholders meeting on June 12 with CFO Dan Ammann and Vice Chairman Steve Girsky.

Engineering background

Barra has played a role in GM management for a generation. Her career has included time as vice president of global manufacturing engineering, head of GM’s Detroit Hamtramck Assembly plant and executive director of competitive operations engineering. Before becoming GM’s first female product chief, she was the company’s top human-resources executive.

Most recently she led the company’s $15 billion vehicle-development operations, a high-profile role that’s given her sway over the look and feel of the full line of GM cars and trucks. She was promoted to that position in early 2011, less than six months after Akerson became CEO.

Some of the new vehicles to come out under her include the Chevrolet Impala, the first U.S. sedan in at least 20 years chosen by Consumer Reports as as the best on the market, and the Cadillac CTS, picked as Motor Trend’s car of the year.

Hidden successes

Some of her other achievements aren’t easy to see.

He asked her to cut costs by aligning purchasing and product development, two powerful units that had long been at odds. In one early example, GM engineers and suppliers found savings by redesigning knee air bags so that they could be used in more vehicles without having to design different dashboards for each model.

“If it’s customer facing, why does it have to be?” Barra said of the conversations she’s had with engineers. “And then if it’s not, why can’t it be common for the globe? Some components and subsystems depend on the size of the vehicle, the performance you’re looking for. But if you start with questioning ‘why can’t I have one solution?’ then you get engineering thinking completely differently."

'Car gal'

Akerson presaged Barra’s appointment earlier this year when he predicted that a woman will eventually run one of the three largest U.S.-based automakers.

“The Detroit Three are all run by non-car guys,” Akerson said in September in Detroit. “Someday, there will be a Detroit Three that’s run by a car gal.”

He declined to identify any contenders at the time, saying only that “there are an unbelievable number of talented women in automotive, certainly at General Motors.”

News of the changes come a day after the U.S. government disclosed the sale of the last of its shares in GM. Bailouts from the George W. Bush and Barack Obama administrations gave U.S. taxpayers a stake in the automaker while helping GM avoid liquidation. The company reorganized in a 2009 bankruptcy that helped it reduce debt, trim labor costs and sharpen its focus on only the strongest brands.

Mike Colias and Bloomberg contributed to this report.