DETROIT -- Harry Wilson has made it clear that General Motors' inert cash pile is just the first problem he would like a chance to fix if he gets himself elected to GM's board.
"This is certainly much broader than a capital return question," Wilson said in an interview Tuesday. He acknowledged that GM's business is "radically better" than before its 2009 bankruptcy, but said the company "still dramatically underperforms its potential."
In the formal request he submitted to GM this week, the 43-year-old Wilson focuses on what he considers an inadequate return to shareholders from GM's $25.2 billion in cash and securities. He wants GM to commit to share buybacks of $8 billion by June 2016.
But his comments in media interviews on Tuesday suggest that Wilson, a key architect of GM's 2009 restructuring as a member of President Obama's automotive task force, could press GM on a number of fronts should he succeed in his bid for a spot on its 13-member board.
Wilson said GM has been unable to use its size and scale to achieve the profitability levels of its peers, leaving the company with a "dirt cheap" stock price.
He said, for example, that GM doesn't leverage its supply base to drive innovation; doesn’t do a good job monetizing its innovations, such as OnStar and its onboard 4G LTE wireless service; and hasn’t done enough to reverse losses in several overseas markets, including Europe, which he acknowledges is "structurally challenged."
GM said Tuesday that its board would consider Wilson's proposal and make a recommendation on his nomination “based on the best interest of all shareholders.”
Too early to tell
Wilson, who represents four hedge funds that own 2.1 percent of GM's shares, said it's too early to tell whether his overture will lead to a proxy fight. He said he wants to work "collaboratively and constructively" with GM CEO Mary Barra, her executive team and the board to "drive change and address the company's shortcomings and challenges."
At a Feb. 3 meeting with Barra, Wilson said she seemed "surprised" by his description of the level of investor frustration over GM's shareholder return. He noted in the interview that its shares last week were trading around the same $33 level of its initial public offering more than four years ago.
Wilson also said that GM needs to be more transparent with investors about how it will achieve its financial goals, such as its forecast of 9 to 10 percent global profit margins by early next decade.
Without "interim milestones," he said, investors can't have confidence that GM will reach the long-term objectives.
Wilson didn't criticize GM's directors, but said the board is lacking in representation of large shareholders.
He noted that two former directors who were originally appointed to be voices of large shareholders -- private-equity investor David Bonderman and former GM CEO Dan Akerson, who joined the board in 2009 as a private-equity executive -- have since left.
"What we're talking about here is: How do we get the business to achieve its full potential and step up its performance?" he said. "We think that missing perspective of having the shareholder champion in the boardroom is an important part of that."