General Motors Chief Optimistic After Board Meeting
Wednesday, August 5, 2009; 10:41 AM
After his first board of directors meeting, General Motors Co.'s new chairman, Edward E. Whitacre Jr., said the company is working on its strategy to improve market share and expects to unveil some new models sooner than originally planned.
A former AT&T chairman, Whitacre spoke this morning on a conference call with about a dozen reporters, giving an update after meeting with GM's 13-member board in Detroit. He would not say which brands would be released on a faster schedule.
The bulk of the board's directors are new to the company and several of them were hand-selected by the U.S. government to help oversee GM's turnaround. Obama has committed about $50 billion to helping restructure GM, and in return the government holds a 60 percent stake in the company.
In the two-day board meeting, which ended Tuesday, Whitacre said the board reviewed the company's strategy, financial situation and products. "We're off and running," he said. The top priority is improving the company's market share and the number of vehicles sold, he said.
GM was once at the top of the U.S. auto sales marketplace but has been hit hard by foreign-owned brands. In July, its market share was 18.9 percent. That compared with Ford's 16.5 percent share and Toyota's of 17.5 percent.
Whitacre said the company is "going to work diligently to improve our market share."
The board gave feedback on the company's financial plans and as a result "changes were made," Whitacre said.
"The board is going to be very involved," he said. "We made some tweaks and changes, and I think that's very healthy."
One of the changes he said the board suggested was moving up the timeline for introducing some new vehicles with the goal being that the company becomes profitable. Becoming profitable, Whitacre said, could happen "sooner than most people think."
"I think we'll surprise some people at how fast we get there," he said.
He said he believes the company's finances are good. "Our balance sheet is terrific," he said. "We've emerged from bankruptcy thanks to the U.S. taxpayers and others."
He said there could be a possible public offering of the company in the future, adding "it wouldn't be out of the question in 2010."
He expressed confidence in the company's employees, saying "there's a lot of talented people at GM," but that's possibly been overlooked amid the company's recent bankruptcy. "I think we need opportunity to go forward and let people show their talent," he said.
Whitacre said he talks to chief executive Frederick "Fritz" Henderson almost daily but doesn't plan to be involved in the day-to-day operations. He said the board supports Henderson, who is a career GM executive, but expects him to show results.
Whitacre said the board has scheduled to meet once a month in Detroit and as needed on the phone.
He wouldn't comment on when he expects a resolution on talks to sell the Germany-based Opel unit, which is being sought by Canadian auto-parts supplier Magna International Inc. and Brussels-based investment firm RHJ International SA.
While at the board meeting, Whitacre said he and other directors test drove some of GM's car on the company's test track just outside of Detroit. He drove the much hyped Chevrolet Volt, the hybrid car that runs primarily on battery power. The car, which starts production in 2010, is a much needed boost to the company's lineup, analysts said.
"It is very impressive car," Whitacre said. "It is a leap in technology. It is something no one else has."