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By Joel Schectman
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Thursday's announcement of Ed Whitacre's resignation as CEO of General Motors Co. was puzzling. The notice came in the middle of an earnings call where the company reported that Whitacre had brought it back from the dead to a second straight quarter of profit. The timing also complicates the automaker's plans to offer its shares to the public for the first time since the government took over in June 2009. "The IPO is already a time of real uncertainty – this adds to it," said Rebecca Lindland an analyst for IHS Automotive.
When Whitacre took over the failing automaker, the position had all the charm of a dump truck. The century-old automaker was in bankruptcy. Stockholders, some of whom had passed on GM shares over generations, were wiped out. In a controversial move, the government came in and bought a majority stake in the company, effectively nationalizing the iconic American brand.
Whitacre helped turn the company around. He chopped entrenched executives that had been kept on after years of mounting losses. He made customer satisfaction the No. 1 goal for a company that had lost the public's trust. Whitaker even appeared in commercials promising that unhappy owners would get their money back.
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But Whitacre's tenure also represented the company's past failings. Appointed by the Obama administration at a time when many thought the carmaker would cease to exist, Whitacre was never comfortable running a "Government Motors," as he put it. His exit comes as GM hopes to put the humiliation of government ownership behind it.
The stock sale will be used to start buying out the government's 61 percent stake in GM. Daniel Ackerson, a buyout specialist at the private equity firm Carlyle Group, will take over the post. "This is a guy who has his fingers in a lot of financial pots – he knows how to manage an IPO," said Lindland.
And as GM stocks start to hit the market as early as November, putting Ackerson, a powerful financial insider, at the helm sends a message to Wall Street: Government Motors is on its way out and General Motors is back.
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