What a shock! GM to diminish Wagoner's role

Troy Clarke has been appointed president of GM North America and GM group vice president, effective July 1, General Motors Chairman and CEO Rick Wagoner announced today.

Clarke, president of GM Asia Pacific since 2004, will work closely with Wagoner in implementing the GMNA turnaround plan, and will oversee day-to-day operations of GM's largest sales region. Wagoner has been leading GMNA since April 2005 to develop and drive the region's turnaround strategy.

"While much work remains to be done, we have reached several significant milestones in our turnaround plan over the past year," Wagoner said. "This is the right time to turn the region's day-to-day operations over to Troy, who has the experience and skills to help lead the GMNA team as it continues this unprecedented restructuring. Troy has a track record of success in general management, manufacturing and labor relations in the United States and globally, which will be invaluable in his new assignment."

Wagoner said he and his senior leadership team will continue to be actively involved in executing the next key steps in the GMNA turnaround plan, including a successful resolution of the Delphi reorganization; completion of the accelerated attrition and capacity-reduction programs, and achievement of the $7 billion structural cost-reduction target; flawless launches of key new cars, trucks and advanced technologies; and ongoing refinement and acceleration of GM's brand and product-focused marketing strategy.

David "Nick" Reilly, a GM vice president and president and CEO of GM Daewoo Auto & Technology Co. in South Korea, will replace Clarke as president of GM Asia Pacific and will become a GM group vice president, also effective July 1. Reilly also will succeed Clarke as chairman of the GMDAT Board of Directors. A replacement for Reilly as CEO of GMDAT will be announced at a later date.

"Nick has demonstrated his managerial strength, most recently in growing GM Daewoo into a profitable enterprise that has quickly become a key part of our global expansion plans, well in advance of what was generally expected," Wagoner said. "The success of GM Daewoo is a tribute to Nick's leadership and commitment."

Vice Chairman John Devine, 62, who announced in December that he planned to retire this year, has decided to make his retirement effective June 1, Wagoner said.

"We all owe John a tremendous debt of gratitude for his vast contributions to GM over the past five years," Wagoner said. "John took on a number of challenging and important assignments during his tenure as vice chairman and chief financial officer. His extensive experience and expertise in the auto business, along with the respect he enjoys on Wall Street, enabled him to contribute to our turnaround in an exceptional manner."

Clarke, 51, joined GM at the Pontiac division in 1973 and over the succeeding decade held several engineering and manufacturing assignments there. He was named director of manufacturing for GM de Mexico in 1997, and president and managing director in 1998, when he also became a corporate vice president.

In 2001, Clarke was appointed vice president of labor relations in Detroit, and he became group vice president of manufacturing and labor relations in 2002. He served as GM's chief negotiator during the 2003 labor negotiations in North America.

Reilly, 56, has been at GM Daewoo since 2002, when he was named to lead the transition team for the company's formation. He has been a GM vice president since 1997.

He began his GM career in 1975 at the former Detroit Diesel Allison Division in the United Kingdom. From 1978 to 1984, he held assignments in Belgium, the United States and Mexico. After serving in operations and manufacturing posts with

Vauxhall and the Isuzu joint venture in Luton, England, Reilly became vice president of quality and reliability for GM Europe in Zurich, Switzerland.

Reilly returned to the United Kingdom in 1996 as chairman and managing director of Vauxhall, and returned to Zurich in 2001 as vice president of sales, marketing and after-sales for GME.

PlanoA4 - 5/30/2006 1:09:43 PM

+1 Boost

It is about time, they are distancing themselves from Wagoner, they are circling the wagons and getting ready for impending bankruptcy.

They even have hired AlixPartners as their Chief Financial Advisor. What does that mean to anyone you ask?

AlixPartners consulted to the following corporate implosions: Kmart, Dana Corp, Refco and Enron. Oh yeah one other minor meltdown….. WorldCom, the "world’s largest bankruptcy." What does that tell you?

adambravo - 5/31/2006 8:21:36 AM

+1 Boost

"Diminish" Wagoner's role?

Wagoner, who remains chairman and CEO, took over NA operations temporarily after the recent global executive shuffling (which put Cowger in charge of global manufacturing). Now that the dust has settled, he can go back to focusing on global issues.

PlanoA4 - 5/31/2006 9:24:11 AM

+1 Boost

GM had an estimated 10 billion in liquid assets as of the last time they posted. The true figure is unknown to those outside GM.

IF (note the big letters) Delphi strikes, GM has an estimated the burn rate of 1.1 billion dollars a day after production stalls. So do the math and that is under 10 days of reserves before implosion. Last I read the judge in the Delphi bankruptcy also denied GM the ability to buy out the Delphi union contract. Thus leaving GM powerless to intercede and avoid the strike. The reason? GM is a poor credit risk and the judge said they pose a greater risk than an asset.. interesting

Also if GM has one more credit rating drop, there is a bigger problem. With such a poor rating, the banks will no longer loan rental car companies the cash needed to purchase GM vehicles for fleet sales. Last time I looked fleet sales were 60% of GM’s business. That one simple move would bankrupt GM regardless of the Delphi strike.

Also preceding Wagoner’s demotion (err role revision). GM senior finance officers resigned after having to restate the last FIVE years of earnings. Smells a bit fishy. Actually this all sounds familiar, looks quite a bit like WorldCom

Obviously this all needs to play out. I believe Buick and Pontiac will go the way of the Dodo… SAAB will get sold, Hummer will survive with Chevy, Saturn, & Cadillac. GMC will dissolve into Chevy. Shares in dang near everything else have been sold off already.

Just food for thought.

PlanoA4 - 5/31/2006 11:04:05 PM

+1 Boost

Damn, my resource for the data has been off line all freakin day! I will update with the details and they are pretty good and are plausible. So keep lookin back for them, but this issue with sprout out again soon so don't fret.

PlanoA4 - 6/2/2006 1:00:18 PM

+1 Boost

Ok the reference site went up and i got twisted around for sure! GM EXPENDITURES are 1.2 bill a day NOT the Burn Rate as I stupidly said (hey I call a spade a spade, even if it was me).

The the big prob is GM needed about 10 billion to maintain operations and must keep 5 billion in the bank above that. So when you see it drop you need to subtract that from the figures.

I think I need to go play where, I know a bit more... typically before I spout off something like that I will back it up with a URL.. This time the site was down and I was quoting from memory.

Know where I can buy ginko biloba a a bulk rate? I think I need it after that blunder….Where is that dang “delete last post” key?