Interpac Business and Migration Solutions Melbourne Australia

December 2, 2009

GENERAL Motors signalled it could take months to find a new chief executive after today's surprise resignation by Fritz Henderson.

GM chairman Ed Whitacre will take over Mr Henderson's duties on an interim basis with immediate effect, while the company seeks someone to step in as president and CEO, and company officials suggested the focus would be on an external candidate.

Mr Henderson's departure comes just six months after he was named to replace long-time CEO Rick Wagoner, who ousted as part of the US government-backed bailout of the ailing auto-maker.

Mr Whitacre, a former telecoms executive, has led an activist board that has worked to break down GM's existing culture, sparring with what remained of the team Mr Wagoner had led. Disagreements included the fate of its Opel unit and the timing of a potential initial public offering.

Reading from a short, prepared statement in Detroit, Mr Whitacre offered no insight on why Mr Henderson was released, or how the company will conduct a search for a new CEO. Mr Whitacre would take no questions from reporters.

GM spokesman Chris Preuss said the search could take months rather than weeks, and hinted an external candidate was the board's main focus.

The company, controlled by the US and Canadian governments following its exit from bankruptcy, will have to contend with new federal pay rules in seeking a new CEO. An administration official said it played no role in the move.

Potential candidates identified by industry observers include Robert Lane, former chairman and CEO of Deere & Co, and 3M chairman and CEO George Buckley, as well as Caterpillar chairman and CEO Jim Owens.

Analysts said GM may be wise in following Ford Motor’s lead to hire an outsider.

“GM really needs someone with some fresh perspective,” said Gimme Credit high-yield bond analyst Shelly Lombard. “You need someone new because this industry is not going back to what it was. GM has started to climb out of the hole but they need someone strong at the helm.”

Mr Whitacre praised Mr Henderson and said GM had regained “momentum”, but he and other officials gave no further details beyond saying there was mutual agreement on the need for change.

GM vice-chairman Bob Lutz will stay on, and take on Mr Henderson's role as keynote speaker at the LA Auto Show today.
Chief financial officer Ray Young is also staying on, said Mr Preuss.

Mr Henderson, 51, had established himself as one of GM's turnaround specialists, but relations with Mr Whitacre soured following GM's bankruptcy exit, notably over the future of its Opel unit.

He led a remake of GM's Asian operations early this decade, and in 2004 was moved to Europe, where he accelerated a restructuring effort there - although GM Europe has continued to struggle since he left, losing money and market share.

(Source form TheAustralia.com.au)