Ed Whitacre to Helm GM

Former AT&T Inc. (NYSE: T) chairman and CEO Ed Whitacre has found what might be an even higher profile gig: He'll be the new chairman of General Motors Corp. (GM) when it emerges from bankruptcy.

GM made the announcement today, adding that interim chairman Kent Kresa will remain on GM's board. GM's press release says the other six board members "will most likely retire" -- and if they don't take that hint, the release adds that "a selection process is currently underway" for their replacements. (See GM Hires Whitacre.)

Light Reading readers will no doubt remember Whitacre, 67, as the head of SBC, the regional Bell operator that took over AT&T in 2005. (See SBC to Buy AT&T for $16B and SBC Brass Dominates the New AT&T .)

He's also the executive who made the decision to build U-verse using the carrier's established copper network, rather than build a fiber network as Verizon Communications Inc. (NYSE: VZ) has done with FiOS. (See Verizon's Big Risk.)

Whitacre stepped down from AT&T in 2007, leaving his mark in the form of a lavish $158 million retirement package that included health benefits, club memberships, and home security. Whitacre had also accrued $85.2 million in compensation for fiscal years 2000 through 2005. (See Letter to Ed Whitacre, Come On, Pilgrim, and AT&T Holders Cry Foul Over Exec Pay.)

GM, which recently filed for a bankruptcy reorganization that will make the U.S. government a 60 percent owner, hasn't indicated what kind of perks will come with Whitacre's new post.

— Craig Matsumoto, West Coast Editor, Light Reading

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gocowboys 12/5/2012 | 4:03:04 PM
re: Ed Whitacre to Helm GM Does anyone think that this is a good idea? This seems nuts to me.
Pete Baldwin 12/5/2012 | 4:03:04 PM
re: Ed Whitacre to Helm GM

I'm not sure it's a good idea.  But to play devil's advocate: One thing Whitacre has going for him is a non-Detroit-legacy mentality.  This article from Wired talks about the need for car makers to adopt a model that lets them open up more to startups:

<h1 id="articlehed">Beyond Detroit: On the Road to Recovery, Let the Little Guys Drive</h1>

So you could argue Whitacre is coming from the right kind of industry, one where his end product was built from a variety of vendors with room for new ideas to break through. (As long as they got acquired by someone like Cisco first.&nbsp; I guess I'm not putting up much of a case here.)

Then again, one certainly hopes Whitacre doesn't get the same kind of pay and retirement packages he got at SBC/AT&amp;T...

FbytF 12/5/2012 | 4:03:03 PM
re: Ed Whitacre to Helm GM Kiss the bail out money goodbye, it seems almost impossible that GM and the government couldn't find a car guy to run GM. Maybe no one appreciates how much trouble GM is in, the only way to save it is to have a real car guy run it. Instead you have a guy who spent have his career running a monoply. At least he'll be at home with the excessive perks. Sickening, R.I.P. GM
gocowboys 12/5/2012 | 4:03:01 PM
re: Ed Whitacre to Helm GM I quite agree...you really need a car guy to run a car company. None of us would get a job working for GM as we are not considered car technologists.

In addition, AT&T has had a history of issues and making very bad decisions. They certainly have not set the world on fire with IPTV...Verizon has done much better with FIOS. The wireless division is bolstered by the iPhone, but their network is quite poor in comparison with Verizon.

It is amazing that the government would support this type of executive move. Fisker would be a much better choice IMHO.
Pete Baldwin 12/5/2012 | 4:03:00 PM
re: Ed Whitacre to Helm GM

I can understand the reservations about Whitacre, but ... getting a car guy to run GM? Really?

I'd expect a car guy to keep GM in "car company" mode -- that is, the same morass it's been in for years, except with government backing this time.

GM is too big to just erase everything and start over, sure, but it seems what they really need is for someone to draw up car-company blueprints from scratch, with no legacy baggage, and then start pushing GM in that direction.&nbsp; Yes, I'm taking cues from that Wired link, but I'm thinking that that new direction isn't going to look much like what a car company is today.

gocowboys 12/5/2012 | 4:02:59 PM
re: Ed Whitacre to Helm GM ...and why do you think that Ed is qualified to enact such a turn around? There are a number of innovative executives in the space. I don't consider Ed innovative or qualified. I am glad that my tax dollars are going to such a worthy enterprise.
Pete Baldwin 12/5/2012 | 4:02:58 PM
re: Ed Whitacre to Helm GM

&gt; ...and why do you think that Ed is qualified to enact such a turn around?

Didn't say he was.

fgoldstein 12/5/2012 | 4:02:55 PM
re: Ed Whitacre to Helm GM

Ed's great at milking a monopoly, and leveraging monopoly power.&nbsp; He maybe could have handled the GM of the 1950s, when it was king of the road.

Nowadays it's a strange choice.&nbsp; But I do note one thing.&nbsp; SBC/ATT was very good at milking every last dime out of obsolete plant (i.e., U-Verse).&nbsp; And GM is full of obsolete technology!&nbsp; Maybe he has ideas for milking pushrod engines, leaf springs, and 80-inch-wide steel sedan bodies.

Or maybe he'll require that warranty service be done in India.

gocowboys 12/5/2012 | 4:02:50 PM
re: Ed Whitacre to Helm GM

You know, I think that the U-Verse architecture will be judged as being a mistake. The jump to IP Video over ADSL2+ was pretty frought with issues and did not provide enough differentiation with the Cable/MSOs. To further cloud the issue, SBC continued the relationship with DirecTV. I think that Ed will probably decide that they should be investing in the lada. This appointment is just completely mind boggling. Given the need for innovation in the automotive market, a visionary such as Fisker or Tesla (or equivalent) would know the business and insert the right car vision. I hear that Madoff will be coming over to run Verizon. :-)

kaps 12/5/2012 | 4:02:49 PM
re: Ed Whitacre to Helm GM

Does anyone else find it amusing that the guy who derided Google and Vonage for taking a "free ride" on AT&amp;T's pipes is now at the helm of one of the biggest taxpayer bailout boondoggles?


Just askin'!

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