Business

‘Government Motors’ CEO Complains of ‘Lumbering Bureaucracy’ During Interview

Dan Akerson was named to General Motors’ board of directors by the U.S. Treasury in July 2009. He became CEO of GM in September 2010 and chairman in January 2011.

He was recruited by the federal government to join GM as the company was leaving bankruptcy protection. The government was majority owner at the time, and Akerson thought his management, financial and engineering expertise could help the car manufacturer.

However, despite these admittedly impressive skill sets, many thought that his recruitment to the GM board was odd because, well, he admitted he knew nothing about cars in the beginning.

“Akerson is not–and never has been–a car guy. He himself said so. What is he? He is a DC-connected, Wall Street hedge fund big coin guy,” writes Seton Motley of the Washington Examiner. “Akerson’s immediately preceding gig was Managing Director and head of Global Buyout for the incredibly inside-the-Beltway-connected Carlyle Group.”

So, maybe he wasn’t brought onboard GM just because he was really, really good with management. (Allegedly, that’s all changed as he now “speaks with authority on everything from transmissions to batteries,” gushes the Associated Press.)

Akerson has also gained some notoriety for being a bit too candid during interviews. Recall that in earlier comments made to reporters, Akerson said that Ford should “sprinkle holy water” on its troubled Lincoln luxury brand, and that Toyota’s Prius hybrid a “geek-mobile” (while these things may be true, they only become a headache for GM’s public relations team).

Now his most recent complaint is against GM’s “lumbering bureaucracy.”

“There is a resistance to change,” at GM, Akerson recently told The Associated Press.

Akerson, who often uses military metaphors, spoke with The Associated Press in New York about the car industry, the economy, his management style and the future of electric cars. Excerpts appear below, edited for length and clarity.

Here are some excerpts from the interview:

Q: Would you recall all 6,000 Volts to strengthen the battery?

A: If we find that is the solution, we will retrofit every one of them. By the way, if someone wants to sell it back to us now, we’ll take that too. We‘re quite confident that we’ll find a solution.

Q: Do you think the news about the Chevy Volt will harm sales of electric vehicles?

A: This car is safe. There is nothing happening immediately after the crash. I think in the interest of General Motors, the industry, the electrification of the car, it’s better to get it right now, when you have 6,000—instead of 60,000 or 600,000—cars on the road. We’re not the only car company that has liquid cooled batteries out there. There are many. So we think this is the right thing to do for our customers, first and foremost, and it was the right thing to do for General Motors and the industry [emphasis added].

Speaking of “the right thing to do for our customers,” why didn’t GM mention the exploding-battery problem sooner?

Q: Are you moving past the early technology adopters on the Volt at this point, or has any data surprised you on who is actually buying this vehicle?

A: The average purchaser of a Volt is earning $170,000 a year…

[Editor's note: Is he admitting that GM knowingly markets its product to the “very wealthy”? Wait until Occupy hears about this.]

Some of them — I think roughly half — are either Prius or BMW owners. So one, you could say Prius owners were probably early adopters in the olden days, but that’s kind of passed through. But BMW people want styling, good design, and an innovative powertrain, or power source, and I think Volt is a game changer. And quite frankly that’s one reason we want to kind of clear the decks here.

As you may remember, in the early days of Lexus, there were real issues surrounding quality. And they called back 8,000, reworked them, and put them back out. People don’t remember that because Lexus is a great car, it’s a great brand. I think it demonstrated that Toyota was sensitive to their customers’ needs, perceptions, and safety, and it was an analog to what we wanted to follow here.

One could argue that the entire time Lexus has existed as a brand, it has never had to deal with the type of problems electric cars face. One could argue that the reason Toyota was able to revive the Lexus brand and make it a successful competitor in the market was because the problems it faced were relatively surmountable.

Q: How has the corporate culture changed at GM since you joined the board?

A: I would say, objectively…90 percent of what we did was good. There is tremendous commitment and loyalty to this company. But it’s that the 10 percent or 5—I don’t know how to quantify it precisely—we failed.

Recognize what went wrong, learn from it, move on . . . I don’t want to obsess on it, but I want to learn from it. And that’s the mantra that we have as a team.

So I would say we’re making good progress, we’re doing surveys on people. What do they see right? What do they see wrong? How do they view the management? We want to know…

I wasn’t used to such a command-and-control. I said “We’ve really got to make Cadillac a global brand.” Next thing I know, go to the Geneva (auto) show and we have North American cars, no right-hand drive, no diesel sitting there, and you’re going like, “Oh God, why didn’t we do that?” ”Well, you said you wanted to make it a global brand” . . . You don’t have right-hand drive, you don’t have diesel, you’re no good in Europe.

You know who would have thought of that? Perhaps a “car guy.”

Q: If you could wave a magic wand, what two things would you change at GM right now?

A: I want a miracle solution on Volt in the next week…I want sustainable, differentiable product.

The second thing is, we‘ve got to make sure that the culture evolves to one that’s less hierarchal, flatter, more interactive, more participative.

Q: What makes you the maddest as a CEO?

A: There is a resistance to change…

Every corporation has to change, or it dies. You lose your competitive edge. There’s a real strong competitive gene at General Motors. I would say you have to meet the market on its terms, you cannot dictate to the market. I don’t like where our stock is. Well, what can I do about it? Execute on the fundamentals and the market will change and appreciate that. But at the end of the day, you have to create a culture that not only accepts change but seeks out how to change…

Q: Is there no longer a stigma about going to work at GM?

A: I don’t think so. We are getting good young people. People want to work for us. For example, when I got there, when we thought about OnStar, we thought about safety and security. Now we’ve amalgamated that with infotainment. And it’s now starting to draw people out of Silicon Valley…

Q: How long do you plan on staying at GM?

A: I bought a condo in Detroit. I like the company. I like the city. I like the industry and I guess as long as I’m having fun and the board wants me, the management is willing to follow, I’ll stay.

Read the entire interview here.

Comments (39)

1 2
  • roadhog
    Posted on December 17, 2011 at 5:44pm

    How about that Vollt a Big Socailist idea of a profitable Car. Obama Motors No Thanks

    Report Post »  
  • patbarker
    Posted on December 17, 2011 at 11:29am

    what a joke…NBC (and it’s cable children) have given their boy Barack and his Volt TONS of free advertising…to NO AVAIL!!!

    Report Post »  
    • Gravejoke
      Posted on December 17, 2011 at 11:37am

      So far the best advertising on the Volt is how many fires it and its accessories cause. It doesn’t have to be positive to be advertising (like political ads). =)

      Report Post »  
  • Gravejoke
    Posted on December 17, 2011 at 11:22am

    It’s the bed you made GM, now lie in it.

    Report Post »  
  • Detroit paperboy
    Posted on December 17, 2011 at 10:00am

    The chevy Volt will not exist in a year…… Nobody wants them . Simple economics say yoi cant create a market where none exists, but MARXISTS dont get that…. There is plenty of oil for five hundred years, in the future we will drill ten times deeper and huge motherloads, but they keep prices high by claiming its running out, hell for all we know oil itself is renewable, i mean hell, the earth didnt just stop making it one day…

    Report Post »  
  • LOJ
    Posted on December 17, 2011 at 9:21am

    I got news for Akerson, The Volt is a total flop, Hardly anyone wants this puddle jumper, and its a hassle to have to charge up the battery. Most of us love our SUVS, they are much safer and put something between us, the road, and another car that would run into us. GM had to be bailed out because of paying out so many benefits to their workers…The High Price of GM Cars has caused people to buy foreign cars, Honda, Toyota, Hyundai, etc. The fact that they are owned by the Government makes them even less popular after Obama’s failed presidency, not to mention that On-Star wants to track their customers instead of the criminals, and possibly sell the data to insurance companies….I would say GM has not made good decisions based on Sound Advice.

    Report Post »  
  • grayling646
    Posted on December 17, 2011 at 9:08am

    I wouldn’t buy a new GM product if they promised me the winning lottery numbers were in the glove box.

    Well, actually, that’s not true….

    Report Post »  
    • Roywalling
      Posted on December 17, 2011 at 7:00pm

      Gray,take the lottery numbers out of the glove box.Then go by a new Ford.

      Report Post »  
  • M24
    Posted on December 17, 2011 at 7:59am

    The cars today have no class ,Just Transportation and some cant even get that right . Back In The Day When You Bought a new car it was a extension of you ,Where You are at the time ,You could tell the difference between the cars. Now They All Look The Same, Im not a GM fan anymore But They Got One Model Right ,The 1957 Chevrolet Belair Man What a Car!!

    Report Post »  
    • lukerw
      Posted on December 17, 2011 at 8:15am

      What Americans want… is no longer considered… rather ideals are based upon the Failing EU & 3rd World designs!

      Report Post » lukerw  
  • weisscrow
    Posted on December 17, 2011 at 1:25am

    Friend works as govt contractor. He said govt purchased thousands of unnecessary gm vehicles for the facilities he sees. I guess it was more stimulus going on than even we know about to directly shore up the stock value this would gave the impact of raising the stock artificially with the bill being spread out amongst every agency in the govt…

    Report Post »  
    • Living In NYC
      Posted on December 17, 2011 at 6:49am

      Weisscrow you are so right, I go by a small federal government office in my local area and the parking lot on Saturday has more new GM cars sitting idle than the local Chevy Dealer!

      I haven‘t seen any of the Emperor’s “Coal Fired” and “Flame-Thowing” Volts! Waiting to see a influx of Volts to boost the dismal sales of Emperor‘s People’s Car!

      Glad to see the CEO of GM gets to expereince how government and unions work..when you do a deal with the devil you have pay! What his deal attacking Ford and Toyota…need the libs to drum up some more “failures” to increase sales!

      As I said in the past..we had five Pontiacs in 2008 now we have four Fords and on Pontiac! Geez I love them V-10′s in the F-250. I can‘t to roll by a Volt make a little turbulence watch the driver start praying the little thing doesn’t flame on!

      Report Post » Living In NYC  
  • Rolandd
    Posted on December 17, 2011 at 1:00am

    The intellectuals in Washington in their infinite wisdom provided leadership and can‘t understand why it isn’t working, thus the mental disconnect.
    Why do some confuse intellectuals with people of intelligence? The intelligent thing to do is find someone in the auto industry that know what needs to be done and not someone whose only knowledge is getting in a car and starting it.

    Report Post » Rolandd  
  • Tretka
    Posted on December 17, 2011 at 1:00am

    Ah, no kidding Mr. Smarty Pants, you took a government job. If you think you feel lumbering now-wait until the next two years. What a quack. Hello, knock, knock, this is Ms. Opportunity knocking, go to Ford, go to Toyota, but run man, run.

    Report Post » Tretka  
  • mrmikejohnson
    Posted on December 17, 2011 at 12:45am

    Gee, I would have thought the government would be good at running an auto company. The post office, DMV, and public school system are doing so great. Might as well ad auto companies and health care to the government payroll.

    Report Post »  
  • 1olderbutwiser1
    Posted on December 17, 2011 at 12:41am

    Another overpaid American CEO. Natural gas vehicles will overtake gasoline vehicles in the next ten years. The battery powered vehicle would need a 200 mile range to be practical to market, and how much does it cost to replace the batteries, and how often? Burn coal to charge the batteries, yes, this cleaning the environment? I don’t want to plug in everytime I get home. Do you? I am a realist, not am idealist. What kind of people do we have running these companies?

    Report Post »  
    • Baddoggy
      Posted on December 17, 2011 at 3:18am

      They will NEVER allow natural gas powered cars to be mass produced. It would solve the problem they created in the first place. We can’t have that!!!

      Report Post » Baddoggy  
  • tbl10
    Posted on December 16, 2011 at 11:47pm

    Dan Akerson said: “Every corporation has to change, or it dies. You lose your competitive edge. There’s a real strong competitive gene at General Motors. I would say you have to meet the market on its terms, you cannot dictate to the market.”

    So what does GM do, they put a P.O.S. car on the market that nobody wants. Sure sounds like your dictating to the market instead of listening to it to me. NEWS FLASH DAN nobody wants your Chevy Volt. Perhaps if you built some cars that didn’t look like a shoe on wheels the under 30 crowd would buy your cars. The reason the Japanese have kicked your a$$ for the past 25 years with the under 30 crowd is because they do build good looking sports cars with lots of features that people want. Continue with your tradition Dan and Chevy will die and next time you won’t get a tax payer bailout.

    Report Post »  
  • Beckaj
    Posted on December 16, 2011 at 11:44pm

    Reality has a way of biting you in the ass.

    Report Post »  
  • Thevoice
    Posted on December 16, 2011 at 11:31pm

    I would like to point out the mental disconnect which continues to lead to failure with modern day business…..Government and the nation as a whole. It is also the mental disconnect which leads to financial disaster the American people keep paying for….OK… First the story say this…He (Dan Akerson ) was recruited by the federal government to join GM as the company was leaving bankruptcy protection. The government was majority owner at the time, and Akerson thought his management, financial and engineering expertise could help the car manufacturer……Ok then you read this ..and the mental disconnect……“Akerson is not–and never has been–a car guy. He himself said so. What is he? He is a DC-connected, Wall Street hedge fund big coin guy,” writes Seton Motley of the Washington Examiner. “Akerson’s immediately preceding gig was Managing Director and head of Global Buyout for the incredibly inside-the-Beltway-connected Carlyle Group.” …So can the guy change a flat tire for starters….I mean if you were going to interview someone to run your car company. Wouldn’t you ask for starters what skills does the guy have to actually know and work to build a auto..I mean from what I read he has been a desk Squatter. That the Government hired..Using our money. And there it is in a nut shell.We have totally lost our common sense..better know as street smarts…

    Report Post » Thevoice  
  • georgepatton
    Posted on December 16, 2011 at 11:27pm

    Hey,
    I actually saw a Chevy Volt on the highway………….Elvis was driving it!!!!!!!!!!!!!!!!!!!!!!

    Report Post »  
    • Exrepublisheep
      Posted on December 17, 2011 at 12:42am

      lol

      Report Post » Exrepublisheep  
    • Living In NYC
      Posted on December 17, 2011 at 6:58am

      No George…that was Chevy Cruz with Volt badges sitting at the dealer and a full size Elvis doll in it. Not even the dealers are buying the Emperor’s Car…unless their is a 100% buyback program from the taxpayer’s pockets!

      BTW, did you notice that Elvis’s suit was a fire suit holding a piggy tail lightbulb!

      Gota love them green government boondoggles…NOT!

      Report Post » Living In NYC  
  • Mikev5
    Posted on December 16, 2011 at 11:09pm

    Sounds like he is the problem still thinking the electric car is the future and talking like it’s a winner and seeing many of these on the road.

    He must be taking some heavy meds to think that.

    Report Post » Mikev5  
  • Eliasim
    Posted on December 16, 2011 at 10:48pm

    The commies took over GM just as the commies in Russia took over farms. Then what happened? Not good things.

    Report Post »  
  • Eliasim
    Posted on December 16, 2011 at 10:46pm

    It seems to me “Lumbering bureaucracy” put him in as the CEO. What’s he complaining about? Oh that’s right, that’s how they do things in that they cause the problem and then present the fix, which actually also becomes a problem.

    Report Post »  
  • smartgirl
    Posted on December 16, 2011 at 10:35pm

    Wow, he is really UNimpressive. What were they thinking? Maybe nobody who knows cars wanted to work for the government.

    Report Post »  
  • Stoic one
    Posted on December 16, 2011 at 10:27pm

    The title said it for me ‘ government motors’, most of the vehicles I have owned were General Motors….never again that company died. Wifey and I agree– Toyota or Ford ( maybe something else)
    government motors took taxpayers dollars and have not honestly paid it back; yea I have read about the accounting witchery — gm still owes the taxpayer.

    Report Post » Stoic one  
  • Hickory
    Posted on December 16, 2011 at 10:14pm

    Designed by the union, managed by a banker.

    Report Post » Hickory  
    • TreeTrimmerJim
      Posted on December 16, 2011 at 11:08pm

      Unions have never went on strike for quality, better designs, better testing.

      Report Post » TreeTrimmerJim  
  • ACACIA
    Posted on December 16, 2011 at 10:14pm

    both russ perot and lee iacocca tried to change gm and failed. lee wanted gm to build minivans but gm said,“ shove it”; instead they decided to build the pontiac fiero and you know what a piece of junk that turned out to be. lee took the minivan to chrysler and everyone knows what a big hit it has been ever since. gm is a loser and the sooner everybody knows about it the sooner gm will fade away and good car companies can continue to prosper.

    Report Post »  
  • progressiveslayer
    Posted on December 16, 2011 at 9:43pm

    Central planning produced the trabant a POS E. German vehicle nobody wanted,sound familiar?

    Report Post » progressiveslayer  
  • yetibunker
    Posted on December 16, 2011 at 9:38pm

    let car companies build what people want, suv’s ect. and no bailouts!

    Report Post » yetibunker  
1 2

Sign In To Post Comments! Sign In

Sign Up For Our Newsletter!

Glenn Beck Radio

Listen to Glenn Beck 24/7 Listen Now
Restoring Love