GM’s board and CEO Fritz Henderson parted ways Tuesday, the board upset that the automaker was changing too slowly and Henderson frustrated with second-guessing, two people close to Henderson said.
Board chairman Ed Whitacre Jr., former head of AT&T Inc., will take over as CEO while a global search is conducted.
It was unclear whether Henderson or the board moved first in the surprise resignation, which came just hours before Henderson was to be the high-profile keynote speaker at the Los Angeles Auto Show.
At a hastily called news conference at General Motors Co.‘s downtown Detroit headquarters, Whitacre would not answer questions, but said the board and Henderson agreed that he should step down.
Whitacre thanked Henderson, 51, a lifelong GM employee, for his leadership and said the company is on the right path toward offering high-quality cars and trucks worldwide.
“We now need to accelerate our progress toward that goal," Whitacre said in a brief appearance.
Both men were chosen for their jobs by the U.S. government, which owns more than 60% of the Detroit automaker in exchange for giving it billions in loans. But Henderson is a GM insider, while Whitacre is an outsider to the whole industry.
Still, Whitacre and the board have become increasingly active in the company’s decisions, at times challenging some of Henderson’s moves.
In November, the board voted to abandon plans to sell GM’s European Opel unit, reversing an earlier option favoured by Henderson to sell it to a group led by Canadian auto parts supplier Magna International Inc.
Henderson, who rose through GM’s ranks over a 25-year career, was chosen by the Obama administration to run GM in March after it forced out former CEO Rick Wagoner. His brief tenure was marked by GM’s record-fast departure from bankruptcy court but also some failed deals and weak sales.
The people close to Henderson, who asked not to be identified because Henderson has not spoken, said he was frustrated from the beginning by the board and government push for faster change and other questions about his decisions.
Henderson, one of the people said, was confident that the company was making progress and thought he deserved more autonomy. In the past few months GM has stabilized its U.S. market share at around 20% and has shown some monthly sales increases in the U.S. and Asia.
But on Tuesday, GM released November sales figures that were 2% below the same month last year, when sales hit a 26-year low. The decline came after Whitacre began pushing for increased sales and market share.
“I don’t think this has much to do with Fritz Henderson’s performance, I think it’s just the wrong time to be a GM lifer," said Logan Robinson, a former Chrysler attorney and professor of corporate governance at University of Detroit Mercy.
