Yesterday, General Motors announced that it would bring former SBC and AT&T chief Edward Whitacre, someone with no automotive industry experience, to be its new Chairman when it emerges from bankruptcy. Whitacre, who is said to be a current Cadillac owner, successfully grew AT&T into the country’s largest telecom provider, but faces a daunting task with helping to turn GM around.
“I don’t know anything about cars,” Whitacre, 67, said yesterday in an interview with Bloomberg. “A business is a business, and I think I can learn about cars. I’m not that old, and I think the business principles are the same.”
Whitacre won’t be the first industry outsider charged with helping to turn around a struggling automaker; Ford hired former Boeing chief Alan Mulally to be its new President CEO because of the work he had done at the Seattle-based airplane manufacturer. Though Ford is not profitable, most analysts say that Mulally’s efforts, not to mention his public persona, have been highly beneficial.
Those same industry analysts seem to be universally positive on Whitacre’s appointment.
“He was one of the guys who helped create a new AT&T that wasn’t so dependent on land-line phone service,” Jim Hall of 2953 Analytics, told Bloomberg. “There’s a parallel with General Motors. GM is not now about just making cars. It’s about re-creating itself as a 21st-century car company. They have to have somebody at the top that understands they have to make a new GM.”
Whitacre, born and raised in Ennis, Texas, about an hour’s drive from Dallas, is said to be an aggressive but generally affable leader. His position at GM will be more about ensuring the automaker’s strategies remain in place by keeping an eye on leadership than in formulating them, as CEO Fritz Henderson will be expected to do.
