It’s all about the GM this week. After the announcement made earlier last week where GM stated that Chevrolet is leaving Europe, and after all the fuss about Holden finishing its production in Australia, GM today released more breaking news. Finally, the United States Treasury Department sold all of its GM shares.
GM filed for Chapter 11 bankruptcy plan on the first of June 2009. The US Treasury Department took ownership of approximately 60 percent of its shares. Reconstruction of the company began immediately. More than 3,400 management positions were axed and new management took over the helm of this sinking boat. Along with taking 60 percent of the GM’s shares the US Treasury Department, following strict Obama’s guidelines, injected 30 billion dollars in GM and the company started to emerge as one of the leading conglomerates in the US soon after. Now, only four and a half years later, the US Treasury Department sold its last GM shares, but for a price of 10.5 billion dollars in losses for US tax payers. “Government Motors”, as the media called GM, again become General Motors and the government recovered 39 billon dollars out of the 49.5 billion dollars they invested over the course of four and a half years.
During this time, GM closed 14 of its plants, reducing the number of its employees by more than 20,000, and closed more than 2,000 of its dealerships in the US. The Chapter 11 Bankruptcy plan lead to the vanishing of car brands such as Saturn, Saab, Hummer and Pontiac. However, these were necessary steps in order to retrieve the greatness of the former GM. Now we can see the results. GM has been steadily growing for 15 consecutive months, and their shares rose to a record level since the recession ($41.16, although shares fell slightly after Dan Akerson announced a withdrawal from GM).
Therefore, it’s about time for GM’s new management to get their piece of the cake too.
Along with the announcement about US treasury selling all of its GM’s Shares, GM announced the checkout of the CEO and chairman of GM for the past three years, Dan Akerson. General Motors CEO will leave his office on the 15th of January and he will be succeeded by Mary Barra (a new CEO) and Theodore Solso (a new chairman).
In GM’s statement published today, Akerson published a message addressed to the employees of the company. Akerson said “I will leave with great satisfaction in what we have accomplished, great optimism over what is ahead and great pride that we are restoring General Motors as America’s standard bearer in the global auto industry.”
In an official press release, GM states the new CEO, Mary Barra, is basically GM’s child with more than 33 years of experience in this company. Mary Barra moved from the position of executive vice president of Global Product Development, Purchasing and Supply Chain to CEO position with a full support of the Board of Directors. “With an amazing portfolio of cars and trucks and the strongest financial performance in our recent history, this is an exciting time for today’s GM. I’m honored to lead the best team in the business and to keep our momentum at full speed.” added Bara after she had been elected to lead the company.
Dan Amman, GM’s CFO who led a transformation of the company’s finance operation has been promoted to the position of company’s president.
Mark Reuss, who led the GM’s operations in North America as the president of that part of the company will take over Barra’s place. Practically all of the managerial staff has been promoted, so we can expect GM to grow even further.
This “fairytale” is finally shaped by a statement the White House issued. In the statement president Obama praised the US car industry. “When things looked darkest for our most iconic industry, we bet on what was true: the ingenuity and resilience of the proud, hardworking men and women who make this country strong. Today, that bet has paid off. The American auto industry is back.” Obama said in the statement.