Cars and Drivers

GM Management Shake-Up Continues

2014-Chevrolet-Cruze
General Motors Co.
The people in charge of human resources and public relations at General Motors Co. (NYSE: GM) last week are no longer in the driver’s seat. Both have left the company to pursue other interests, according to a GM announcement this morning.

The company’s new CEO, Mary Barra, is probably doing what any new CEO would do: building her own team. But given the millions of vehicles the company has recalled since the beginning of the year, those recalls are a lens through which everything GM and Barra do for the next several months must be viewed. Last week, Barra suspended two GM engineers with pay for their roles in the decade-long delay in reporting the ignition switch defect that has led to the recall of some 2.6 million vehicles and is linked to 13 deaths.

Barra has already named a veteran GM executive to the human resources job, but a new head of corporate communications is still being sought. That should be no surprise. GM needs a person with two strong suits: someone who can take a dozen broken eggs and make an omelet out of them, and someone who can deal effectively with Congress. Both facets are critical to the company right now, and GM is going to take its time finding the right person.

It is to Barra’s credit that she sees this and didn’t just promote some GM lifer. Maybe there is a highly qualified candidate already working for GM, but the odds are against it. And even if there were, to a skeptical public promoting from within does not appear to be a change that will make a difference.

That’s not to say the HR job is not important too. Bloomberg reported this morning that one employee tried for two years to bring the ignition switch defect to the front of corporate consciousness with no result. Bloomberg cites a 2013 email from a government official charging GM with being “too slow to communicate” and “too slow to act.” A capable HR executive could drive a change in what now looks to many as a culture of incompetence and subterfuge. Barra’s selection, John Quattrone, has been with GM since 1975.

Shares of GM were up about 2.4% in the noon hour Monday to $32.70. The stock’s 52-week range is $28.75 to $41.85. There remains a real threat that shares could drop as low as $20 if GM fails to find the right answer to its current troubles.

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