Former GM CEO Fritz Henderson is no longer a $3000/hr consultant for General Motors, reports Reuters [via ABC]. Henderson, who was paid $59,090 per month for 20 hours of work per month as a consultant, left that lucrative position after being hired by Sunoco to oversee the spin-off of its SunCoke Energy business. TTAC estimates that Henderson made over $400,000 since being fired as CEO by Chairman Ed Whitacre. We remain mystified as to what possible impact his consultancy had on anything, short of possibly preventing an embarrassing (but likely very dull) tell-all book.
Tag: fritz henderson
Fritz Henderson was Mr Transition at General Motors, taking over when Wagoner was ousted by the Presidential task force, and losing the top spot when Ed Whitacre’s purges hit a fever pitch. So it’s not exactly surprising to find out that, in addition to his $3k/hr consulting gig at New GM, Henderson is also getting paid by Old GM’s wind-down firm AlixPartners. The Detroit News won’t spill the beans on compensation, let alone the nature of Henderson’s work as a consultant, but does note that AP has slurped down over $35m in fees since last year’s bankruptcy. AP’s reasons for hiring Henderson:
From time to time, AlixPartners contracts with experienced specialists to complement our existing team and to help us grow, and that’s our purpose in signing on Fritz Henderson as an independent contractor working on a part-time basis,
Fritz Henderson: because he was liquidating General Motors before it was cool. Meanwhile, is the volatility of contract consulting work really a good idea, given the Henderson family temperament?
Gosh, was it really just Monday that Bob Lutz was complaining about the pay problems round General Motors way? Automotive News [sub] reports that, in addition to hiring ousted CEO Fritz Henderson as a consultant, GM’s Chairman, CEO and VP for Rattlesnake Killin’ Ed Whitacre has been handed a compensation package including $1.7m in cash annually. Not to mention the $5.3 million in stock payable over three years starting in 2012, or the $2m in restricted stock. Sure, that’s not much compared to most Chariman/CEO types, but it’s not bad for a government teat-sucking, profitless wonder. Especially considering former CEO Fritz Henderson only made $950k in cash annually plus $4.2m in stock as CEO (he now makes $700k annualized as a 20 hour per month consultant). Ken Feinberg is slacking!
Because the man clearly knew how to turn The General around. Bob Lutz might not be getting paid enough for his taste, but as Henderson proves, it’s not the numbers on the check, it’s the amount of work you’re expected to do for them. Automotive News [sub] reports:
GM said it had hired Henderson yesterday as a consultant on a month-to-month basis, with the job to end some time this year. GM will pay Henderson $59,090 monthly to counsel GM on international operations. He will work about 20 hours per month and meet once a month with GM’s international president, Tim Lee, or one of his representatives.
GM Chairman and CEO Ed Whitacre has made his first real media availability today, answering questions on a number of issues including the deal that sent control of GM’s most important Chinese joint venture to its partner, SAIC. According to Whitacre, the deal was put in place by former CEO Fritz Henderson. “It was sort of done before I got here,” Whitacre tells Reuters. Not to worry though, Whitacre has met with his counterpart at SAIC and was assured that “the nature of the partnership would not change.” Meanwhile, Gasgoo all but confirms that the rationale behind the deal is competition in India’s small-car sweepstakes, as a $3,500 sub-Spark model is apparently being planned to compliment the GM-SAIC-Wuling commercial vans that will spearhead the effort. Given how crowded India’s small car market is shaping up to be, it’s interesting that Whitacre didn’t cancel the agreement as he did with Henderson’s deal to sell Opel to Magna. And as for Henderson’s departure? “There was just a common agreement that what you want to do is not what I want to do,” says Whitacre.
Autoextremist Peter DeLorenzo is an interesting figure in the auto commentary landscape. Though TTAC has often taken the pioneering car blogger to task for inconsistencies (especially during bailout mania), it’s no surprise that DeLorenzo’s ability to see things as they are comes and goes. After all, the guy is the quintessential insider’s outsider: as a former marketing and ad man, the Autoextremist is always in the Detroit tent… the only question week-to-week is whether he’s going to be pissing out or pissing in. Well, this week the deluge is headed straight for the part of the tent occupied by GM’s new CEO Ed Whitacre and his activist board. And it smells of well-aged vintage Deathwatch.
But before I get into Whitacre’s executive moves, you’re probably gathering I’m not buying “Big Ed’s” act, and you’d be right. After doing some digging around Whitacre’s previous executive life at AT&T, it’s easy to come away with a highly unflattering portrayal of GM’s “interim” CEO. First of all, the “aw shucks I’m just a country boy who has a few good ideas” persona is total bullshit. In his previous executive life Whitacre was known as an arrogant know-it-all who was never wrong, never listened to reasoned advice and who brought absolutely nothing to the table of his own on a day-in, day-out basis. Shocking? Hardly. Anyone who thinks The Peter Principle isn’t alive and well in corporate America today is kidding themselves.
As every salesmanperson knows, you’ve got to close the deal. It’s as simple as ABC. Always Be Closing. Looks like the only thing GM is adept at closing is dealerships. All deals to get rid of its unloved, neglected, and money losing brands have either been canceled, or are barely up in the air. From Opel to Saab to HUMMER. Yes, HUMMER. Haven’t we been told that that beast has long been foisted off on a formerly unknown Chinese company called Tengzhong? It hasn’t. And it won’t be for a while. If at all.
Fritz was and is an outstanding executive, and I’m very sorry to see him go. You can argue there never is a good time for any of this, but in this case, the timing is particularly inopportune… He guided General Motors through perhaps the most difficult period in its history. I think all of us were surprised and the whole General Motors team I think is genuinely saddened over what transpired
GM Marketing boss “Maximum” Bob Lutz eulogizes his erstwhile boss at the Los Angeles Auto Show [via DetN]. Historians of the Lutzian oeuvre should note that this quote represents MaxBob’s attempt at exercising “enormous skill in the non-answering of [Fritz-related] questions.”
Car guys know exactly what’s wrong with GM: car guys like them aren’t running the show. Otherwise, every Chevrolet, GMC, Buick, and Cadillac would look “great” (no need to be more specific) and dust the competition. Hence Bill Ford’s decision to hire Alan Mulally to take over as CEO came as a real disappointment. Obviously, he would have done better hiring anyone who truly knows and loves cars better than a Lexus-driving Boeing executive.
Sorry, CarNut4CEO. It just wasn’t so in Ford’s case. And it’s just not so in GM’s case, either.
GM sources speaking to Bloomberg say that Ed Whitacre has told employees that he could stay in the position of CEO for as long as a year. During a 30 minute broadcast to GM’s staff, Whitacre said that the search for Fritz Henderson’s replacement could take as little as a several months, but that he was prepared to stay on as CEO for as long as a year. Whitacre reportedly also said that there were no further firings planned. [Hat Tip: Tex Lovera]
Recently, it’s become popular to believe that when a zombie loses its head, it dies. With today’s resignation of Fritz Henderson, the reanimated corpse of General Motors is testing that theory. Henderson was the latest in a line of GM lifers to hold the company’s reigns, hand-picked by ousted CEO Rick Wagoner and put in place by a presidential task force that couldn’t say no to another insider. In theory, Henderson’s resignation shouldn’t come as a surprise, let alone a disappointment. In practice though, the move leaves the zombie GM in a precarious position at a challenging moment. For the first time since (your guess here), GM is in the hands of an outsider.
What happens on Facebook is not private, kids. A picture may be worth a thousand words, but the right screencap can be worth a a few million. Ms Henderson’s anger is understandable, but it also makes it difficult to discern the amount of real truth in her words. In any case, this might confirm a few suspicions that Henderson’s departure was not an entirely well-planned, or mutual decision. Or, it might just make you a little sad. Either way, Ms Henderson’s version of the truth is out there now.
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GM’s board accepted Fritz Henderson’s resignation today, and its Chairman Ed Whitacre will serve as CEO until a replacement is found. A search for a new President/CEO will begin immediately. Whitacre took no questions, saying the day had been “hectic.” A spokesman said the resignation was a decision reached mutually by Fritz and the board, based on the company’s “current position.” The spokesman refused to answer further questions about the leadership change, prompting one journalist to ask why GM hadn’t simply issued a release, rather than calling a conference. “This is stupid,” he said. The spokesman revealed that the government “was notified after the board’s decision,” and referred questions of hiring practice to the federal paymaster, Kenneth Feinberg. Otherwise, there are no real answers coming out of today’s statement and brief question-and-evasion period. Whitacre’s statement is after the jump.
Breaking, via the AP. We are currently listening to muzack waiting for GM’s press conference to begin. [Hat Tip: Tex Lovera]
The Freep is reporting that GM’s Renaissance Center headquarters could be at risk if so-called “retention tax credits” aren’t amended. GM is consolidating more of its workforce at its Warren Technology Center, and 1,500 of the RenCen’s 4,000 GM workers are reportedly making the move out of downtown. The remaining 2,500 workers would stay only if a Michigan Economic Growth Authority “retention” tax credit makes it worthwhile. The necessary amendments to this tax credit have been made, but MEGA still has to approve the package. A memo to the Growth Authority reveals the stakes:
2,500 is the maximum that they can also take for this portion of the credit. General Motors has submitted an application stating that the headquarters is at risk without this credit.