BREAKING: Ed Whitacre To Step Down As GM Chairman/CEO

GM Chairman/CEO Ed Whitacre just announced during GM’s Q2 financial conference call that he will step down as CEO on September 1, and as Chairman at the end of 2010. GM board member Dan Akerson will take over both of Whitacre’s position. Whitacre called Akerson “very involved” and said he expects a smooth transition. Whitacre planned to leave after “returning GM to greatness,” and says that “with a good foundation in place,” he’s ready to leave. The board’s been aware of Whitacre’s plan, and the board was ready to act when Whitacre said he was ready to step down. Akerson says he and Whitacre “share a vision” for GM, so instead of setting an agenda now, he’s focusing on a smooth transition. Akerson noted that Whitacre “had made some management changes” already, and he’s confident in his “deep bench.” The major transition, he says, “is me,” because he needs to gain a day-to-day, operational perspective on the business.

All told, Akerson, who was Head of Global Buyout for the Carlyle Group before joining GM’s board in July of last year, seems to not have a clear agenda developed for his leadership of GM. Whitacre, it seems, was but the hatchet man, and having shaken up management, Akerson seems content to keep GM rolling along the path that Whitacre has laid out. Like Whitacre, he does not have industry experience, and a transition period in which he becomes familiar with day-to-day GM operations seems inevitable. Whether he eventually takes GM in a new direction won’t likely be clear until he has at least assumed the CEO job, as he notes that “Ed is still in charge right now.”

Whitacre emphasized that GM’s board knew that he didn’t plan on staying, and yet no effort appears to have been made to find a CEO from outside the organization. Why Akerson was selected was not clear, other than that he allowed the board to make an easy decision and a smooth transition. Overall, the perception seems to be that GM is profitable and under control, and that settling into cruise control makes perfect sense at this point. With GM making money in a weak market environment, and with 30-40 percent more production capacity available without a strong ramp-up in fixed costs, there’s a certain case for this perspective. On the other hand, Opel and Daewoo are still in deep trouble, unfunded pensions loom, and GM’s North American fleet sales are clearly being boosted by incentives and daily rental fleet sales. Akerson is going to have to show something other than a caretaker’s perspective if GM’s turnaround is going to overcome these obstacles.