GM's Fritz Henderson Resigns

Board Chairman Ed Whitacre will head the company until a new CEO is found. Apparently, Fritz Henderson was too much part of the old gang.

It's a New Day for the New GM

Fritz Henderson speaks on the new GM, which has emerged from bankruptcy. Customer, cars and culture are the top priorities for the New GM. The car company is starting a Tell Fritz website to get input from customers:

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The New GM to Emerge July 10

Check out the GM blog and the GM reinvention site.

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The new General Motors is about to roll off the assembly line as a leaner, greener model, maybe even a profitable one, too.

Once the world's largest and most powerful automaker, the troubled company was expected to emerge from bankruptcy protection by early Friday cleansed of massive debt and burdensome contracts that would have sunk it without federal loans.

The new company, 61 percent owned by the U.S. government, will clear bankruptcy in record time to face a brutally competitive global automotive market in the middle of the worst sales slump in a quarter-century. Read the rest at NPR

Kenneth Feinberg is the New Pay Czar

The Obama administration on Wednesday appointed a compensation overseer with broad discretion to set the pay for 175 top executives at seven of the nation’s largest companies, which have received hundreds of billions of dollars in federal assistance to survive.

The mandate given to the new compensation official, Kenneth R. Feinberg, a well-known Washington lawyer, reflects the federal government’s increasingly intrusive role in the corporate affairs of deeply troubled companies. From his nondescript office in Room 1310 of the Treasury building, Mr. Feinberg will set the salaries and bonuses of some of the top financiers and industrialists in America, including Kenneth D. Lewis, the chief executive of Bank of America; Vikram S. Pandit, the head of Citigroup, and Fritz Henderson, the chief executive of General Motors.

The compensation of executives at some companies receiving aid provoked a firestorm of political outrage earlier this year. In revising a previous proposal to set pay limits, the administration has decided to take an approach that will leave the success or failure of the effort to curtail high compensation at the assisted companies in the hands of Mr. Feinberg. (Mr. Feinberg himself will not receive any government compensation.) Read more at NYT

Feinberg's bio:

Kenneth R. Feinberg has been key to resolving many of our nation's most challenging and widely known disputes. He is best known for serving as the Special Master of the Federal September 11th Victim Compensation Fund of 2001, in which he reached out to all who qualified to file a claim, evaluated applications, determined appropriate compensation, and disseminated awards. Mr. Feinberg shared his extraordinary experience in his book What Is Life Worth?, published in 2005 by Public Affairs Press. Just a few years later, Mr. Feinberg became Fund Administrator for the Hokie Spirit Memorial Fund following the tragic shootings at Virginia Tech. Mr. Feinberg also has served as Special Master in Agent Orange, asbestos personal injury, wrongful death claims, Dalkon shield, and DES (pregnancy medication) cases.
Mr. Feinberg founded Feinberg Rozen, LLP in 1992. He has been involved in resolving thousands of disputes involving a wide range of interests and clients. In the commercial sector, Mr. Feinberg designed, implemented and administered an ADR settlement Program involving Liberty Mutual Insurance Company, Zurich N.A. Insurance Company and Hurricane Katrina and other Gulf hurricane claimants. He also has served as Distribution Agent for AIG Fair Fund claimants, and has been the Fund Administrator for a variety of claimant funds totaling more than $1 billion. In his capacity as an arbitrator, Mr. Feinberg helped determine the fair market value of the original Zapruder film of the Kennedy assassination, and legal fees in Holocaust slave labor litigation.
Mr. Feinberg has been appointed to two presidential-level commissions because of his experience and expertise, and has had a distinguished teaching career as an Adjunct Professor of Law at Georgetown University, the University of Pennsylvania, Columbia University, New York University, and the University of Virginia.
In 2004, he was named "Lawyer of the Year" by the National Law Journal (2004), and has been named repeatedly as one of "The 100 Most Influential Lawyers in America" by the National Law Journal.
Education: B.A., cum laude, University of Massachusetts, 1967 J.D., New York University School of Law, 1970, (Law Review)
Clerkships: Chief Judge Stanley H. Fuld, New York State Court of Appeals 1970-1972
Leadership: Chairman of the Board of the RAND Institute of Civil Justice Vice-Chairman, Board of Human Rights First Board, Bazelon Center for Mental Health Law

Read the Treasury press release outlining the details here.

Fritz Henderson on the New GM Video

Critics on the left and right aren't giving GM much longer to live, despite the Obama administration's efforts. Economist Robert Reich says the Obama administration is allowing GM to live for only the short term. See the new GM site here. 
Ralph Nader is complaining too. Everyone's got their agendas and I'm not even going to pretend that I know what will happen to GM but I'm hoping that Fritz Henderson is the kind of guy who likes to prove people wrong:

Henderson's CNBC interview:

Ralph Nader is mad:

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Henderson's interview with Bloomberg:

Fritz Henderson On Meet the Press April 5 Video

Fritz Henderson makes $1.3 million a year. His salary was cut. I know some CEOs make much more but anything above $750,000 seems exorbitant to me, especially for a guy who worked at such a lame company. I wouldn't buy a GM for that reason alone.

I don't know why the auto task force decided to keep Fritz but it seems to me they should ALL go. A brand new creative thinking team should be brought in. Perhaps Fritz will just be the turnaround guy, who will leave once the company's on its feet. None of this makes sense to me because auto workers' jobs aren't even being saved.
Fritz says trust me:

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GM May Be Stripped to Chevy and Cadillac

GM's new leader Fritz Henderson could kill six brands, whack dealers, and cut thousands of more employees. GM is replacing 6 board members.

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Fritz Henderson is now calling the shots.

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Fritz Henderson To Take Over GM

Henderson, who is COO, will take over, at least in the interim.

An administration official confirmed that Mr. Wagoner was asked to step down to make way for ongoing restructuring within the company. Mr. Wagoner will be replaced, at least on an interim basis, by Frederick "Fritz" Henderson, the company's chief operating officer.

Mr. Wagoner was asked to step down on Friday by Steven Rattner, the investment banker picked last month by the administration to lead the Treasury Department's auto-industry task force. Mr. Rattner broke the news to Mr. Wagoner in person at his office at Treasury, according to an administration official. Afterward, Mr. Rattner met one-on-one with Mr. Henderson, who will fill in as GM's CEO.

GM didn't immediately return calls for comment. One longtime GM board member, Kent Kresa, declined to comment when reached by phone Sunday night. WSJ

Tomorrow:

In remarks Sunday, Mr. Obama said that he intends to extract "a set of sacrifices from all parties involved -- management, labor, shareholders, creditors, suppliers, dealers." The industry, he said on CBS's "Face the Nation," must "take serious restructuring steps now in order to preserve a brighter future down the road." The two companies "are not there yet," he added.

Mr. Wagoner's removal shows that the sacrifices could cut deep. The departure of the company's top executive promises to further shake up a company that has already been through considerable change over the past six months. The 56-year-old executive had been scrambling to craft a global strategy aimed at maintaining leadership in the global sales chase with Toyota Motor Corp., and making big profits in emerging markets.

But Mr. Wagoner's plans came crashing down in the second half of 2008 as the company ran short of cash and was forced to ask the federal government for tens of billions of dollars in aid. At the same time, his executive team started dismantling several parts of the company, including a plan to shed several U.S. brands, slow the pace of new-product introductions and sell off stakes in international operations. WSJ

Katie interviews Fritz:

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