AP Auto Writers
DETROIT (AP) --
Kettering University President Robert McMahan was traveling in China a
few months ago when he bumped into one of the university's board members
at an airport in Shanghai.
Mary Barra, the busy
global product development chief at General Motors Co., might have just
said hello and turned back to her phone. Instead, she had a long
discussion with McMahan's teenage son about his education and his
efforts to learn Mandarin.
"I turned to my son
after she left and said, `I put a month's pay on the fact that you just
met the next president and CEO of GM,'" McMahan said. "Even he, as a
16-year-old, was impressed by her approachability."
McMahan can keep his
pay. On Tuesday, GM's board named Barra, a 33-year company veteran, as
its next CEO, making her the first woman to lead a major car company.
Barra replaces Dan Akerson, who moved up retirement plans by several months to help his wife, Karin, battle advanced cancer.
When Barra starts her
new job Jan. 15, she will lead a company that's made nearly $20 billion
since emerging from bankruptcy in 2010, much of it from the cars and
trucks she helped develop. But she still faces challenges of paring down
GM's costs and winning over buyers in international markets such as
India and South America.
Akerson, 65, said he
had planned to stay at least until spring, but his wife's diagnosis
changed that. He said the board unanimously picked Barra from several
internal candidates because of the breadth of her experience, her
management record, her people skills and her understanding of GM's
operations.
"This is an executive who has a vision of where she wants to take the organization," he said.
Since February 2011,
Barra has held what many say is the most important job at GM. She joined
the company in 1980 as an engineering student at Kettering - then known
as General Motors Institute - and became a plant manager, executive
director of engineering and head of human resources.
Along the way, she
earned a reputation as a manager who made tough decisions, yet was able
to get people to follow her lead and work as a team, according to
current and former GM executives. Noting her talent, GM sent her to
Stanford University to get an MBA.
The 51-year-old
executive has been in charge of design, engineering and quality for all
GM vehicles and has shepherded most of the company's recent new vehicle
introductions. Under her command, GM rolled out brawny new full-size
pickup trucks, the Chevrolet Silverado and GMC Sierra, and the Chevrolet
Impala full-size car, which earned the highest score for a sedan in
testing by Consumer Reports magazine.
During her tenure,
GM's quality scores rose in surveys done by J.D. Power and Associates.
She also streamlined the organization, eliminating positions and putting
one engineer in charge of each vehicle.
"I don't see any
reason why she won't be a huge success," said Ed Whitacre, a former CEO
and chairman who promoted Barra to head human resources.
Akerson hinted at
Barra's promotion earlier this year when he told a women's business
group in Detroit that a "car gal" would someday run one of the Detroit
Three automakers. But he made it clear Tuesday that she wasn't picked
because she's a woman.
"Mary's one of the most gifted executives I've met in my career," he said.
Among Barra's biggest
tasks is executing plans designed to cut costs and putting out better
products, Akerson said. One big step in getting there: making more
vehicles off the same underpinnings, or platforms, that can be sold in
multiple markets, like the Chevrolet Cruze compact car.
In 2009, GM had 30
different vehicle platforms, adding to manufacturing complexity and
cost. Under Barra's leadership, it's moving to build nearly 90 percent
of its cars and trucks off five or fewer platforms by the end of this
decade, Akerson said.
In an October
interview with The Associated Press, she said GM is also moving to build
vehicles with more common parts to trim costs where customers won't
notice.
As product development
chief, Akerson challenged Barra to bring vehicles to market faster. She
responded with swift introductions of the Cadillac ATS, a BMW 3-Series
competitor, and the Impala. When the midsize Chevy Malibu didn't sell
well, Barra's team gave it new looks, more interior space and a new
engine with better gas mileage - all in less than a year.
"She is polished,
soft-spoken, invariably polite, but firm and goal-focused. She will have
a learning curve, but will be an excellent CEO," said Bob Lutz, a
retired GM vice chairman who once led product development.
Barra grew up near
Pontiac, Mich., in a car-oriented family. Her father was a die maker who
retired from GM after 39 years. GM's previous two CEOs, Akerson and
Whitacre, came from outside the auto industry and lacked the experience
that Barra has, said Erik Gordon, a professor at the University of
Michigan's Ross School of Business.
"There's nobody with
more years of honest `car-guy' credentials than she has," Gordon said.
"She's the one to do the breakthrough."
Akerson took over GM
in September 2010, as the company prepared to return to the public stock
markets. During his tenure, GM has made billions of dollars in profits
and is sitting on $26.8 billion in cash. Its profit margins in North
America are healthy.
Akerson had been
waiting for GM to officially shed the derisive moniker of "Government
Motors" when the government sold the last of the GM shares it got as
part of a bailout in 2008 and 2009. That happened Monday, clearing the
way for the Barra announcement.
The GM board also
decided to separate the positions of chairman and CEO. Barra gets a
board seat, but director Theodore Solso will succeed Akerson as
chairman. Solso, a GM board member since June 2012, is the former
chairman and CEO of engine maker Cummins Inc.
