GM Shakes Up Executive Structure Again, Commences Compact Recall
DETROIT — Coming on the heels of a recall of more than 1 million vehicles, General Motors shuffled more than a dozen top executives into new roles and responsibilities on Tuesday, prompting Mark Reuss, the GM North America president, to stress that now this arrangement is "my team."
Among the wide-sweeping changes are dividing teams of executives who will focus separately on marketing and sales. Reuss emphasized several times during a conference call following the announcement Tuesday afternoon that the entire reorganization plan is geared to sharpen the path between dealers, consumers and his position.
"It's been really clear to me since taking this role that there's a better way to structure and simplify this organization. As you walk through this new structure, you can see the changes are pretty logical for accountability and performance. North America needs to be built as a focused standalone business unit, and that's what we're doing," Reuss said.
"I know we've been making a lot of changes, but these are the changes that are necessary to have GM North America move faster and win. This is my team, hand-picked and put into place to win. People can focus their expertise on their brand, be it Cadillac, Buick-GMC or Chevrolet, rather than splitting people's time and attention in too many different directions," he continued.
"We need change agents. It's not a tear up and it's not a headcount reduction at all. … In short, it's a sleeker way to do business and be measured on the business we do. No one can argue with that concept," Reuss added.
New Sales Structure
Within GM's new sales organization are three brand executives who will report directly to Reuss. That contingent includes:
—Alan Batey now is vice president of sales and service for Chevrolet. Batey was most recently president and managing director of GM's Holden operations in Australia. A replacement for Batey will be named at a later date, GM said.
—Brian Sweeney will remain with Buick-GMC as U.S. sales and service vice president.
—Kurt McNeil now is U.S. sales and service vice president for Cadillac. McNeil was previously general sales manager at Chevrolet. The previous head of Cadillac, Bryan Nesbitt, is returning to a role in design, reporting to Ed Welburn, the vice president of global design.
Yet another executive reporting directly to Reuss will be Steve Carlisle, who has been appointed vice president, U.S. sales operations, responsible for dealer network, retail sales support as well as fleet and commercial sales.
Senior executives reporting to Carlisle to be responsible for their respective functions include Jim Bunnell, general director, network support; and Brian Small, general manager of fleet and commercial. GM indicated that a general manager for retail sales support will be named at a later date.
Carlisle was most recently executive director, GM South East Asia Operations, and president and managing director of GM Thailand.
GM indicated that Carlisle will be replaced by Martin Apfel, who will report to Tim Lee, president of GM international operations. Apfel was most recently executive director of global manufacturing and planning.
New Marketing Structure
Meanwhile now reporting to Reuss will be Susan Docherty in her new role as vice president of U.S. marketing. She will no longer have sales duties.
Three other executives have been delegated to be responsible for the marketing of their respective brands. That contingent includes:
—Jim Campbell, U.S. marketing vice president of Chevrolet.
—Don Butler, U.S. marketing vice president of Cadillac who rejoins GM from INRIX.
—John Schwegman, U.S. marketing vice president for Buick-GMC who most recently was the Chevrolet product marketing director.
"What we're doing here is we're elevating the importance of marketing to senior people who have a lot marketing experience," Docherty stressed.
"There were a lot of people in the company who were touching the functioning of marketing. We're trying to create a marketing powerhouse on all these four brands that supports selling more vehicles," she continued.
Other Key North American Organizations
Reuss revealed a trio of new appointments for executives who also now will report directly to him. Those announcements include:
—Chris Preuss, vice president and president of OnStar who was most recently vice president of communications reporting to chairman and chief executive officer Ed Whitacre. Preuss succeeds Walt Dorfstatter, who will assume an executive director role in global product operations. GM said a replacement for Preuss will be named at a later date.
—Kevin Williams, president and managing director for GM Canada who most recently was responsible for leading service and parts operations. Williams succeeds Arturo Elias, who will take a position in the company's public policy center and report to John Montford, senior advisor of public policy.
—Steve Hill, general manager of GM customer care and aftersales, the department GM rebranded for its service and parts operations. Most recently, Hill was general manager of retail sales support.
Meanwhile, Reuss also noted that three other executives will continue in their current positions:
—Grace Lieblein, president and managing director of GM de Mexico.
—Diana Tremblay, vice president of manufacturing and labor relations.
—Chuck Stevens, chief financial officer for North America.
One other executive mention from Reuss was Mary Sipes. He said she will return to portfolio planning as executive director of North American product planning. Reuss indicated that this department is a key interface to the global engineering and product development organizations. In this position, Sipes reports to Jon Lauckner, vice president global product planning. Sipes was previously executive director, corporate planning.
Reuss shared during the conference call that he worked with a handful of key GM executives to formulate this new leadership plan. He pointed out that he shared the strategic maneuvers with Whitacre and the automaker's board of directors before making his announcements.
"We have taken the opportunity to put really bright minds in strategic fits into these key roles. We need people who can move with speed and decisiveness and also are creative and understand the customer," Reuss stated.
"I could see as clear as day that the mix and the structure of the people just wasn't right and what GM needed right now. That's why I moved to change things. If we are going to be successful in North America, we had to find people exactly right for these jobs," he continued.
"I know GM has made several rounds of changes in the past year. We all know it's been a tough time for the company," Reuss went on to say. "Frankly, I've seen the movie too many times where the structure or the people feel wrong and we do nothing about it. Doing that right now would be awful. It would be me not doing my job that I was hired to do."
Recalls for Steering Issues
Earlier on Tuesday, GM announced a safety recall of 1.3 million compact vehicles to replace a motor in the power steering system. The units affected include:
—2005-2010 Chevrolet Cobalt.
—2007-2010 Pontiac G5.
—2005-2006 Pontiac Pursuit sold in Canada.
—2005-2006 Pontiac G4 sold in Mexico.
GM executives stressed that they told the National Highway Traffic Safety Administration about the voluntary recall on Monday after concluding an investigation that began last year. They went on to mentioned that NHTSA opened an investigation Jan. 27 into approximately 905,000 Cobalt models in the United States after receiving more than 1,100 complaints of loss of power steering assist, 14 crashes and one injury.
"After our in-depth investigation, we found that this is a condition that takes time to develop. It tends to occur in older models out of warranty," said Jamie Hresko, GM's vice president of quality. "Recalling these vehicles is the right thing to do for our customers' peace of mind."
"While greater steering effort under 15 mph may be required, if the customer experiences loss of power steering assist, it is important to note that the vehicle can still be safely controlled because the customer can still steer the vehicle," Hresko pointed out.
"When the condition occurs, both a chime will sound and a ‘power steering' message will be displayed," he emphasized.
The automaker also explained that plans for the remedy are being developed. Executives said customers will be notified when the plan is finalized.
Reaction to Recalls
Jack Nerad, executive editorial director and executive market analyst for Kelley Blue Book and kbb.com, shared his thoughts about this recall of GM vehicles in light of the ongoing issues regarding several units from Toyota.
"Timing can often be everything when it comes to releasing news, and so it was that the announcement of General Motors' voluntary recall of 1.3 million Chevrolet and Pontiac models came nearly simultaneously with the announcement that GM's sales were up a reasonably robust 12 percent in February, despite snowstorms that blunted sales in several Eastern and Southern regions during the month," Nerad pointed out.
"There was a time when a recall of 1.3 million vehicles would have been viewed as a serious black eye, but now, while it is not a badge of honor, it pales in comparison to the 8 million vehicles recalled by Toyota and is countered by GM's sales gain," he added.
Nerad gave even more context to how recalls are approached nowadays.
"Given the fact that the Toyota story is so dominant, it would not be surprising to see a flurry of recalls by other manufacturers trying to fly under the radar. And, some perspective on the recalls might be valuable," Nerad speculated.
"In GM's case, the power steering issue reportedly resulted in 14 crashes and one injury. In the context of 1.3 million vehicles, that is a tiny percentage of incidents," he noted.
"However, the big headlines are putting more doubt into consumers who already feel shaky about a potential big-ticket car purchase," Nerad concluded.