In a email, Akerson told employees that even after the government fully exits the company, GM must continue to change to avoid ever having to go through anything like the 2008-2009 auto bailout again.
DETROIT, MI- General Motors Co. knows it’s going to take time to shake its “Government Motors” persona, and CEO and chairman Dan Akerson believes the company is ready for that challenge.
In a email posted by the Detroit Free Press, Akerson told employees that even after the government fully exits the company, GM must continue to change to avoid ever having to go through anything like the 2008-2009 auto bailout again.
“As today’s news travels around the world, the question will be asked, ‘Did GM truly learn the lessons of the bankruptcy?’ Our results show that we are changing the company so we never go down that path again,” Akerson wrote.
The email was in response to the Detroit-based automaker and the U.S. Department of Treasury announcing plans for the government to fully exit GM by March 2014.
The $5.5 billion deal includes GM purchasing 200 million shares of stock from the U.S. Treasury for $5.5 billion.
After the repurchase, the U.S. Treasury will continue to own approximately 300 million shares of GM stock, or approximately 19 percent of the automaker, which it plans to start selling as soon as January 2013.
General Motors Chairman and CEO Dan Akerson listens at a news conference at the start of national contract negotiations at the General Motors Hamtramck Assembly plant in Hamtramck, Mich., Wednesday, July 27, 2011. Akerson said the company's European car business, Opel, is not for sale.Akerson said after the government's planed exit, GM must continue to work hard to regain its former greatness.
"The next steps for us are clear: Stay disciplined financially and operationally, sharpen our focus on the customer and continue to play offense with new products," he said in the email. "The better we do in each of these areas, the closer we’ll come to achieving our full potential and earning a place once again among the most admired and profitable companies in the world."
GM, or "Government Motors" as some critics have called it, has continually been ridiculed due to the government ownership, which was the result of the auto industry bailout that began under President George W. Bush in 2008 and which was expanded by President Barack Obama in 2009.
Akerson said GM has learned numerous lessons "from the extraordinary government assistance," including how important it is to have a fortress balance sheet and a low break-even point; and how important strong relationships are with its suppliers, dealers, employees, customers and the communities where we do business.
“More than anything else, we are learning to be humble and to genuinely appreciate every customer,” he wrote. “These traits are hallmarks of all great companies, and I’m proud of the way this team has redoubled its efforts to design vehicles that people love, deliver quality that endures and provide service that builds loyalty.”
Akerson also said there are some who will still doubt the automaker’s ability to change, but he believes “can regain their confidence over time by making GM even more successful than it is today.”
Since the $85 billion auto bailout, which forced GM and Chrysler into a government-backed bankruptcy, the automotive industry in general has continued to drive toward pre-recession levels.
GM alone has recorded record profits, and announced investments of more than $7.3 billion in the U.S. and created or retained more than 20,000 jobs.
Click here to read Akerson's full email.
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