Car guy or bean counter? GM's Ammann takes to the track

Thu Jul 19, 2012 6:22am EDT
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Ben Klayman

DETROIT (Reuters) - Dan Ammann wants it understood he's not one of the gray-suited "bean counters" who once dominated, and nearly destroyed, General Motors.

To drive home the point, the chief financial officer is ready to challenge the automaker's resurgent "car guys" on their own turf: a three-mile test track where his gray-metallic Corvette Z06 reaches a blistering 150 miles per hour. Every lap is a message - this is not the same hidebound finance department that almost ran the top U.S. automaker into the ground.

"You have to have a point of view on how the organization actually goes about making cars," Ammann told Reuters. "You've got to be out there and really immerse yourself in the business before you can make a difference."

The 40-year-old, former Wall Street banker acknowledges GM has further to push to change a corporate culture once marked by arrogance, insularity and bureaucracy that has stifled the company for decades. And that's on top of such concerns as ongoing losses in Europe, slowing industry demand in China and GM's $134 billion in pension obligations at the end of 2011.

Some industry officials believe the issues are so entrenched the most likely scenario is GM never eliminates its underlying problems.

"They have not wrestled their management challenges to the ground," said Steve Rattner, the former head of the U.S. auto task force. "GM is making a lot of money. It's just not making quite as much as Ford on a percentage basis because it still has some inefficiencies that need to be wrung out."

Despite a record profit of $7.6 billion last year, GM's operating margin of 3.8 percent still trailed such rivals as Hyundai (10.4 percent), Volkswagen (7.1 percent) and Ford (5.4 percent).

The near collapse of GM and its U.S. government-led bankruptcy filing in 2009 put a spotlight on the failings of the finance team, which federal officials viewed as hapless during the reorganization.   Continued...

General Motors Chief Financial Officer Dan Ammann sits in a gray-metallic Corvette Z06 before driving it on the test track at GM's proving ground in Milford, Michigan June 25, 2012. REUTERS/Rebecca Cook