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Recently-reassigned Cadillac boss Bryan Nesbitt isn’t the only GM exec paying the price for weak Cadillac sales, as Automotive News [sub] reports that GM has terminated three other Caddy executives.
Cadillac’s Steve Shannon and John Howell were dismissed Monday, said eight sources familiar with the moves. Jay Spenchian, an executive director who worked on Cadillac and other brands, was also let go, the sources said.
Longtime GM executive and Cadillac sales manager Ed Peper will stay on at Cadillac, and will report to Kurt McNeil, who will take over as Cadillac’s head of sales and service. This is the second time Peper’s career has moved backwards in recent months: prior to becoming Cadillac’s sales manager, he had served as the general manager of the Chevrolet brand. More proof that it doesn’t pay to be a lifer in Ed Whitacre’s new GM.
What it does pay to be is a longtime friend and colleague of Whitacre’s. With GM lifers being purged right and left, Whitacre has reached into his past at AT&T to recruit his former PR boss Selim Bingol to take over as GM’s head of communications. Bingol will take over for Chris Preuss, who will be taking over GM’s OnStar business. Most recently Bingol had served as a Senior VP at GM roster agency Fleishman-Hillard. In GM’s release on the matter, Whitacre explains some of the benefits of hiring his phone-biz crony and former speechwriter:
Selim brings a wealth of experience to this position and his deep and diverse background will serve us well as we accelerate our efforts to design, build and sell the world’s best vehicles. I have worked with Selim over the years on several complex communication issues and he has my trust and respect.
One thing he doesn’t bring: knowledge of the car business, something Whitacre has admitted to struggling with. Of course, the PR side of the business isn’t quite as dependent on industry-specific experience, but the fact that Whitacre went with a former colleague adds to the growing perception that he is running GM as his personal fiefdom.
34 Comments on “GM Fires Caddy Execs, Hires Former AT&T PR Boss As Leadership Purge Continues...”
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These are all people who’ve been highly regarded in the past, when GM felt that Cadillac was doing well. I’ve enjoyed speaking with John Howell at NAIAS the past few years.
Some commenters at autonews.com blame the huge reduction in the dealer count for Cadillac’s drop in sales, and they’re probably partly right.
It’s also possible that the drop in sales is because Cadillac has exactly one competitive offering**, and that offering is at the entry-level.
So you buy a CTS and then…. what? The STS is about as remarkable a car as the Lexus GS or Acura RL, and not quite as good a car as the CTS. And then there’s the DTS (or, as it’s known, the Lucerne With Extra Bling) and the XLR (which should do better, but doesn’t).
I’d say Cadillac’s problem is that they’ve hit the wall, and inexplicably GM is throwing product at Buick instead.
** ok, I suppose if you count the Escalade they’ve got two.
And the 2010 Cadillac SRX makes three. They’re selling like crazy.
The SRX is not a bad car, but it’s not a class-leader like the CTS is.
CTS sales were down by 17 percent in February, so if it’s competitive, lots of people apparently don’t care. (Also note that the XLR is dead.)
I do agree with the dealer reduction theory, at least in part. For example, there was a Cadillac dealer in my hometown, and another in a town about 11 miles away. Both had been in business for years, and had decent reputations.
Yet GM yanked the Cadillac franchise from BOTH of them as part of its dealer purge. Maybe GM wants wanted a more exclusive dealer for Cadillacs (the dealers sell other GM marques), but a standalone luxury store simply is not feasible in these towns. There isn’t enough business.
psarhjinian,
The CTS as class leader? I dunno about that. Value leader in the class, maybe.
geeber,
In some e-conversation I monitored elsewhere, someone recently pointed out a combo Cadillac/Hyundai dealership. Yep, Hyundai will help pay the bills but it can’t be good for the Cadillac end of the business.
And Hyundais keep getting nicer and nicer. I have to wonder how often someone’s going to go to such a dealership to check out a Cadillac, sit in a Hyundai and realize he can save beacoup bucks without really giving up much.
The CTS is about the only Cadillac you can credibly recommend over most of the competition. There’s reasons (generally to do with flavour) that might steer you to a G35 or 3-Series, but the CTS is not a car that you need to excuse on the grounds of value (like the TL) or buy on the basis of badge despite inherent mediocrity (like the C-Class).
The problem is that it’s the only Cadillac that meets that qualification. The STS is an also-ran. The DTS is worse. The SRX is decent, but it’s compromised. The Escalade kind of a special case. And from what’s coming down the pipe (the XTS) this doesn’t look like it’s going to change.
The dealer slaughter was stupid, pure and simple. No manufacturer has ever improved sales by drastically reducing the number of store fronts selling their product.
If you can convince someone to buy AT&T, then you’re pretty dang good. I’m not a Whitacre fan by any means, but I can’t object to this.
Cadillac has some good cars, but they are almost BMW-ugly.
And – given GM’s non-existent quality history – I’d not pay German prices for Government Motors engineering.
I’ll take an unmodified Lexus anytime.
“… but the fact that Whitacre went with a former colleague adds to the growing perception that he is running GM as his personal fiefdom.”
No, no, no, no, no, no, no, no, no, no, no,no, no! Ok, maybe. But couldn’t it also mean that he wants to get rid of what he thinks of as deadwood and bring in execs he is both comfortable AND has confidence in? Would YOU feel confident about a lifer GM exec?
I know everybody is SO anxious to jump to a conclusion, but I’m willing to wait and see how this plays out before I jump on the “everything about Whitacre is bad” bandwagon.
At the risk of praising overpaid Whitacre, I would say that purging high level execs is exactly what GM should be doing right now. Of course, if they are all replaced by Whitacre’s AT&T cronies, it may not have the desired effect.
Plenty of people have felt over the years that GM’s top exec’s were pathetic. So why now the heartache over forcing them out? Just because a person hasn’t grown up in the auto business doesn’t mean that they can’t do the job. The real secret is who will be underneath these guys. Those are the people who really do the work anyway. If it’s people who have been shut down by the outgoing big dogs, then it might just work out for the best.
As far as Whitacre making GM a personal fiefdom, name me a GM CEO/Chairman who hasn’t?
+1
I’m not a big fan of Ed Whitacre, but in today’s auto industry, it’s time to perform or die.
Over the past five years, it seemed like Hyundai/Kia installed new N.A. management about every six months or so. Things are going well for them, even in this economy.
A job for life in GM management simply because you’ve been there is no longer possible. It can’t be. To my mind, that’s a good thing.
moedaman writes, “The real secret is who will be underneath these guys. Those are the people who really do the work anyway.”
True. And I would think that it’s demoralizing to be a top contributor and have an outsider come in. Might as well send a resume to Hyundai.
But like I said, if the people who will be doing the heavy lifting were being held back by the “clique” in charge. Then things should get better. Hell, it couldn’t get much worse than it got in the last few years.
I wouldn’t let half these executives sell used cars off the dealer lots. As for the other half, that’s about all they should be doing.
A bit more on Bingol – he has recently worked with Chevrolet
http://www.prweekus.com/pages/login.aspx?returl=/gm-replaces-preuss-with-fleishmans-selim-bingol/article/164983/&pagetypeid=28&articleid=164983&accesslevel=2&expireddays=0&accessAndPrice=0
In the past, GM was criticized for an insular top management team. GM now has a CEO from outside the auto industry and outside of GM. The new CEO did not immediately restructure the leadership team. Rather, Whitacre learned who was doing what and how well. Now it is time to push non-performers out and bring in new leaders with different perspectives to balance with GM lifers who are getting positive results.
IMO, I think it is a stretch to say “knowledge of the car business, something Whitacre has admitted to struggling with.” He admitted to not knowing about the car industry. But he and the rest of the board of directors have been busy learning about it without struggling with it.
As a GM employee, I have a vested interest in seeing GM succeed. I am going to reserve judgement until I see results one way or the other from Whitacre and his leadership team.
So long as the outside replacements are capable individuals I don’t view it necessarily as a negative that they lack automotive experience. Mulally would be the poster boy example of that.
What good did all the automotive experience GM has/had do them?
Whitacre in ridding GM of its upper mgt. lifers is IMO what must be done if they’re going to have any chance of success.
If anybody ever needed a speech writer it’s Whitacre.
“If anybody ever needed a speech writer it’s Whitacre.”
Hundreds of rattlesnakes lost their heads to a shovel on Big Ed’s Texas ranch for less than that.
Jay Spenchian was one of the few leftovers from the failed days of Ron Zarella. I’m suprised he lasted this long.
My father has a 2007 Cadillac CTS with the base 3.6 litre V6. He loves it. I have to say, it’s a nice looking car with decent power. It’s up on it’s lease and we took a 2010 CTS out for a test drive. This one had the 3.0 litre V6 base engine. What a disapointment it was. The car seemed large and ungainly to drive. Although the 3.0 litre is rated at 270 HP, the car seemed to have no low or midrange power. The current car he has is only rated at 255 HP but is much quicker. I did some more research. The new 3.0 litre has 15 more horepower, but only 223 footpounds of torque. This is less torque than the 3.6 litre in the 2007. Also, the 2010 weighs over 4000 pounds, albeit with all wheel drive. The 2007 is rear wheel drive. I believe the 2007 is about 300-400 pounds lighter. This along with torque makes up for the difference in power in my opinion. Yes there is a 304 HP version available, but it’s more expensive, and we were comparing base versions. The CTS is suppose to be the best model they make, but I see the 2010 version as being a step backwards in styling and performance.
Yea, that 3.0L V6 is a steaming pile.
Here’s a power curve comparison for the 2009 non-DI 3.6L CTS and the 2010 3.0L CTS. As you can see the 3.6L beats up on it until about 6200RPM. How much time do people spend that high on the tach?
The 2010 mid-level “FE2” suspension package also got de-contented this year.
If I was your father, I’d look for a ’09 CTS.
Interesting power/torque curves. The 3.6l is much more fitting with the expected Cadillac driving experience than the 3.0l is. Once upon a time, every engineer and manager at GM/Cadillac would have known that!
Don’t EVER discount or sell Big Ed short. There’s a reason AT&T is kicking Verizon’s ass. He laid the groundwork for the network evolution that is underway.
This fool will go the same way as Wagoner. In fact Whitacre is Wagoner without the basic knowledge of the car industry. Cadillac was simply marketed to the wrong people. I knew they were done when they cancelled the replacement for the Northstar.
Wasn’t it Whitacare that lead AT&T to a last place finish on the JD powers customer satisfaction survey?
Even Apple wants out with their deal with ATA&T concerning the IPHONE.
So now GM is going back to brand marketing by hiring people that have no experience in the auto business.
“Wasn’t it Whitacare that lead AT&T to a last place finish on the JD powers customer satisfaction survey?”
A: That is not a truthful contention. I smell a rat.
“Even Apple wants out with their deal with ATA&T concerning the IPHONE.”
A: What were the terms of the agreement (e.g., length of “exclusive rights” deal) T had w/Apple re: the iPHONE? Bet you didn’t know the answer to that before you made that spurious statement.
I smell a rat and it is heading GM. Even with Toyota in its weakened state GM still won’t improve market share. At the next board meeting they should elect a roll of toilet paper as the next CEO of GM. It would not make a difference!!!
What pile of garbage GM has become.
Let’s now call them BM!
Who cares which big shot is in charge of Cadillac’s communications or marketing? I’m wondering who was/is responsible for “the standard of the world” getting all those black dots on Consumer Reports’ reliability reports. S/he should go if that hasn’t happened already. Poor reliability in a luxury sedan is unforgivable.
Simple math lesson for both GM and Cadillac.
Less dealers = less sales.
“The simplest explanation that explains all the data or strategy tends to be the best one”
– Occam’s razor
“Less dealers = less sales.”
GM’s per dealer sales have been far below Toyota and Honda for quite a while.
Doesn’t seem to hurt Hondota.
It is true that Toyota and Honda have traditionally sold more vehicles per dealership than GM has. HOWEVER, it does not necessarily follow that reducing the number of GM dealers would result in more business for those GM dealers who remain.
For example, our town used to have one Ford dealer and one Chevy dealer. The Chevy dealer closed. Do you think that means that the potential Chevy buyers who would have bought locally are now going go out of their way to the next town north or south to buy a Chevy? Some will, and some just won’t bother with Chevy anymore.
And now for the icing on the cake: The currently empty, but less than 10 year old deluxe Chevy dealership … is about to reopen as a Honda dealer. New operator, same building. The Honda dealer was able to get the facility for a fraction of replacement cost. How exactly does all of this result in an upside for GM?
Trust me, getting your execs from ATT’s labor pool doesnt thrill me. ATT management suffers from the old boy network too.
“Trust me, getting your execs from ATT’s labor pool doesnt thrill me. ATT management suffers from the old boy network too.”
Your flippant assertion flies in the face of much industry recognition of the diversity of AT&T’s executive management, which includes several awards from minority organizations.