Soon-to-retire General Motors CEO Dan Akerson maintains that the U.S. government’s choice to bail out the Detroit giant saved money despite losses after the Treasury Department offloaded its remaining shares.
Yesterday, the National Legal Policy Center (NLPC) asked Akerson if GM would pay back the estimated $10 billion in losses from the government bailout. “I would not accept the premise that this was a bad deal,” Akerson said, emphasizing that the government chose to buy shares in General Motors rather than issuing a loan. Akerson will retire as CEO on January 15 to be replaced by GM veteran Mary Barra.
A study by the Center for Automotive Research released last week estimated that in 2009 alone, the bailout saved roughy $40 billion in lost federal revenue and about 1 million jobs. During a speech to the National Press Club yesterday, Akerson said the company’s history is riddled with mistakes.
“You could pick just about any point in time and find something to shake your head over. For example, in 1978 GM paid almost as much in benefits as it earned in net income,” he said. “Yet the very next year, it agreed to the largest pension increase in UAW history.
“We have been fixing the plane while it’s in the air.” That means sloughing off dead weight and Holden’s Australian manufacturing operations are only the beginning.
“…on the product front, we will reduce the number of vehicle architectures by half over the next decade,” he said.
Last week, GM announced a plan to pull Chevrolet from Europe in an effort to bolster its Opel and Vauxhall brands. Cadillac will continue to be sold there.
Discuss this story at our General Motors forum.