WASHINGTON — General Motors CEO Dan Akerson said Friday that while there won't be any raises for management in 2011, he hopes the U.S. Treasury Department will let the company provide better pay to keep some executives from leaving.
In a speech to the Economic Club of Washington, Akerson said GM is well-positioned for the future with vehicles like the Chevrolet Volt, but that he still has worries, including how the company would react if oil prices rose with sales on the way up.
He is also worried about losing employees, saying, "We're starting to see that now." While in Washington, he said, he planned to meet with Treasury officials to discuss getting "some relaxation" to strict rules setting executive compensation under the Troubled Asset Relief Program that lent the company some $50 billion to help it survive a quick trip through bankruptcy restructuring.
After the speech, Akerson declined to provide reporters with any additional details on who could be leaving or what sort of latitude he's asking for. In September, Kenneth Feinberg, who had served as special master for executive compensation, approved a $9 million annual compensation package for Akerson, including stock and salary.
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David Rubenstein, who worked with Akerson when both were managing directors at the private investment fund the Carlyle Group, introduced him Friday and said repeatedly that Akerson walked away from a lot of money to take the GM job.
Akerson said he did it because he believed GM was too big and too important to the American economy to fail.
"There's more to life than money," he said.
He took over as the head of GM in August and guided it through an initial public offering last month that returned about $23 billion to the government, reducing the Treasury Department's stake in the company from more than 60 percent to about 33 percent.
Akerson said that while he has been criticized by some for not being a "car guy" before coming to GM, he has tried to bring a more intellectualized process to company decisions, hoping to change the culture and simplify what had become a complex supply and product structure. Labor costs are now competitive with other automakers, foreign and domestic, he said, and the success of the IPO shows that people are willing to bet on GM again — which was almost unthinkable a year ago.
He worries, however, that some in the company — looking at the fact that the company emerged from bankruptcy in only 39 days, has returned a good portion of the government's money and is once again profitable —"view it as a bad storm that passed," while there remain great challenges. New products are coming on line, he said, and the company must continue to shed debt. A plan for dealing with other market forces — like gas prices — is needed.
But he noted that the company is positioned well globally and could make almost as many vehicles in China next year as it does in the U.S. He also said there is a chance that the plug-in hybrid electric Volt — which will be available commercially in some markets, including Washington this month—could change the way America views the automobile.
Remembering the flak auto executives took in 2008 when they flew in company jets to Washington to ask for help, Akerson started his speech by assuring everyone he flew to Washington from Detroit on a commercial flight.
"I'm not that dumb," he said.