David Welch - Charging Ahead: GM, Mary Barra, and the Reinvention of an American Icon

2022 David Welch

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On December 10, 2013, at 8:46 a.m., Bloomberg News, in a 1,000-word first draft, informed the world of the biggest business scoop of the year: Mary Barra, whose career began on the factory floor as an intern, would succeed Dan Akerson as chief executive officer of General Motors Co., the first woman CEO in the global automotive industry.

The extent to which Bloomberg owned the story was revealed in the ensuing edition of Bloomberg Businessweek, featuring Barra posed with arms crossed in a black-and-white portrait taken the same day, according to an editors note, and with The New General plastered in blue block letters on its cover.

While the world was surprised to learn a fifty-one-yearold woman engineer was the winner over three men (president of GM North America, chief financial officer, and vice chairman), each of whom seemed probable successors to Akerson, Bloomberg was prepared to anoint Barra because its reporters and editors were three years into the twenty-threeyear-old news organizations Women Initiative, attempting to narrow gender imbalance in coverage and, especially, its own newsroom. The focus on women protagonists and their voices brought Bloomberg News closer to Barra than it otherwise would have been.

Twelve months earlier, Bloomberg Television anchor Matt Miller was at the 2013 North American International Auto Show in Detroit asking Barra about the Cadillac ATS compact luxury sedan as North American Car of the Year and about the luxury-car market. In March, Barra and Miller discussed GMs products for the Chinese market at the New York International Auto Show. These interviews and several others that followed during the year encouraged our thinking that Barra would emerge as the front-runner to succeed Akerson.

When Akerson showed up at a Bloomberg new office celebration in Southfield on June 17, he did nothing to discourage the possibility that a woman would run GM someday. Thanks to him, Barra was GMs first female chief product officer, the job historically known as the No. 1 car guy. Akerson had already hinted during a Wall Street Journal forum on women executives in 2012 that Barra could advance if GM profitability improved. It had by the time he could chat with us about the layout of our newest newsroom.

By August, Bloomberg Businessweeks David Welch reported in a Bloomberg News Cars column that at least four executives were contending to lead GM amid anticipation that Akerson would retire within three years. But Barra and North America president Mark Reuss were the only names mentioned in the piece. A month later, Akerson signaled change was coming.

The Detroit Three are all run by non-car guys, he said in Detroit. Someday, there will be a Detroit Three thats run by a car gal.

Barra proved to be fearless and farsighted in ways even Alfred Sloan would admire, not least of all because she questioned everything GM did, including the relevance of the global empire he built. That was revealed for the first time in September 2019 by Welch and Bryan Gruley in the Bloomberg Businessweek feature Mary Barra Bets Big for GMs Electric, Self-Drive Future.

There was a point in time where we were everywhere for everyone with everything, she told the reporters in an interview at her downtown Detroit office. We had to say, OK, where are we deploying capital thats not generating appropriate returns? Once you start to believe in the science of global warming and look at the regulatory environment around the world, it becomes pretty clear that to win in the future, youve got to win with electric and driverless vehicles. This is what we really believe is the future of transportation.

Here is that story from Bloomberg News Detroit Bureau Chief Welch. He began covering the auto industry for BusinessWeek in 1999, and he proves in this beautifully told tale of redemption for the once great symbol of American manufacturing that luck begins when preparation meets opportunity.

Matthew Winkler

Cofounder and editor-in-chief emeritus

Bloomberg News

Its not even three months into Mary Barras tenure as chief executive officer of General Motors in April 2014 and already shes having one of the worst weeks of her career. Shes in Washington to sit before a congressional panel, where a subcommittee is set to grill the new CEO about a faulty ignition switch that had been linked at that point to thirteen deaths. The infamous switch in GMs Chevrolet Cobalt compact car tended to slip into the accessory position while driving, cutting power to the engine and airbags as well as the power breaks and power steering.

The crisis exploded on January 31, just two weeks into her tenure. GM first announced that it needed to recall 778,000 cars because of the bad switch. The number quickly grew to 1.6 million, then 2.6 million. Early on, GM North America president Alan Batey publicly apologized, and the company advised its customers that the switch could turn off while in the drive position if the key is on a key ring that was laden with heavy items. The explanation also came off as flimsy, almost blaming car owners who might have had a monstrosity of trinkets and keys on their keychains. As ridiculous as these keychains look, with rabbits feet, fuzzy dice, and other tchotchkes attached to clattering rings of keys, people do that all the time.

More details came to light courtesy of plaintiffs attorneys who were suing the company. The narrative that was unfolding would soon de-pants GM. Lawsuits revealed that company engineers and attorneys knew the switch was problematic for more than a decade and never issued a recall. One manager nixed a remedy saying it was too expensive. That larded-up cost? Fifty-seven cents per car, about the price of greasy diner coffee. True to GMs notorious culture of ignoring problems and shirking accountability, nothing was done. Some engineers even covered it up to save face internally. The Justice Department opened a probe, Congress wanted answers, and Barra had to take the heat. As if anything could be more embarrassing for a company that had survived its 2009 bankruptcy only with the last-chance lifeline of government money, it was about to be humiliated again.

That bailout hung over the proceedings. President Barack Obamas Auto Task Force had played a key role in restructuring the company in 2009 and helped create a new GM with a solid balance sheet, more focused family of brands, and a profitable business. It was clear, however, that while the government was funding GM, some insiders were either hiding the deadly ignition problem or, at best, not doing their duty to protect customers.