GM Chief Defends Himself Amid Calls for Resignation
General Motors Corp. Chairman Roger Smith defended his record today at the company’s annual meeting against a torrent of verbal abuse and calls for his resignation from critics of GM’s plant closings and profits decline.
Smith said the auto maker’s nearly $3 billion in profits last year gave it the fourth-best earnings performance of any U.S. corporation and the sixth-best profits in the company’s history.
And he said that a massive reorganization and investments for modern plants undertaken in the 1980s would increase profits in coming years as the company carries out plans to cut its white-collar ranks and close uncompetitive parts-making plants and obsolete vehicle factories.
This did not satisfy a group of loud critics at the meeting in a theater across the street from GM’s world headquarters. They included several veteran corporate gadflies, union workers and consumer activists.
‘We Want You Out’
Wayne Taylor, who described himself as a GM employee from Kansas City, Mo., said he was “speaking for the staff and workers at our plant in saying we want you out as chairman.”
Jim Musselman of Washington urged Smith to step down, accusing the GM board of being “nothing but rubber stamps.”
And one critic, in a swipe at Smith’s salary and bonus last year, observed: “Everybody gives the man who makes $2 million a year holy hell.”
But the GM chief executive generally took the criticism in stride, responding: “Our profits went down because we invested for the future. Are we a society that cares only for short-term profit?”
Fired H. Ross Perot
The GM chief executive has been under increasing fire since the December ouster of dissident director H. Ross Perot in a controversial $750-million stock buyout designed to silence Perot, GM management’s most prominent critic.
GM also endured the embarrassment of watching smaller rival Ford Motor Co. outstrip it in earnings last year for the first time since 1924. Similar results at Ford are expected this year.
But GM has fought back in the last few months by embarking on a public-relations offensive aimed at bolstering or regaining the confidence of Wall Street and other large investors after more than two years of declining earnings.
