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CNBC ON DIGG

GM's Whitacre Begins Long Slog

Published: Monday, 5 Oct 2009 | 9:35 AM ET

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By: Phil LeBeau

General Motors
CNBC.com
General Motors
When the GM board of directors meets today the group will get an update from GM executives about the progress they're making turning around the troubled auto maker. The general consensus is GM is stable, but still far from ready to take off. The board knows this, and most importantly, so does Chairman Ed Whitacre.

Ever since Whitacre was appointed Chairman, he's purposely maintained a low profile. Some of this is because its not his nature to be a high profile Chairman. He wasn't at Southwestern Bell/AT&T, and I doubt he will be at GM. But on top of that, Whitacre comes from the school of leadership where the only thing that matters is whether his top executives are posting the results needed.

Will GM be able to rebound and grow its business? That's still very much in doubt. Sure, there are some very encouraging things happening for the automaker right now (demand for its newest models like the Chevy Equinox is very strong and the money back offer has prompted more buyers to consider GM). But it's also still a company with some troubling trends (GM vehicle consideration is up largely with those predisposed to favor a GM brand). In other words, this is a company in the midst of a long slog to rebuild itself.

CEO Fritz Henderson and vice-chair Bob Lutz both believe the four brands at GM have exactly what they need to succeed. I'm not sure I agree, but give 'em credit for sticking to their guns and trying some new approaches. Take Buick. The company is now running commercials comparing the Lacrosse sedan to a Lexus. The spot is well done, and does make you say, "hmmm, maybe Buick is worth another look." It's a long ways between that and actually converting Lexus owners to become Buick buyers. Still, Lutz and his crew are being aggressive.

That's really what Whitacre wants. He and the board want to change the GM culture from one of being plodding and arrogant to being one that is nimble and hungry. It's a long slog and victory is not guaranteed.