Seat of the pants

12 August 2010 By Antony Currie Follow @AntonyMCurrie

Carlyle executive Dan Akerson is probably a better longterm solution than Ed Whitacre. But the surprising and clumsy announcement, on the eve of an IPO filing, furthers the impression that this company isn t quite ready for prime time. That could hurt returns for Uncle Sam.

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Edward Whitacre is to step down as chief executive of General Motors on Sept. 1 and as chairman at the end of the year. Board member Dan Akerson will take on both roles. Akerson is currently head of global buyouts at The Carlyle Group.

General Motors reported secondquarter net income attributable to common stockholders of $1.3 billion. Revenue was $33.17 billion, an increase of 5.4 percent from the first quarter. Expenses rose 3.3 percent from the first quarter to $31.42 billion.

GM North America posted earnings before interest and taxes of $1.6 billion, a third more than in the first quarter. GM Europe's loss before interest and taxes narrowed by $300 million to $200 million.

Free cash flow of $2.8 billion was almost treble the first quarter. Cash and marketable securities dropped by $3.2 billion to $32.5 billion as the boost in free cash flow was more than offset by repaying debt to the U.S. and Canadian governments, which reduced its debt to $8.2 billion from $14.2 billion.

GM's pension funds remain underfunded by $26.4 billion and other postretirement benefits by $9.3 billion.

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