DETROIT – When asked, I regularly say perhaps the best parts of my job as Local 4 business editor is the access.
I get to spend time with and often speak at length with the movers and shakers locally and sometimes nationally of the stories that greatly matter to metro Detroit. I was fortunate to have been in a front row seat from Washington D.C. to Detroit and everywhere between during the auto bailout. During the GM restructuring in particular I interviewed all the players from the President of the United States on down. It's a very long list: Auto Task Force Leader Steven Rattner, his right-hand man Ron Bloom, former GM CEO Rick Wagoner, the next former CEO Fritz Henderson, former Vice Chairman Bob Lutz, UAW President Ron Gettelfinger, the entire Southeast Michigan Congressional Delegation. I read the books on that era, Rattner's "Overhaul" first among them.
In the aftermath there is only one person who has an open check mark next to his name among the people I wanted to conduct auto industry shop talk with and didn't. He is Harry Wilson.
Wilson stayed well behind the scenes, didn't do interviews, and didn't show up for the group photos. He spent a lot of time in Detroit and didn't make it obvious. It wasn't until after the dust had settled that his legend grew larger than life.
Rattner couldn't say enough good things about him in "Overhaul." He hired Wilson, who had emailed him saying he wanted to help with the restructuring. Rattner didn't know Wilson but he soon found out he was a very bright guy -- Harvard educated -- who had the time and the energy to help.
You see, Harry Wilson retired at the age of 36 to the Hamptons! He rocketed up the ranks on Wall Street as a restructuring executive. He'd grown up in upstate New York where the textile mills all failed during his childhood. Wilson, by all accounts, well remembers what that economic devastation meant to him, his family and his neighbors and wanted to make certain the auto industry and those who depend on it didn't suffer the same fate. Rattner quoted Wilson as saying during the turnaround: "I don't need bondholders; I need auto workers to build cars!" It was Wilson who came up with the new GM structure that favored the UAW, didn't end union pensions, off-boarded the VEBA to the UAW and ensured the healthcare trust was funded by the auto companies in the years immediately after the "quick rinse bankruptcy" ended.
Wilson received criticism for that from some on Wall Street, but the fact of the matter is Wilson moved into the Ren Cen offices like a hurricane, questioned everything, and roared at the answer "because that's the way we've always done it!"
He couldn't believe what he found, such as the fact that GM couldn't say at any given point in time exactly what cash it had on hand, that it wasn't even using excel spread sheets to keep track of such important data. Many believed or assumed the man behind the GM restructuring was a Democrat, but GM's Bob Lutz said in interviews that Harry Wilson was a Republican and genuinely had GM's future in mind as he did what he got rich doing: giving GM a fighting chance at a future. Lutz, too, couldn't say enough good stuff about Wilson.
Wilson ran for New York State Treasurer a few years ago and lost. Recently he's been working with a number of hedge funds. He was involved in the recent Radio Shack bankruptcy. It was far too gone for him to work his magic and ended up liquidating and giving its stores over to cellphone-maker Sprint.
Wilson apparently never lost his interest in General Motors. He's purchased more than a $1 million worth of GM stock and started working with four different hedge funds who own large chunks of GM stock, too.
In a recent analysis Wilson decided GM was sitting on too much cash at the same time its stock has languished in the low 30s. He believed GM could buy back $8 billion worth of stock and return a lot of the company's value to shareholders. Remember that he and his group are one of the larger shareholder groups! He became what's known in the business as an "activist shareholder." Normally when you hear about them -- guys like Carl Icahn -- they are looking for the quick hit, the fast uptick in the stock that allows for a fast and big buck return on investment. Wilson certainly threw his weight around GM headquarters yet again when he demanded the company buy back the stock and asked to be put on the GM board of directors.
Wilson's entreaties were certainly not welcome, but GM CEO Mary Barra had to play this carefully. Normally when an unwanted overture of this kind is offered, the company plays hard-to-get and often has unkind words for the activist. Politically, Barra couldn't do that considering Wilson at one time likely knew more about GM than she did. She had been hoarding cash because she still can't say exactly how much the ignition switch recall is going to cost. But Wilson was not going away quietly. Barra calmly and coolly met with Wilson, struck a deal to buy back $5 billion in stock over the next two years and said no to Wilson's board seat request. Wilson is happy for the time being, whether he returns with his activist shareholder act again is anyone's guess.
Still, this episode says a lot about the new GM and the people who put it where it is. Wilson is deeply concerned and interested in GM's future and happy it is still able to pay him in the process. Barra put down the insurrection without a P.R. disaster and showed a deft touch in crisis management that was sorely lacking in the ignition switch debacle.
So GM moves on and Wilson will stay vigilant letting everyone know he's waiting in the wings and willing to kick GM in the pants if necessary. Barra can get back to running a far healthier car company.
I saw Wilson on CNBC once or twice over the years after the turnaround and always wanted the chance to pick his brain about how the turnaround went from his perspective. Now I am more than ever looking forward to that chance in the future. I tried to contact him today unsuccessfully. We'll get him though, rest assured! I will punch that blank box on my checklist!
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