General Motors Poaches Delta CFO to Fill Finance Seat -- Update
October 30 2020 - 5:03PM
Dow Jones News
By Mike Colias and Nina Trentmann
General Motors Co. has hired longtime Delta Air Lines Inc. chief
financial officer Paul Jacobson as its new CFO, landing a
high-profile executive from outside the car business as the auto
maker manages through the pandemic and technological
disruption.
Mr. Jacobson, Delta's CFO since 2012, will leave Delta as the
Atlanta-based airline tries to rebound from coronavirus-induced
losses. While the car industry has recovered from the depths of the
Covid-19 crisis, Delta and other airlines continue to face
depressed demand for air travel and are burning through millions of
dollars a day.
Mr. Jacobson will take over as GM's CFO on Dec. 1, the auto
maker said Friday. John Stapleton, who took over as GM's interim
finance chief following the departure in August of Dhivya
Suryadevara, will stay in that role until then, the company
said.
"GM's vision is compelling," Mr. Jacobson said in a statement
from GM. "They are executing a historic technology shift to
electrification from a position of strength."
Delta named two executives to become interim co-finance chiefs
while it searches for a permanent successor. Gary Chase, senior
vice president for business development and financial planning, and
Bill Carroll, senior vice president finance and controller, will
share the responsibilities. Delta said it would conduct a global
search for its next CFO.
The 48-year-old Mr. Jacobson in April called off his planned
retirement from Delta to help the company manage fallout from the
pandemic, which has forced airlines to drastically slash costs, cut
thousands of jobs and retire various aircraft.
"Paul has chosen to stay with Delta not only as we rebuild, but
for many years to come as we continue our climb," Delta Chief
Executive Ed Bastian wrote in an April 21 memo to employees.
Mr. Jacobson has been instrumental in steering the airline
through the pandemic. He raised billions of dollars in new funding
through bond sales and used the company's frequent-flier program to
tap additional capital. The airline ended its most recent quarter
with close to $22 billion in liquidity and reduced costs, and
paused new orders for aircraft.
Under Mr. Jacobson, Delta spent years paying down its debt
before the beginning of the pandemic, which meant the company had a
stronger balance sheet than some of its competitors.
As senior vice president and treasurer, a role he held from 2005
to 2012, Mr. Jacobson helped reshape the finances of the air
carrier after it emerged from bankruptcy in 2007. He joined the
company in 1997. "My heart is with the people of Delta," Mr.
Jacobson said in April following his decision to stay with the
airline.
Ms. Suryadevara left GM in August in a surprise departure, after
two years as GM's finance chief, to join financial-technology
startup Stripe Inc. She spent nearly her entire career at GM and is
highly regarded among Wall Street analysts.
Ms. Suryadevara led GM's efforts to add more than $20 billion in
debt last spring to cushion the company from pandemic-related
losses. She also helped set up GM's autonomous-car business,
Cruise, to receive outside investment, leading to more than $7
billion in fresh capital.
Mr. Jacobson will join GM at a time of pressing challenges as
well as longer-term changes to the auto maker's business model.
The auto maker has clawed its way back from the early days of
the Covid-19 crisis, when it burned through about $9 billion in
cash during the second quarter as its North American factories sat
idle. Since then, demand for cars has snapped back faster than
predicted, with vehicle output and sales roughly matching
pre-pandemic levels.
GM shares have more than doubled since March. They closed down
about 1% on Friday. GM reports third-quarter earnings on
Thursday.
Like other auto makers, GM faces the challenge of investing in
potential growth areas such as electric and driverless cars, which
today have uncertain payoffs, while also nurturing its traditional
business of gas- and diesel-powered vehicles.
GM Chief Executive Mary Barra is placing big bets on
battery-powered vehicles and Cruise. The company will spend $20
billion to build out those businesses through mid-decade,
executives have said.
"Paul is a great addition to the GM senior leadership team," Ms.
Barra said.
Write to Mike Colias at Mike.Colias@wsj.com and Nina Trentmann
at Nina.Trentmann@wsj.com
(END) Dow Jones Newswires
October 30, 2020 16:48 ET (20:48 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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