Bob Stempel’s good fortune came at an inopportune time.
Trained as an engineer and hailed as the “car guy” General Motors desperately needed when he was promoted to chairman and CEO, in 1990, Stempel’s tenure at the helm of what was then the world’s largest automaker lasted just two years before he fell victim to a boardroom coup.
But the amiable executive discovered there were plenty of opportunities after GM, and despite declining health continued to work in a variety of auto and technology-related ventures right until his death, over the weekend, at 77.
Born in Trenton, NJ on July 15, 1933, Bob Stempel’s first love was engineering, and he received a bachelor’s degree in the field from Massachusett’s Worcester Polytechnic Institute. But he also recognized that engineers could only go so far in the automotive world, so Stempel landed a master’s degree in business from Michigan State University in 1970.
In 1958, three years after getting his mechanical engineering degree, Stempel landed a job as a senior detailer with GM’s Oldsmobile division. Back then, the automaker’s various divisions operated as virtually autonomous fiefdoms, and Stempel remained with Opel for a number of years and through a variety of assignments.
Perhaps the most important product of that era to bear his stamp was GM’s first real front-drive model the now highly-collectible Toronado.
“The General Motors family mourns the passing of Bob Stempel, who admirably led the company during very difficult times in the early 1990s,” GM said in a statement. “Bob was a very popular chairman with employees, and his many accomplishments as a visionary engineer included leading the development of the catalytic converter, one of the great environmental advancements in auto history.”
As he climbed the corporate ladder, Stempel followed the traditional path of a rising star, becoming Chevrolet’s chief engineer in 1974, and then landing as general manager of the then-powerful Pontiac division four years later.
During this period of fast moves Stempel experienced a major family crisis when his then 13-year-old son Timothy was kidnapped. Apparently chosen at random, the youth had the presence of mind to scratch his name on the underside of the lid of the trunk where he was kept while the kidnappers waited for $150,000 in ransom money. They were arrested soon after the November 10, 1975 crime and the youth’s story – and the trunk lid – helped secure quick guilty pleas.
In 1984, then-Chairman Roger Smith announced the most far-reaching reorganization of General Motors since the days of the legendary GM boss Alfred P. Sloan. Smith abandoned well-known divisions, such as Fisher Body, and consolidated others. The various car brands at the time were organized into two groups: Chevrolet-Pontiac-Canada (which wags dubbed “Cheap Plastic Cars”), and Buick-Oldsmobile-Cadillac (which got the derisive nickname “Big Overpriced Cars”).
Stempel was put in charge of the latter – and later elected to the GM Board of Directors. His counterpart at CPC was Lloyd Reuss.
The reorganization, crafted by Smith working with consulting firm McKinsey and Co., proved largely a failure and resulted in a virtual paralysis of the entire company for several years, despite the best efforts of Stempel and Reuss. A series of minor fixes were rolled out, seemingly every four to six months, until Smith’s retirement.
Shortly before then, Stempel was appointed president, then was given the Chairman and CEO role, Reuss moved up to replace Stempel as GM president.
But the failed 1984 reorganization and the over-spending of the Smith era finally caught up with the company. Under heavy pressure from investors a newly-active GM Board sought change, first forcing out Reuss and then, in 1992 Stempel.
Critics accused the then 59-year-old executive of a variety of sins. Indeed, he seemed to have lost touch with his engineering roots once he reached senior management, approving a variety of questionable moves that hurt GM’s competitiveness. Stempel opted for automatic seatbelts, for example, rather than the publicly popular airbags that Chrysler was putting into virtually all of its products.
(On the other hand, Stempel played a key role in pushing for and developing GM’s first electric vehicle, the oft-lamented EV1.)
But perhaps Stempel’s biggest problem was a reluctance to wield the sharp knife a fast-failing GM needed to cut costs. Unable or unwilling, he was booted, his replacement Jack Smith – no relationship to Roger – an executive who spent most of his prior years working outside the clubby GM Building in Detroit.
While other ousted executives seemed only too eager to leave town, both Stempel and Reuss remained in the Motor City, each active in his own way, Reuss getting involved in a variety of charitable efforts, Stempel teaming up with Detroit inventor and entrepreneur Stanford Ovshinsky.
Ovshinsky was founder of Energy Conversion Devices, a firm that attempted to market his wide and various inventions, which covered fields as diverse as photocopying, solar power, rechargeable batteries and hydrogen storage.
Stempel eventually stepped back from his duties as ECD Chairman but continued working with the company right up through his death.
And despite the brutal setback at GM, he remained a loyalist to the end. During a tour of the Detroit Auto Show, last January, Stempel told anyone who would listen that he was convinced the once-powerful maker was on its way back.
Great piece Paul. Mr. Stempel was a great “car guy” executive. Few recall that Mr. Stempel took over as Chairman and CEO on August 1, 1990, and the First Gulf War began August 2, 1990. New car sales took a slight nose dive.
Thanks for your note, Peter.
I agree that Bob Stempel was a great guy and someone who will be missed. I don’t necessarily feel he was the right man for GM, at least at the time of his ouster, however. As you note, it was a desperate moment and Bob wasn’t necessarily ready to make the savage moves needed to get the maker through it all.
Curious how timing works. Today, Energy Conversion Devices has announced plans for a 30% cut in staff dues to reduced demand for its solar cells.
Paul A. Eisenstein
Publisher, TheDetroitBureau.com
Paul:
As you know, one of the more remarkable things about Bob Stempel was his amazing memory. Ask around, he typically astounded people with his ability to recall names and events.
Plus, he had the coolest wife of all the executive wives that I encountered in my 18 years of PR with the old General. Even after I jumped to SLP in 1994, whenever making the rounds at GM soirees, the Stempels stood out not only for his stature and booming voice, yet always friendly nature, Mrs. Stempel had a grace and persona rarely seen in automotive circles.
I’m going to be visiting some old friends at the new General Motors later this month. Would you care to go to lunch and play catch up?
The last time I saw you guys was around 1997, when I held a Christmas party at my the home in Rochester.
All the best,
Reg Harris
Hi, Reg,
Great to hear from you and much to catch up on which doesn’t necessarily need to be posted here.
I do recall Stempel’s memory, yes, and wish he could’ve willed it to me.
As for Mrs. S., yes, a striking woman who definitely didn’t fit the typical GM corp. wife image. I recall her showing up at an auto show gala wearing an amazing leather jumpsuit that was simply not what you expected to see here in Detroit. She stopped traffic everywhere she went that evening.
I will be in touch via the e-mail you left. It’ll be good to reconnect.
Paul A. Eisenstein
Publisher, TheDetroitBureau.com