The new General Motors today is holding its first shareholders meeting since emerging from bankruptcy in 2009 and issuing shares to the public last November. Not all the shareholders, though, will fit in the room: There are about 138 million of them.

That's because taxpayers in the U.S. still own 26% of the Detroit automaker, owing to the U.S. Treasury and Canadian government bailout of the company in 2009 with funds from the Troubled Asset Relief Program.

GM earned $4.7 billion last year and $3.2 billion in the first quarter of this year. GM CEO Daniel Akerson says he expects the U.S. government to start selling down its remaining stake in the automaker beginning in August. The automaker is on a much healthier track than before its reorganization. Considering the new and well-received vehicles that have come out last year, this year and for the next two years were planned and developed under the previous management regime, the new executives running GM still have a lot to prove.

Akerson has made it clear, after repaying loans to the U.S. and Canadian governments, that he is anxious to get the governments out of the car business. That is the chief reason the company launched its initial public offering (IPO) last November, sooner than many analysts and institutional investors had expected.

The government sold some of its interest last year with the IPO, but is still holding shares in the hopes of selling them at a higher price.

Besides the U.S. government's ownership, GM is primarily owned by investors who bought stock, the Canadian government and the United Auto Workers' Voluntary Employment Benefits Association (healthcare trust).

Akerson and other GM executives claim that many car buyers will not consider purchasing a GM vehicle because of the partial government ownership on ideological grounds. But evidence of that is spotty at best. It is true, though, that executive compensation and bonus plans are capped by government edict as long as the Treasury holds shares, so GM executives can't pay themselves more in salary and bonus until the government is out of its ownership stake.

GM's stock has not performed well since it began trading last November. While the IPO price was higher than projected and over-subscribed and climbed to a high of $39.48, shares of both GM and Ford have drifted lower since the first of the year. In GM's case, uncertainty of the government's timing for selling its stake, thus diluting the value of outstanding shares, may be weighing on the price, which has dropped 23% this year. But maybe not, since Ford's shares are also down 23% this year, and it has no government ownership.

A Telecommunications Executive in MoTown

Akerson came to GM as a board member in 2009. Chairman and CEO Edward Whitacre Jr. unexpectedly stepped down in 2010 before the IPO, when Akerson was tapped by the board to take over.

Before joining GM as a board member, Akerson, 62, had no experience in the auto industry, having spent his business career in the telecommunications and electronics industries before joining private equity firm The Carlyle Group.
Where will General Motors be next year?
At the top of the auto industry53 (31.9%)
Sliding towards the bottom of the auto industry47 (28.3%)
Somewhere in the middle66 (39.8%)


Akerson, like Whitacre, also a telecommunications executive, has been introducing new business practices and thinking at GM. As it headed into bankruptcy, the automaker was viewed as a fairly hidebound institution peppered with GM lifers who seemed to have earned degrees in "Inertia" at business school.

Lately, however, Akerson has been more forceful in driving decisions that will significantly impact everything from GM's brand strategy to engine selection and product design. In an interview with The Detroit News, Akerson recently talked about his decision to speed up the introduction of the new Chevy Malibu by eight months, a huge amount of development time in the auto industry. He also appears to be killing off further investment in vehicles that would run on fuel primarily made from ethanol or hydrogen, saying that neither fuel source had much of a future.

As GM moves forward, AOL Autos, which test-drives all the vehicles in the industry and covers the industry week-to-week, sees five things that GM is doing well relative to the competition, and five things Akerson and his team need to address if customers and investors are to remain interested in buying GM vehicles and GM shares.

The Good Five:

1. GM's vehicles, which have been launched in the last three or four years have been not only the best we have seen from the company in 25 years, but as good or better than their rivals. Noteworthy have been: Cadillac CTS and CTS-V; Buick Regal, LaCrosse and Enclave; Chevrolet Cruze, Silverado, Tahoe; GMC Acadia and Sierra. The Chevy Volt, an extended range electric vehicle, is a marvel of technology, but so far has a questionable business case owing to its high sticker price.

2. The small-car strategy that includes the forthcoming Chevy Sonic and Spark to go along with the Cruze, is a good strategy, and the products we have seen look well-turned out and very much up to the Asian rivals.

3. The company's eAssist system, like the one going on the Buick LaCrosse, to make large cars much more fuel efficient is smart and industry leading. Likewise, GM's pickup trucks are a virtual tie with Ford in terms of innovation and performance, and leave Japanese full-size pickups in the dust.

4. The company's strong position in China is being reinforced, and the vehicles are very popular.

5. Akerson, who was known to be a doubter of a decision made during GM's bankruptcy when he was just a board member to save Buick and GMC as brands (Buick is GM's most popular brand in China), says he concentrating on making Chevy and Cadillac the company's two global brands. One can start to see a possible decision in future to try and collapse the Buick and GMC businesses. The focus on the most efficient brands, models, engines and drivetrains, is smart and necessary.

The Bad Five:

1. While Akerson's outside perspective is healthy, he doesn't demonstrate much capacity to admit what he doesn't know about the auto business, which is nothing like the telecommunications business. Colleagues say he doesn't suffer fools even when the "fools" are right. Not knowing what you don't know can be the kiss of death for a CEO. This CEO also has something to learn about leadership, as he has made his personal conservative politics known to employees and the media on several public occasions and criticized cross-town rival Ford's Lincoln brand as a lost cause that should be "sprinkled with holy water." About two new Cadillacs coming next year, Ackerson said to the Detroit News, "They're not going to blow the doors off ... but they will be very competitive." Way to rally your troops and get the public excited! Despite his naval experience as an officer, Akerson could maybe take some lessons in class and leadership from Ford CEO Alan Mulally and Chrysler CEO Sergio Marchionne.

2. Beancounters often want to rush new vehicles to market because it brings in revenue faster. Engineers know that it is better for all concerned to make double and triple sure that a car is launched when it is ready and all quality concerns have been addressed. One of Toyota's downfalls the last few years was launching too many vehicles too fast. If the new Chevy Malibu is not well received or racked with recalls, will Akerson even still be the CEO to take the fall for it?

3. GM's product line is as strong as it is today largely because one passionate, experienced man, former vice chairman Bob Lutz, who rebuilt and led GM's product development organization from moribund and bureaucratic to one driven by passion, pride and good taste. Lutz was abruptly shown the door after the bankruptcy by GM's new management leadership and board principally because he carried a huge presence that over-shadowed the new outsiders with staff and the news media. He has been replaced by a manufacturing engineer, not a product or design engineer. Manufacturing engineers tend to direct products to be manufactured efficiently rather than to be home-runs with the public. GM has been here before -- in the 1990s -- when a former Procter & Gamble CEO was chairman and calling the shots. It is a critically important part of GM that bears close scrutiny in the four years from now when the new team's first products will hit the market.

4. GM is still flailing to come up with clear, winning marketing strategies for Cadillac, Chevy and Buick. GMC's "Professional Grade" positioning, which predates all current senior management, is the only clear brand strategy. A new group of ad agencies was ushered in last year with great fanfare and expectations. But the output has not been as good as the vehicles they are meant to support.

5. There are still too many GM lifers in the middle ranks where good ideas go to die. Outsiders like Akerson, chief marketing executive Joel Ewanick and vice chairman Steve Girsky can direct change from the top, but GM insiders will tell you that there is still too much inertia and meetings to no purpose that fill up the days of mid-level staff. Perhaps the company is still too big, or needs greater change of personnel.