GMAC Inc. is based in Detroit. It says so on the automobile lender’s Web site. It says so in its regulatory filings. But CEO Al de Molina lives and works in Charlotte. So do the company’s chief risk officer, chief marketing officer, treasurer, head of human resources and chief compliance officer. By the litmus test of former Bank of America Corp. CEO Hugh McColl, GMAC is based in the Queen City. “Mr. McColl used to say, ‘The headquarters is wherever I am,’” says de Molina, who worked at BofA for 17 years and has lived in Charlotte for 20. “I wouldn’t go that far.”
Many have speculated that GMAC would move its headquarters to Charlotte because of the city’s rich supply of banking talent. But Detroit has history and heartbreak on its side. GMAC, then General Motors Acceptance Corp., was started there 90 years ago to help GM sell cars. Since then, the Motor City has fallen on hard times. Its population has decreased 45% since 1960, and the unemployment rate in the metro area has been in double digits since January, hitting 16.4% in July. When it announced its major expansion in Charlotte last spring, GMAC decided not to move its headquarters. “The titular headquarters have always been in Detroit,” de Molina says. “And we didn’t think that Detroit nor Michigan needed to have another kick in the side of the head.”
In 2006, GM sold controlling interest in GMAC to investors led by New York-based Cerberus Capital Management LP, and GMAC has struggled since, posting a loss in its first full year of independence. In the second quarter, it suffered its third loss in four quarters. De Molina is turning GMAC into a bank holding company to broaden its focus, and much of the brainpower for that effort is in Charlotte. The company will create 200 jobs there, boosting local employment to more than 400 by the second quarter of 2011.
If GMAC wants to be successful, its future is in Charlotte, not Detroit, says Tony Plath, associate professor of finance at UNC Charlotte. It’s a far better market for recruiting people with the necessary expertise. “They’re a bank holding company, which means that they’ve got to develop a diversified loan book. They’ve got to have expertise to manage a securities portfolio. They’ve got to have the marketing talent to take deposits. They’re not just financing Chevys anymore.”
De Molina knows better than anyone how important Charlotte is to GMAC. But with modern communications, he says, it’s not important that the headquarters follow the top executives. “It really is something that doesn’t cost us anything but helps somebody else, and therefore it’s a win-win — or a win-draw — and you might as well do it.”
Cubs leave big cat lair
In a family business, children often take over from their parents, and that seemed to be the direction the Carolina Panthers were heading. But Mark and Jon Richardson, sons of majority owner Jerry Richardson, resigned as team president and stadium president, respectively. No reason was given, but they reportedly clashed often. Both remain members of the National Football League’s Charlotte franchise ownership group, but the move raises doubts about who will eventually succeed their 73-year-old dad. Danny Morrison, former athletics director at Texas Christian University, took over as team president. From 1985 to 1997, the Burlington native was A.D. at Wofford College. The Spartanburg, S.C., school, where the Panthers hold training camp, is Jerry Richardson’s alma mater.