General Motors Corp. said Friday that it has filed criminal charges against J. Ignacio Lopez de Arriortua, contending the former head of GM’s worldwide purchasing took confidential documents with him when he left to join Volkswagen.
GM offered little elaboration, although John Smith, president and chief executive, who had handpicked Lopez for top GM management, called Lopez’s defection and the resulting court action “a tragedy.”
GM Europe President Louis Hughes said the criminal complaint, called a Strafanzeige, was filed in Germany against Lopez.
Lopez attended a lengthy meeting of GM’s European strategy board a week before he quit GM in March to join Europe’s largest automaker as head of worldwide manufacturing. GM’s product plans for the next decade were discussed at the meeting.
“We believe that confidential documents have been taken from us, and that is against the law in Germany if that’s the case and that’s established,” Hughes said.
The criminal charge against Lopez came in the wake of a restraining order GM sought to prevent the departing executive from raiding GM Europe purchasing executives from its Adam Opel unit.
The Lopez affair appeared to be over after the anti-raiding injunction was issued in Germany in late March.
Efforts to reach VW officials were not immediately successful Friday.
News of the criminal charge against Lopez came after GM’s annual meeting in Oklahoma City. In talking with shareholders, Chairman John Smale, who took over the post after the ouster of Robert Stempel late last year, hinted he may stay in that office for some time, perhaps until GM’s only money-losing area-North American automotive operations-becomes profitable again.
“We’re after getting business back to where it should be,” Smale said at a news conference.
“I’ve got an investment in this, and it’s important to me that it succeeds. I can help.”
Smith said GM is committed to returning North American operations to profitability after they lost $3.6 billion in 1992 and $6.9 million in 1991. He said GM’s goal is to break even before taxes in North America in 1993 and to be profitable within four years.
Smale and Smith used the conference to exchange compliments, Smale calling Smith “exactly the right man to lead a culture change at GM” and Smith responding that Smale “is tremendous to work for because he pushes us in areas we should be pushed, especially where we should be for the longer term.”
Smale left little doubt he intends to retain power. He said he’s pleased with a board now composed of 15 outside and only two inside directors-Smith and William Hoglund, executive vice president. It was the outside directors who supported the ouster of Stempel and elevation of board member and former Procter & Gamble chairman Smale to chairman.
“I think the configuration (of the board) is satisfactory as it is,” Smale said. “A fair number of GM executives attend the board meetings,” he added, neglecting to note that-aside from Smith and Hoglund-they have no voting power.
The annual meeting followed an unusual format in which Smith, saying he was given “a mandate for change by the board,” spent the first 90 minutes along with fellow executives detailing changes since Stempel’s departure.
Hoglund said GM now operates with a “bold, winning attitude” in which “management structure is more flexible and more accountable,” in contrast to “GM’s past structure that was slow, bureaucratic, with very little teamwork and perhaps even less accountability.”
Gadfly investor Evelyn Y. Davis called the 90-minute pep talk “a filibuster.”
Much of the meeting was devoted to shareholder complaints that GM executives are overpaid in light of the auto giant’s financial woes.
Also, a woman whose son died after his GM truck caught fire when struck in an accident tearfully said she held Smale and the board accountable. Consumer groups have asked GM to recall 1973-87 pickups based on charges that placement of the fuel tank outside the vehicle’s frame rails could result in fire on impact.
Smale said he “couldn’t accept your characterization,” while Harry Pearce, GM general counsel, repeated GM’s stance that its trucks are safer than competitors’.
At the meeting, GM also said it will offer a four-door version of its full-size Chevrolet Blazer utility vehicle for the first time in the ’95 model year; that it has no deal with Toyota to build trucks for that automaker in the U.S.; that its EDS subsidiary will consider offers to take on an equity partner; and that GM has no plans to abandon its Oldsmobile division.
Shareholder proposals to limit executive incentive awards until dividends are increased and to limit top executives’ pay to 100 times that given the lowest-paid hourly worker were defeated.
