General Motors taps Delta executive as new chief financial officer
General Motors Co. has hired Delta Air Lines Inc. executive Paul Jacobson as executive vice president and chief financial officer, nearly three months after the departure of former CFO Dhivya Suryadevara.
Jacobson, 48, will join the company Dec. 1, the automaker said Friday. He has been CFO of Delta since 2012, and prior to that held numerous roles since joining the carrier as a financial analyst in 1997. He was named the airline industry's best CFO eight times by Institutional Investor magazine's poll of Wall Street analysts and investors, GM noted.
According to the automaker, Jacobson is expected to play a key role in accelerating the company's transition to electric and autonomous vehicles. GM has promised an all-electric future lineup, and has laid out an ambitious plan to develop electric and self-driving vehicles in the coming years.
The automaker plans to spend more than $20 billion on electric and autonomous programs through 2025, and plans to bring 20 new electric vehicles to market by 2023. It has designated three U.S. plants for EV production — including two in metro Detroit — signaling accelerating plans to expand its EV range.
"Paul is a great addition to the GM senior leadership team and is dedicated to leading the company for the benefit of all stakeholders — customers, employees, suppliers, communities and shareholders," CEO Mary Barra said in a statement. "We share a commitment to teamwork and inclusion as we work toward our vision of a future with zero crashes, zero emissions and zero congestion while delivering a best-in-class customer experience, operational and financial excellence, and disciplined capital allocation."
In a statement, Jacobson called GM's vision "compelling because it embraces the needs of society, customers and investors." The company is "executing an historic technology shift to electrification from a position of strength," he said.
Jacobson's total compensation package totals more than $12 million in payments and stock options, according to a Securities and Exchange Commission filing.
His initial annual compensation will include a base salary of $1 million, a target annual cash incentive equal to 125% of his base salary, and a target annual equity award of nearly $4 million in performance share units and $1.3 million in stock options. On Dec. 1, he will receive a one-time grant in performance share units of $1,575,000 and $525,000 in stock options, as well as a one-time grant of $2.5 million in restricted stock options.
Jacobson earned a bachelor's degree in aviation management from Auburn University in Alabama. He has a master of business administration degree from the Owen Graduate School of Management at Vanderbilt University.
Among other roles, Jacobson was senior vice president and treasurer at Delta before becoming CFO in March 2012. In April, amid the widening pandemic, Delta CEO Ed Bastian announced in a memo to employees that, at Bastian's request, Jacobson had agreed to rescind his planned retirement from the airline.
Bastian credited Jacobson with helping the company navigate the impact of the novel coronavirus pandemic: "Under his leadership, we have boosted our liquidity through commercial markets and expanded our cash position to help us weather the storm in the months to come. Paul and his team have been instrumental in executing our strategy for cost reduction while forging the path ahead so that Delta is positioned to lead the industry when the recovery comes."
Bastian also noted Jacobson's role after the Sept. 11, 2001, terrorist attacks in "developing and leading the strategy that regained our investment-grade balance sheet." In the memo, Bastian said the company could be "heartened by the fact that Paul has chosen to stay with Delta not only as we rebuild, but for many years to come as we continue our climb."
Jacobson's departure comes at a challenging time for the airline industry, which has suffered large financial losses as COVID-19 has kept travelers out of the air. The industry has been pushing for another round of relief from the federal government after receiving a $25 billion bailout earlier this year, but Congress and the White House have yet to reach a deal on a new stimulus package.
The Atlanta-based company has managed to avoid large-scale employee furloughs, unlike competitors American Airlines and United Airlines, due to voluntary buyouts and employees agreeing to unpaid leave. U.S. airline companies reported more than $11 billion in losses in the third quarter, CNBC reported.
Suryadevara became GM's first female CFO in September 2018 after holding numerous other roles with the automaker since 2004. She left in August to become CFO of San Francisco-based Stripe, a global technology company that handles online billing and payments. She made $6.77 million as GM's CFO in 2019.
Suryadevara helped lead a restructuring of the company aimed at saving $6 billion through a planned $4.5 billion in cost reductions. Her interim replacement, John Stapleton, had been acting global CFO since the end of August. He will resume his previous role as CFO of GM North America.
Crosstown rival Ford Motor Co. also recently welcomed a new CFO. Jim Farley, upon taking over as CEO Oct. 1, replaced CFO Tim Stone with longtime Ford employee John Lawler, who most recently headed up the automaker's autonomous vehicle division.
Jacobson is on the board of trustees for the Auburn University Foundation, the Harbert College of Business Advisory Council at Auburn and the Owen Graduate School of Management Board of Visitors at Vanderbilt.