Barra is currently a senior vice president at GM, responsible for global product development. She will replace current boss Dan Akerson on 15 January next year.
The 52-year-old was born in Detroit, home of the US motor industry, and has spent her entire career at the global company.
She started working for GM at just 18 years old and followed her father into the firm’s Pontiac division, where she inspected parts in the assembly wing while studying engineering at the General Motors Institute.
“I’m honoured to lead the best team in the business and to keep our momentum at full speed,” said Barra, adding that GM’s financial position made it an “exciting time” to take the leadership position. She will soon become the first female head of any of the world’s major automakers.
While Barra will take charge of Dan Akerson’s responsibilities as CEO in January 2014, his duties as chairman will be passed to Tim Solso, as Akerson’s major role is divided into two parts. Solso formerly led Cummins, which manufactures and markets engines, where he has worked for over 40 years, and been chief exec for the past 13 years.
Under Akerson’s watch, GM has made record profits, with 2011 earnings rising to $7.6bn (£4.62bn), a 62 per cent climb from 2010. The company said yesterday that his plans to retire had been pushed forward after his wife was diagnosed with an advanced stage of cancer.
The Detroit-based auto giant suffered particularly during the financial crisis, taking bailouts from both the Bush and Obama administrations in 2008 and 2009.
Akerson joined the group’s board as a representative of the US Treasury during a reorganisation in 2009, and GM rejoined the markets in 2010, with one of the biggest public offerings in American history.
The announcement also comes a day after the US government confirmed that it no longer has any remaining shares in GM, having sold its last remaining portion. In total, US Treasury bailouts cost the government nearly $50bn, of which $10.5bn (£6.08bn) has not been recouped.
Speaking to reporters yesterday, Akerson rejected the suggestion that GM is an old boys’ club with an institutional bias against women: “I look around at the number of women we have on our board, and roughly 25 per cent of our plants are run by women.”
In her product development role, Barra has led on the development of the Chevrolet Cruze, part of a new wave of more compact cars for the US market.
In the past, Barra has also stressed a commitment to the continued development of technology for electric cars, despite the firm’s recall of 8,000 hybrid Chevy Volts in 2012.
Barra’s current role will be filled by Mark Reuss, who is president of the company’s north American business.
Alan Batey, the Briton who will move to snap up Reuss’ post, also started off with the firm at a young age. His time with GM started as a mechanical engineering apprentice in Vauxhall.
“North America is the foundation of the GM turnaround story and I’m honoured to help continue what Mark started,” Batey said.
GM’s share price dropped slightly after the announcements yesterday, closing down a 1.2 per cent on the day.