Knudsen became president of GM in 1937 and served in that position until 1940.

That year, President Roosevelt’s National Defense Advisory Commission was revived and Knudsen was put in charge. He probably felt at home with U.S. Steel’s Edward Stettinius, a Council on Foreign Relations member who later became Secretary of State (1944-1945), and Sears’ chairman, Donald Nelson, the anti-Semite who chaired the America First Committee, an influential outfit that strongly opposed fighting Nazism. By 1941, Knudsen was co-chairing the Office of Production Management to oversee the country’s armament program. He probably felt less at home though with Roosevelt’s choice of co-chair, Sidney Hillman, a Jewish labour leader. But, all-in-all, WWII was highly profitable for Knudsen and his company. GM received $14 billion in contracts from the U.S. War Production Board, which was conveniently chaired by Knudson. GM’s vehicle factories in Germany churned out most of Hitler’s army trucks and many bomber aircraft engines for the Nazi war effort. In 1942, Knudsen was recognized in a special way by the U.S. Army. No he wasn’t arrested for conflict of interest or conspiring to arm the enemy, he became the first civilian to be made a U.S. Army General.