GM Fast Lane: Rick speaks on GM Turnaround Momentum

[nadepalma]

Source: http://fastlane.gmblogs.com/archives...ound_mome.html

July 28, 2006
Turnaround Momentum Drives GM in the Right Direction

Rick Wagoner. Editor's note: While FastLane is typically dedicated to discussion about GM products and services, Chairman and CEO Rick Wagoner has chosen to use this forum to update you on GM's turnaround progress.



By Rick Wagoner
Chairman and CEO

As I commented to financial journalists earlier this week, conventional wisdom holds that you can’t turn a ship as big as GM around quickly. We aim to prove that conventional wisdom wrong.

Our second quarter earnings report pleasantly surprised a lot of folks who are following GM’s turnaround progress in North America. Even some of our harshest critics were impressed.

Putting the financial mumbo-jumbo aside, what the numbers show is that our turnaround plan for North America is well on track and building momentum.

Lots more hard work and several big challenges remain in front of us, but I’m pleased with how much already has been accomplished in the past year. I’m very appreciative of GM’s employees, unions, dealers, suppliers and stockholders’ willingness to pitch in and help get the business back on track. It’s just starting to pay off.

You may have seen some headlines that said GM reported a net loss of $3.2 billion for the second quarter. That’s true. We booked several “special items,” which included a one-time $3.7 billion charge related to our successful hourly employee attrition program. A total of 34,400 employees took advantage of the buyouts, which are intended to help them make the transition to another line of work or early retirement.

Beyond cutting costs, we need to keep up our recent momentum in growing revenue with exciting cars and trucks. Based on the new vehicles in our “product pipeline,” there are plenty of reasons to be optimistic on that front as well.

Although it hasn’t been fully recognized yet in the business media, there are strong signs that GM’s already well on the way toward a product-led resurgence.

Dig into our most recent sales results, and you’ll see that in June our retail sales and market share were the strongest they’ve been all year. Our newly launched vehicles are selling very well, led by our new full-size SUVs, the Chevy Impala and HHR and Pontiac G6. The hot Pontiac Solstice and Saturn Sky roadsters are essentially sold out for this year.

The Saturn Aura midsize sedan and Saturn Outlook and GMC Acadia crossovers, our new full-size Chevy Silverado and GMC Sierra pickups, as well as the Saturn Vue Green Line — the nation’s most affordable hybrid SUV — will all debut through the second half of this year, and help build upon this recent growth.

Sometimes lost in all the attention paid to GM’s challenges in North America is the remarkable progress we’re making in the major growth markets elsewhere in the world. Our sales in Europe are strong and earnings there continue to rise. Our region that includes Latin America, Africa and the Mideast also has grown significantly; its earnings more than quadrupled in the second quarter versus a year ago. And in the Asia Pacific region, we continue to lead in the world’s fastest-growing market, China, and to rapidly expand sales at GM Daewoo in Korea.

We recognize that our most recent financial and sales numbers, while promising, aren’t enough to declare our turnaround a success quite yet. But we know what has to be done to get our North American business back on a solid footing, and we’re doing it.

[nikivee]

spin.

[New_Mexico_Sunset_on_Rt66]

Originally Posted by nadepalma

product-led resurgence.

Gotta like that.

[asim]

Hahaha...good job nadepalma, I was just about to post this. LOL

Anyhow...I think this move of Ricky on the GM fastlane blog is a good sign. I have never seen him on it. This should show his confidence in the brand and about his turn-around plan. This is good.

[cadillacpimpin]

i like how there are those little marketing tid bits stuck in there like the saturn vue green line, the nations most affordable hybrid SUV.
great use an information outlet.

Originally Posted by nikivee

spin.

i do not agree, spin is usually an attempt to make bad news good. such as a recall, saying that yes there is a recall, but we will kiss ur feet, and dont forget that flowers come out of ur tail pipe.

sure rick addresses the issue that they posted a nearly 4 billion dollar loss. but he also explains it with fact, no spin.

[camaro75]

Originally Posted by nikivee

spin.

Troll.

[SHOWMAN]

YEAH it's reassuring to see the big guy helping GM. I couldn't agree more that they are having steady success unlike some who have it off and on or other's who say they got it then spend all their money making CHEAP mess to put into American drive ways. UMMM makes you think about the other 2 doesn't it. It's really sad to see other companies go under a bit when GM wouldn't be here today if it wasn't for them all bashing heads. The products ROCK and people buy it's as simple as that. Dont make stupid choices and RICK is making really good ones.

[lilredcrvtt]

Positive forward progress! This is news and it is just the begining of the massive turn around, good start Rick. Let the turn around move forward....fast!

[monza164]

If you think about it GM did come out with waaay more cars than Ford or DCX, and they've still got a lot more coming.

GM just redid most of there car line, introduced a whole new platform, and has another on the way. They also redesigned there fullsized trucks/suv, that's like 10 models right there.

So Ford just came out with the Fusion so what's in the pipeline? a AWD Lincon? Chrysler just came out with the Sebring and Caliber, but what's next other than the Challenger.

So some of the redesigns are half-baked, but I'd like to see Toyohonda redo as many models as GM has done is such a short amount of time.

[hotrod747]

Must give credit where it is due: GM is making major strides for the better in the auto world with some very interesting product and they are really just beginning! Just my 2 cents, but the Zetas could prove to be just as popular as the full- size SUVs have been. It could very turn out to be another ace-in-the-hole for GM.

[djo165]

Originally Posted by cadillacpimpin

i do not agree, spin is usually an attempt to make bad news good. such as a recall, saying that yes there is a recall, but we will kiss ur feet, and dont forget that flowers come out of ur tail pipe.

sure rick addresses the issue that they posted a nearly 4 billion dollar loss. but he also explains it with fact, no spin.

There's definitely some spin here. The bad news? They lost nearly $4 billion. Why? Because they had to buyout over 30,000 workers and are closing several plants. Oh, but that's okay, because "the turnaround plan for North America is well on track and building momentum." ???

Everyone who follows GM closely knows that they beat analysts' expectations, but that doesn't mean that they've got the GM ship turned around. It just means that the ship isn't sinking as fast now as it was a few months ago. The ship will be turned around when they can go several years without losing any more market share, or maybe even gain market share.

[Rick 2000]

Soon I will make my second new GM car purchase in a 2 year span .
Feels good to know that I will be part of rebulding of Americas great
pride GM .

[steve333]

Rick-
Get rid of the electric steering
Put the parking brake on the console
Put tilt and telescoping steering wheels in every vehicle
4 Wheel disc brakes on all vehicles
Onstar standard on all vehicles
Put 5 or 6 speed auto transmissions in every vehicle
Use Your Best V6 engines in every vehicle
Make the Ecotec Engines world class
Improve all interiors
Increase your warranties across the board
Never ever dumb down a concept car like you did with the Aura again
Get over the fake wood obsession
The brake pedal should be level with the gas pedal, not 2 inches higher, on all vehicles
Seats in all vehicles should be amazingly comfortable
Window switches in all vehicles belong on the door, not the console
Strive to be the best, not just competitive
Bring designs like the Captiva to the US, don't stick us with crap like the Equinox, etc


You do all these things I mentioned and I will believe in GM's future.
ALL of these things and I will be convinced. Otherwise, you're just blowing smoke, IMHO.

[LAMRONH]

Short, sweet, to the point.
I'm seeing signs that The General is gaining some self confidence.

Next: cubic inches.

[rueben44]

Originally Posted by camaro75

Troll.

No he is right it is just spin. They are putting a band-aid on a cut and they are not addressing the problem that there is broken glass on the floor so the problem will not be solved for long. They are still not being managed right and are not using all they have properly. In addition I can not think of another company that feels the need to give so many pep talks to the media about their products. Your products will speak for them selves if they are class leading and that would simply be that.