GM Paves Way To Long Term Sustainability
Notes from GM's global business conference.
www.GMInsideNews.com
August 9, 2011
By: Nick Saporito
Today General Motors hosted its annual Global Business Conference. This event is utilized to establish GM's long term strategies for business growth and sustainability. This is the second year the event has been held.
Below are notes pulled from the event. Investors in attendance at the conference were shown future product and even got to drive the upcoming Cadillac XTS and ATS.
Dan Akerson
GM CEO Dan Akerson was first to speak on the call, discussing overall results and the macro view of the company’s plans. Akerson stated that GM would begin manufacturing Cadillac models (SRX) in China by the third quarter of 2012. GMI has been told the ATS will also eventually see Chinese production.
Akerson stated that the company plans a 50% reduction in both engine platforms and vehicle platforms by 2018. This correlates with the company’s goal to reduce complexity and become more agile in product development. The reductions will also reduce product development costs.
GM will introduce 16 new or revised models in China over the next five years.
Dan Ammann
Next up was GM CFO Dan Ammann, who focused on the company’s financial status both short and long term. Ammann was explicit in stating that, because GM is currently profitable, the focus throughout the company is long-term results. He also stated that GM’s profit margins are ahead of Toyota’s, but lag behind Ford and Hyundai; citing they have work to do to improve margins.
Mary Barra
Mary Barra is the new senior vice president of GM product development. Barra claimed that GM wastes about $1 Billion annually in product development, “churn” if you will. GM tends to have a lot of start/stop development programs that lead to the cost disadvantage.
Barra, former head of human resources at GM, also alleged that the company has too many engineers working on non-product programs versus the competition.
Barra ended her discussion by showing investors several upcoming GM products, including the new Malibu, Cadillac XTS, Chevrolet Spark and next-generation Chevrolet Impala. Investors tweeted that she was not saying much about the new Impala.
Bob Socia
GM’s head of purchasing and supply chain management called GM’s relationship with suppliers “weak” in comparison to most of the competition. He claims GM aspires to be the “OEM of choice” for suppliers and hopes to leverage supplier capabilities more going forward.
GM plans on bringing suppliers in on development programs soon in hopes of capitalizing off their abilities more.
Diana Tremblay
Tremblay is GM’s chief manufacturing officer. Tremblay confirmed that GM has four plants under construction in China and one in Russia. She also stated that any excess capacity in North America has been removed, largely thanks to the bankruptcy. GM currently has the ability to expand North American capacity to accommodate a 16 million unit per year market.
Tremblay also stated that GM quality has improved to above the industry average with 49 problems per 100 vehicles; industry average is 52 per 100.
Joel Ewanick
GM’s new chief marketing officer fielded several questions about Buick and Cadillac. According to Ewanick, Cadillac will be marketed as a brash, aggressive luxury brand while Buick will be inviting and sculpted.
In regards to Opel, Ewanick said GM plans to move the brand up market in Europe to compete directly with Volkswagen. In China, Ewanick admitted that Buick will be a bit more mainstream and possibly overlap with Chevrolet.
Ewanick wants Chevrolet and Cadillac to be consumer brands, not just automotive brands.
Don Johnson
Don Johns is GM’s vice president of sales for North America. He started by saying GM believes there is pent up demand in the marketplace and that GM is working with dealerships to spiff up retail facilities. Johnson claims GM will have over 4,000 overhauled dealerships, representing 96% of their retail network by 2014. Over 460 stores will be renovated by the end of 2011.
Johnson also stated that 92.9% of dealerships are profitable, the highest number since the 1970’s.
Notes from GM's global business conference.
www.GMInsideNews.com
August 9, 2011
By: Nick Saporito
Today General Motors hosted its annual Global Business Conference. This event is utilized to establish GM's long term strategies for business growth and sustainability. This is the second year the event has been held.
Below are notes pulled from the event. Investors in attendance at the conference were shown future product and even got to drive the upcoming Cadillac XTS and ATS.
Dan Akerson
GM CEO Dan Akerson was first to speak on the call, discussing overall results and the macro view of the company’s plans. Akerson stated that GM would begin manufacturing Cadillac models (SRX) in China by the third quarter of 2012. GMI has been told the ATS will also eventually see Chinese production.
Akerson stated that the company plans a 50% reduction in both engine platforms and vehicle platforms by 2018. This correlates with the company’s goal to reduce complexity and become more agile in product development. The reductions will also reduce product development costs.
GM will introduce 16 new or revised models in China over the next five years.
Dan Ammann
Next up was GM CFO Dan Ammann, who focused on the company’s financial status both short and long term. Ammann was explicit in stating that, because GM is currently profitable, the focus throughout the company is long-term results. He also stated that GM’s profit margins are ahead of Toyota’s, but lag behind Ford and Hyundai; citing they have work to do to improve margins.
Mary Barra
Mary Barra is the new senior vice president of GM product development. Barra claimed that GM wastes about $1 Billion annually in product development, “churn” if you will. GM tends to have a lot of start/stop development programs that lead to the cost disadvantage.
Barra, former head of human resources at GM, also alleged that the company has too many engineers working on non-product programs versus the competition.
Barra ended her discussion by showing investors several upcoming GM products, including the new Malibu, Cadillac XTS, Chevrolet Spark and next-generation Chevrolet Impala. Investors tweeted that she was not saying much about the new Impala.
Bob Socia
GM’s head of purchasing and supply chain management called GM’s relationship with suppliers “weak” in comparison to most of the competition. He claims GM aspires to be the “OEM of choice” for suppliers and hopes to leverage supplier capabilities more going forward.
GM plans on bringing suppliers in on development programs soon in hopes of capitalizing off their abilities more.
Diana Tremblay
Tremblay is GM’s chief manufacturing officer. Tremblay confirmed that GM has four plants under construction in China and one in Russia. She also stated that any excess capacity in North America has been removed, largely thanks to the bankruptcy. GM currently has the ability to expand North American capacity to accommodate a 16 million unit per year market.
Tremblay also stated that GM quality has improved to above the industry average with 49 problems per 100 vehicles; industry average is 52 per 100.
Joel Ewanick
GM’s new chief marketing officer fielded several questions about Buick and Cadillac. According to Ewanick, Cadillac will be marketed as a brash, aggressive luxury brand while Buick will be inviting and sculpted.
In regards to Opel, Ewanick said GM plans to move the brand up market in Europe to compete directly with Volkswagen. In China, Ewanick admitted that Buick will be a bit more mainstream and possibly overlap with Chevrolet.
Ewanick wants Chevrolet and Cadillac to be consumer brands, not just automotive brands.
Don Johnson
Don Johns is GM’s vice president of sales for North America. He started by saying GM believes there is pent up demand in the marketplace and that GM is working with dealerships to spiff up retail facilities. Johnson claims GM will have over 4,000 overhauled dealerships, representing 96% of their retail network by 2014. Over 460 stores will be renovated by the end of 2011.
Johnson also stated that 92.9% of dealerships are profitable, the highest number since the 1970’s.