[paddyk]

General Motors Corp., seeking to speed up the restructuring plan announced last month, said it may be able to reap more of the $10 billion in projected savings this year instead of in 2009. GM rose today in New York trading.

The slumping U.S. auto market also may force GM to rethink some of its strategies for the GMAC LLC finance unit and the creation of an independent union retiree health-care fund, Chief Financial Officer Ray Young said late yesterday at a JPMorgan Chase & Co. automotive conference in Dearborn, Michigan.

Faster savings would afford Chief Executive Officer Rick Wagoner more flexibility under the plan he announced July 15 to boost liquidity by as much as $17 billion. The moves will give GM the cash to operate through next year, Wagoner has said.

``We're accelerating all of this stuff,'' Young said. ``We hope to realize a lot of the savings this year compared to our original plan we developed back in July.''

Young's comments in a Webcast presentation came after Moody's Investors Service lowered GM's credit rating to Caa1, one step further into junk status, on concern that falling U.S. sales will hurt efforts to improve cash flow at the world's largest automaker.

Among the savings that may be accomplished in 2008 instead of 2009 are some of GM's capital-spending reductions and 10 percent of the cutbacks in the salaried payroll, Young said. Detroit-based GM hasn't said how many salaried jobs it's cutting.

http://www.bloomberg.com/apps/news?pid=20601087&sid=aoAMP13CmzdA&refer=home

Ray Young's 8/13/08 Slides:

http://media.corporate-ir.net/media_files/irol/84/84530/2008_JPMorgan_RGY_WEB.pdf

 

[New_Mexico_Sunset_on_Rt66]

Some body is getting fired. Although I do not see a Proprietary statement on the slides, just All Right Reserved.

 

[jkennedy293]

Interesting that by 2010, plant utilization will be higher than plant capacity.

 

[stick076]

Interesting that by 2010, plant utilization will be higher than plant capacity.

Not really. Current utilization will still be under expected capacity. The CFO got a little marketing happy and took a small trend and decided to extend it for a long period of time. It could happen but to me there isn't much merit in that prediction.

EDIT: Looking at it again, the utilization is actually a percentage with the axis on the right side of the page (easy to miss). He is saying that GM will be at 100% utilization by then. They have been at about 85% this year.

 

[silvergoat2k6]

This just in: water is wet.

 

[Chaz_23]

"design and engineering footpring migrating to lower cost locations"
Great...

Can't wait to see these "modular plug and play components". In fact why wasn't that used for Zeta?

So Zeta was not first vehicle based on global architecture development?

What does "LAAM" stand for?

Why is there no slide for GMNA Outlook and Strategies? Do they have no strategy for NA?

 

[K-1]

"design and engineering footpring migrating to lower cost locations"
Great...

Can't wait to see these "modular plug and play components". In fact why wasn't that used for Zeta?

So Zeta was not first vehicle based on global architecture development?

What does "LAAM" stand for?

Why is there no slide for GMNA Outlook and Strategies? Do they have no strategy for NA?

LAAM = Latin America, Africa, and Middle East

 

[tgagneguam]

Taken alone, a lot of the developments seen in the PP presentation seem impressive; I particularly like the slides that emphasized flexibility within manufacturing so that production reflects consumer demands, so that savings can be driven from their operations. The problem, of course, is that this slide show in many ways could explain what is happening at many other automakers.

I hope that GM executes these plans well and gains at least some ground on more nimble, better managed foreign brands, but several key competitors have shown they're just as serious about containing costs, continuing to develop flexible operations, continuing to develop world-class cars and crossovers, continuing to develop fuel efficient powertrains, and continuing to share parts and platforms to achieve many of the aforementioned goals.

 

[Ambalanche]

"
Do they have no strategy for NA?

Do you really want an answer for that? Look at my sig...

 

[Chaz_23]

Thanks.
Strange to lump those very different markets into one unit.

LAAM = Latin America, Africa, and Middle East

 

[ericmvest]

Whose right the Merrill Lynch or the JPMorgan Chase & Co. analyst? In my opinion the JPMorgan Chase & Co. analyst is on target. Merrill Lynch states a strong sell opinion and JPMorgan Chase & Co. states an overweight opinion. Apparently there is a lot of disagreement on Wall Street about General Motors.

 

[63GrandSport001]

I dont see how saving 10 billion a year is going to help you if you loose 15 billion in one quarter..........

 

[eb110americana]

"design and engineering footpring migrating to lower cost locations"
Great...

Can't wait to see these "modular plug and play components". In fact why wasn't that used for Zeta?

So Zeta was not first vehicle based on global architecture development?

What does "LAAM" stand for?

Why is there no slide for GMNA Outlook and Strategies? Do they have no strategy for NA?

Taken alone, a lot of the developments seen in the PP presentation seem impressive; I particularly like the slides that emphasized flexibility within manufacturing so that production reflects consumer demands, so that savings can be driven from their operations. The problem, of course, is that this slide show in many ways could explain what is happening at many other automakers.

I hope that GM executes these plans well and gains at least some ground on more nimble, better managed foreign brands, but several key competitors have shown they're just as serious about containing costs, continuing to develop flexible operations, continuing to develop world-class cars and crossovers, continuing to develop fuel efficient powertrains, and continuing to share parts and platforms to achieve many of the aforementioned goals.

A couple of really good comments on the presentation. I too felt that the platform sharing and common standardized components like powertrains was very reassuring. And the "design and engineering footprint migrating to lower cost locations" was the most troubling. Is the US not low cost enough? How about building more cars here, the falling dollar certainly has a big advantage over Europe. I'm not looking forward to more Chinese, Korean, etc. engineered and designed vehicles.

The biggest thing missing from the presentation was any form of critical self analysis. During one of the lowest points in GM's history, and one threatening financial survival at that, GM cannot afford to be blowing sunshine up its own a$$. They need to look at things which are not working, and stop doing them. Obvious things like discontinuing investment in vehicles that won't sell and are on the decline. And less obvious ones like dissolving corporate marketing structures which are largely reactionary to market changes (GM needs to be innovative and first to market if it wants to get ahead, and it will never do so without taking risks). If GM cannot be critical of itself, how can it ever hope to improve?