Tag Archive | "GM"

GM Expects to Fall Short of 2017 Electric Vehicles Target


General Motors Co said it will fall short of its goal of having 500,000 GM vehicles on U.S. roads by 2017 that are powered by some form of electricity, reported Reuters.

The No. 1 U.S. automaker said in its annual sustainability report that lower gasoline prices and a “surge” in model offerings from all automakers contributed to the lower-than-expected sales for electrified products, including plug-in hybrids, pure electric vehicles and vehicles with the eAssist system that boosts fuel efficiency in gas-powered cars.

“For our commitment to electrification, our forecasted outlook currently projects us, along with the broader automotive industry, falling short of expectations for 2017,” GM said in the 2014 report released on Thursday.

“GM is committed to electrification … but consumer demand for these vehicles has not kept up with our initial projections,” it added.

The company said it counted 180,834 electrified GM vehicles on U.S. roads last year, up from 153,034 such vehicles in 2013.

GM Chief Executive Mary Barra outlined its 2017 target in November 2012 when she was the automaker’s global product chief. At the time, Barra said the company’s plans called for the eAssist system, which boost fuel efficiency as much as 25 percent in some gas-powered vehicles, to be on “hundreds of thousands” of vehicles annually by 2017.

GM, like other automakers, needs more fuel efficient cars as the industry pushes toward more stringent U.S. requirements that will be in place by 2025.

Electric vehicles have failed to catch on with consumers due to high prices, disappointment with electric driving range and an under-developed charging infrastructure. Low gas prices have fueled consumer demand for larger vehicles, including full-size pickup trucks and SUVs.

In 2013, The U.S. Department of Energy backed off President Barack Obama’s goal of putting 1 million electric cars on U.S. roads by 2015.

GM is developing an all-electric vehicle, the Chevrolet Bolt, with an electric driving range of 200 miles and production is expected to start in 2016. It will sell for about $30,000 after a federal tax rebate.

The automaker also this fall is introducing a redesigned version of its Chevy Volt plug-in hybrid that has an increased electric driving range of 50 miles and sells for almost $1,200 less than the current version of the car.

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GM CEO Barra Confident About Value of Company’s Stock


General Motors Co’s chief executive said on Monday she is confident the company will convince investors of the value of holding on to GM’s stock, which has dropped nearly 9 percent since mid-March despite a $5 billion share buyback plan, reported Reuters.

The automaker’s shares have declined as investors are concerned the U.S. auto cycle has peaked, analysts said. The company makes its profit in North America and in China, where margins are likely to be squeezed.

“This is a business that is not made on a quarter-by-quarter basis,” CEO Mary Barra told reporters at a roundtable interview at GM’s assembly plant in Kansas City, Kansas.

“We just need to continue to have strong performance, which we did in the first quarter, quarter after quarter, year after year, focus on the right products, the right technology, quality and our customers and over time, we will earn that reputation.”

Barra spoke at the Fairfax Assembly plant, where she led a celebration to mark the company producing the 500 millionth vehicle in its history.

Alan Batey, GM’s North American president, told Fairfax workers and Kansas politicians that the company will invest $174 million in the plant for new equipment and technology to produce the 2016 Chevrolet Malibu midsize sedan. That vehicle will go on sale later this year.

The investment is part of GM’s plan to spend $5.4 billion at its U.S. plants over the next three years.

GM shares were up 0.5 percent at $35.58 on Monday afternoon. That compares with $33 at the post-bankruptcy initial public offering in 2010. GM announced the $5 billion share buyback in March to appease frustrated investors.

Barra said she has not met with Fiat Chrysler Automobiles Chief Executive Sergio Marchionne and that GM will continue to follow its own plan regarding investing in product development.

She also said GM will continue to work with partners in particular areas, such as Honda Motor Co for fuel cell development and SAIC Motor Corp Ltd in China.

Barra declined to discuss U.S. labor costs in detail. The company and the United Auto Workers union enter contact talks this summer.

“We’re going to work very hard in constructive problem-solving with our union partners to make sure we have agreements that are good for the company, good for the workers, allow us to maintain our competitiveness,” she said.

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GM CEO Barra Received $16.2 Million in 2014 Compensation


General Motors Co Chief Executive Officer Mary Barra, who last year became the first woman to lead a major U.S. automaker, received $16.2 million in 2014 compensation, up 78 percent from her predecessor’s total the previous year, reported Reuters.

Most of Barra’s compensation is tied to stock awards that she cannot cash in yet. She received $4.55 million in salary and other liquid compensation for 2014, GM said in a proxy filed on Friday with the U.S. Securities and Exchange Commission.

Barra, 53, replaced Dan Akerson, now 66, as CEO in January 2014. Akerson’s 2013 compensation was $9.1 million.

Barra was paid $5.2 million in cash and stock in 2013, when her title was executive vice president and she headed global product development.

Detroit-based GM is now linking executive compensation more closely to performance, as other big companies have done, as it moves beyond the more restrictive guidelines it followed after its 2009 U.S. government-led restructuring.

Barra and other top GM executives attained 74 percent of the company’s targets for profit, automotive cash flow and global market share and quality. The quality metric included “customer enthusiasm” and loyalty, as well as warranty expense.

Soon after Barra’s ascension to CEO, GM became embroiled in a massive recall of older vehicles with faulty ignition switches that have been linked to at least 87 deaths. She testified several times before Congress to explain GM’s botched response which included an 11-year gap before the recalls.

GM’s board of directors chose not to award discretionary bonuses to any of its top executives last year.

Ford Motor Co also changed leaders last year as Mark Fields replaced Alan Mulally, who was largely credited with helping Ford avoid the bankruptcies that in 2009 ensnared GM and what was then Chrysler, now Fiat Chrysler Automobiles.

Fields, who became CEO in July 2014, received $18.6 million in compensation for last year, and Mulally was compensated for the full year to the tune of $22 million. Ford Executive Chairman Bill Ford made $15.1 million.

FCA Chief Sergio Marchionne received compensation valued at about $38 million based on currency exchange rates at the end of last year.

GM’s annual meeting will be held on June 9 in Detroit. Shareholders will consider company nominee Joseph Jimenez to join the board. Jimenez, 55, is CEO of Novartis AG.

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GM’s Profits Rise to $945 Million in Q1


DETROIT – General Motors on Thursday reported net income of $945 million for the first quarter of 2015. That compares to net income of $108 million for the Detroit automaker in the comparable period one year ago, reported MLive.

GM’s earnings before interest and taxes increased to $2.1 billion, compared with an EBIT of $500 million in the first quarter of 2014.

The company had $1.3 billion in recall-related pre-tax costs and $0.3 billion in restructuring costs in the year-ago period, compared with just $0.1 billion in restructuring costs in first quarter of this year.

Revenues dipped to $35.7 billion in the first quarter of this year from $37.4 billion in the year-ago quarter.

“Our results in the first quarter provide a solid foundation to achieve our financial commitments for the year,” GM CEO Mary Barra said in a release. “Continued execution of our plan, including our capital allocation framework, will drive profitable growth, return on invested capital and shareholder value.”

By region, the company handily improved its EBIT in North America to $2.2 billion in the first quarter, after incurring that $1.3 billion costs there in the year-ago quarter. GM narrowed its EBIT loss in Europe to $200 million, compared with $300 million in the comparable period. Its EBIT in South America was flat at about a $200 million loss.

“Key vehicles like our recently launched full and mid-size trucks, and our cost discipline helped us deliver a solid quarter,” Chuck Stevens, GM executive vice president and chief financial officer, said in a release. “We continue to take decisive actions to address issues head-on and to drive the company to generate strong results.”

Last month, GM announced a $5 billion stock buy-back program. The automaker said Thursday it had since repurchased 19.4 million shares.

Separately, on Tuesday GM announced a 2 percent rise in vehicle sales to 2.4 million units sold globally in the first quarter. Sales in North America were up 6 percent, in China they rose 9 percent and Opel/Vauxhall’s sales grew 3 percent in Europe.

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GM CEO Mary Barra Brushes Off Merger Talks


DETROIT – General Motors CEO Mary Barra said the automaker has a comprehensive plan in place through the early part of the next decade, and a merger with a large, competing automaker does not appear to be part of that, reported MLive.

Speaking in a conference call Thursday morning to discuss the Detroit company’s first quarter financial results, Barra was asked about Fiat Chrysler CEO Sergio Marchionne’s remarks on the possibility of merging with a large automaker, such as GM or Ford Motor Co., and about general chatter on the need for consolidation in the industry.

Barra said the plan GM currently has in place includes “plenty of areas for efficiency,” and that the company is already one of the top-tier, global OEMs. The company’s plan includes several milestones to ensure it remains at the top.

“We’re not going to entertain anything that’s going to distract us from accomplishing that,” Barra said.

Marchionne, who led Italian automaker Fiat SpA’s merger with Chrysler Group, said in March during an interview with Bloomberg News in Geneva that he would be open to combining the company with one if its larger Detroit rivals.

He called a combination with GM or Ford “technically feasible,” and said there’s always banter to that effect, but added that there is still “nothing substantive.”

At that time, both Ford and GM generally balked at the notion.

General Motors on Thursday reported net income of $945 million for the first quarter of 2015. That compares to net income of $108 million for the Detroit automaker in the comparable period one year ago.

The result came on revenues that dipped to $35.7 billion from $37.4 billion in the year-ago quarter.

Ford plans to report its first quarter results April 28, and FCA is set to do the same on April 29.

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GM Nominates Pharmaceutical Company Exec to Join Board


General Motors Co. said Friday it is nominating the CEO of Novartis International AG, a Switzerland-based pharmaceutical company, to join the board of directors, reported The Detroit News.

The Detroit automaker also announced longtime board member E. Neville Isdell, 71, will not stand for re-election to the board in June because of the board’s retirement policy at age 72. His retirement is the second for the board this year.

Joseph Jimenez, 55, who has served as CEO of Novartis since 2010, will stand for election at GM’s annual stockholders’ meeting June 9 in Detroit. With his addition, the board will have 12 members, including 11 non-employee directors.

“Joe brings a wealth of consumer insights gained from a distinguished career in the pharmaceutical and packaged goods industries, as well as a proven focus on enhancing shareholder value over time,” GM Chairman Tim Solso said in a statement. “We look forward to leveraging his expertise in product innovation and global consumer markets.”

Jimenez joined Novartis in 2007, and previously served as non-executive director of AstraZeneca PLC, in the United Kingdom and as an adviser for the Blackstone Group, a private equity organization in the U.S. He also has held senior leadership positions at H.J. Heinz Co. and Clorox Co., where he began his career in 1984.

Isdell, former chairman and CEO of the Coca-Cola Co., has served on GM’s board since July 2009 when it emerged from bankruptcy and was on the board for General Motors Corp. from 2008 to 2009.

Solso and GM CEO Mary Barra thanked Isdell for his leadership and contributions to GM.

“We have made significant progress and benefited greatly from Neville’s insight and experience, especially in global brand management,” Barra said in a statement.

Last month, GM said Erroll B. Davis, a retired superintendent for Atlanta Public Schools, had notified the company he plans to retire from the board and wouldn’t seek re-election at the company’s annual meeting. Davis, 70, joined the GM board in July 2009 and previously served as a member of the General Motors Corp. board from 2007 to 2009.

In February, GM’s board added Linda Gooden, former executive vice president of Lockheed Martin Corp. Gooden, 62, started her career at the former Packard Electric Division of GM.

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