General Motors

General Motors

Contract talks between the United Auto Workers and Chrysler and Ford continue this week, after GM became the first to settle on the terms of a tentative agreement with the union, late Friday.

Officials with the union and the automaker will release details of the contract on Tuesday at an 11:00 a.m. press conference.

The Detroit News and Detroit Free Press report that the GM contract probably includes a signing bonus for workers if they agree to the deal, and a pay increase for entry-level workers.

Plus, GM is expected to agree to add more jobs in the U.S.

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Disappointing economic data seems to be rolling in more frequently these days. The U.S. economy grew "a meager 1 percent" from April through July (a downgrade from an earlier 1.3 percent estimate), and unemployment numbers show no signs of improving (here's a cartoon of people looking for work in downtown Portland).

Now, news of cuts in production at GM.

From the Associated Press:

General Motors is cutting its production of pickup trucks next month, a sign that truck sales aren't as robust as the company had hoped.

A GM spokesman says the company cancelled five scheduled overtime shifts on Saturdays in September and October. He didn't know how many vehicles would be involved, but the Flint, Mich., plant where the pickups are made can produce 900 trucks per day.

Full-size pickup truck sales were up 9 percent for the year through July in the U.S., compared with a year earlier, according to Autodata Corp. But that increase was smaller than the industry saw as a whole. Continuing weakness in the housing and construction sectors has dampened demand for trucks. Sales of the Chevrolet Silverado, GM's best-selling truck, were up 7 percent.

More jobs building batteries could be on the way at A-1-2-3’s factory in Livonia.  The company just won a big contract with General Motors. 

A-123 builds batteries for hybrid, plug-in hybrid and electric vehicles.  

The company recently hired its thousandth employee at the Livonia plant, and the new contract will likely mean more jobs in the future, perhaps hundreds more jobs.   

But General Motors is not revealing anything about the kind of vehicles it will put the A-123 batteries in, or where those vehicles will be sold. 

General Motors executives says the company is becoming less complicated, and less wasteful, than it was in the past.   

GM CEO Dan Akerson says that simplicity -- along with a "fortress" balance sheet, and a lower cost structure will help GM break even in bad times, and make money in good times. 

Akerson and other top executives gave investors an in-depth briefing of the company's post-bankruptcy progress and plans for the long-term future.

GM has reduced its brands in the U.S to four, will focus on Chevrolet and Cadillac as its primary global brands, and will use regional brands such as Opel to help the company compete in specific markets like Germany.

GM's drastically reduced debt load also frees the company to follow through with product plans.  In the past, the company had to abandon car programs during recessions because of the pressing need to make debt payments.

"We think, just on cancelled product programs, we’ve probably blown a billion dollars a year in the last few years, as a result of having to pull back from things we’d already started," said Chief Financial Officer Dan Ammann.

GM regained its number one global sales position in the first six months of this year.  But Akerson says being number one is not the goal.

He says GM must make the customer the first priority.  And GM will focus on profitability, not market share.

GM's head of global marketing Joel Ewanick said GM will also set its sights on a new "stretch" challenge: being the first automaker to get one of its brands on the list of the top twenty-five most recognized global brands. 

That list includes a number of U.S. brands, including Apple and Coca-Cola.  But no car company's brand has yet made it onto the list.

General Motors

A top GM executive said Thursday that the automaker wants to peg United Auto workers' pay to their job performance. Workers who turn out quality vehicles would benefit financially.

"We want to pay for the performance," GM North American President Mark Reuss told reporters at an industry conference.   “All of those things that I get measured on, I want everybody else measured on, too.”

That would be a big change at GM, where the current UAW contract expires Sept. 14.

James Marvin Phelps / Wikimedia Commons

General Motors made $2.5 billion in the second quarter. 

That’s slightly more than GM’s cross-town rival, Ford Motor Company made in the same period.    Ford made $2.4 billion.

But both companies are forecasting a dip in profitability in the second half of this year. 

Most of GM’s second quarter profit came from North America, as truck and Chevrolet brand car sales rebounded.  North American President Mark Reuss says the strong performance came despite the slow economy and some unexpected events.

“I didn’t think the debt ceiling crisis was going to happen, " Reuss told reporters at an annual auto industry conference in Traverse City.  "I didn’t think the tsunami was going to happen, all those things you don’t know what’s going to happen.  But if you’ve got a business and an operational model that can handle it and adapt quickly, then I think that’s the key."

General Motors may have beaten analysts’ expectations, but the company is not yet meeting investors’ expectations.

This is GM’s sixth quarterly profit in a row, a dramatic improvement compared to the years leading up to the bankruptcy.

Spacing Magazine / Flickr


GM sales rose almost 8% in July, while Ford sales rose 8.9% and Chrysler sales increased 20.1%.

From the Detroit Free Press:

The Detroit Three saw U.S. sales increase in July and gained market share, as a troubling economy and weeks of worries about the U.S. debt ceiling continued to hamper a recovery in auto sales.

Chrysler had its best July since 2007 to lead Detroit’s automakers with a 20.1% surge, off a 33% gain in sales to individual customers. General Motors’ U.S. sales rose 7.6% last month and Ford’s grew 8.9%. Japanese automakers continued to lose share to their American rivals as they recovered from the March earthquake and tsunami in their country.

GM forecast July industrywide sales of light cars and trucks were flat from the previous year and slightly better than June. Consumers stayed out of showrooms amid news of climbing unemployment and bitter debate over raising the U.S. debt ceiling to prevent the country from defaulting on its loans tonight. President Barack Obama signed legislation today to prevent that scenario after the Senate approved the bill.


Original post:

From the Associated Press:

General Motors says its U.S. sales rose nearly 8 percent last month, led by fuel-efficient vehicles such as the
Chevrolet Cruze car.

user bull-doser / wikimedia commons

DETROIT (AP) - A lawsuit claims General Motors Co. fixed a defective part on police versions of the Chevrolet Impala but didn't correct the same problem in hundreds of thousands of other

The class-action lawsuit, filed last week in Detroit, says 2007 and 2008 model-year Impalas have defective spindle rods, which connect the suspension to the rear wheels. The defect misaligns the wheels, which makes the tires wear out faster.

According to the lawsuit, GM told dealers to replace the spindle rods and tires on affected police vehicles. It also authorized dealers to reimburse police who had purchased replacement tires.

But the suit says GM didn't offer the same remedy to non-police owners. The company sold 423,000 Impalas from those model years.

A GM spokesman was not immediately available to comment Tuesday.

wikimedia commons


General Motors and Ford both saw U-S sales rise more than 10 percent in June as lower gas prices brought more customers into its showrooms.

The fuel efficient Fiesta and Focus drove sales for Ford.

The new Chevrolet Cruze compact led GM's sales gain. Cruze sales were more than double those of the old Chevrolet Cobalt.

Don Johnson is the Vice President of U-S sales operations for General Motors. He says sales were led by smaller, more fuel-efficient models.

Original story:

General Motors says its U.S. sales rose 10 percent in June as lower gas prices brought more customers into its showrooms.

The Detroit car company says it sold 215,000 cars and trucks last month.

Don Johnson, the Vice President of U.S. sales operations for General Motors, says sales were led by smaller, more fuel-efficient models:

"What drove our success this month, as well as the last couple of months, is our ability to meet the needs of the consumers as they go looking for more fuel efficient vehicles," said Johnson.

The new Chevrolet Cruze compact led GM's sales gain. Cruze sales were more than double those of the old Chevrolet Cobalt.

GM's small-car sales were helped by earthquake-related shortages of Japanese cars.

U.S. Transportation Secretary Ray LaHood plans to visit General Motors Co. plants in Flint and Bay City on Wednesday to discuss the Obama administration's manufacturing job programs.

The stops are in the morning at the Flint plant and in the afternoon at the Bay City plant. LaHood's office says he'll hear reports on GM's plans to expand its production at the plants.

GM recently announced a $109 million plan for engine production for fuel-efficient cars such as the Chevrolet Volt. That plan will add or retain about 100 jobs in Flint and Bay City. The Flint assembly plant is also added a third shift to increase production of Silverado and Sierra pickup trucks.

Chrysler repaid $7.6 billion to the U. S. and Canadian governments back in May.

Recently, General Motors announced the addition of 2,500 jobs to its Hamtramck plant and plans to invest $130 million in a new data center in Warren, Michigan.

Michigan Radio's Jenn White helps us get a look at the political implications of the automotive industry’s progress.  She spoke with Susan Demas, political analyst for Michigan Information and Research Service and Ken Sikkema, former Republican state Senate Majority Leader and senior policy fellow at Public Sector Consultants.

Both Ford and General Motors today predicted they will expand their global presence, despite rising energy and commodity prices. 

GM held its first public stockholders meeting in Detroit – and Ford held its annual Investors Meeting in New York. 

GM CEO Dan Akerson told stockholders to consider the company a long-term investment, not short-term.  GM stock has lost a fair bit of value since the IPO in November.    

Raising Gas Taxes

Jun 7, 2011

Yesterday, as the congressman from New York was going through his excruciating televised confession, someone called to ask me, “why don’t we have any good sex scandals in Michigan?”

 The CEO of General Motors, Dan Akerson, told reporters today that he's concerned about the "jobless economic recovery" and high federal deficits.

From the Associated Press:

The CEO told reporters before the company's stockholders meeting Tuesday that the government should have a 10-year plan to cut its roughly $14 trillion deficit. He says that would bring much needed stability to markets.

General Motors will invest 130-million dollars in a new high-tech computer command center in Warren. 

The announcement follows a string of other investments by GM in North America. 

GM says the high performance computers at the new command center in Warren will help the company keep pace with the increasingly complex computer simulations required to build cars. 

It will also allow the company to keep its own data and customer data more securely.   


When it comes to fuel economy, Roger Clark says, "how you drive matters."

Roger is a fuel economy expert with Chevrolet. He has a few tips for getting more miles per gallon without buying a new car. We tested his driving style against Monte Doran’s, also with Chevy. Roger and Monte drove matching Chevy Cruzes and took identical routes. Both did a little highway and a little city driving on a weekday around 5pm. Roger followed his own fuel saving tips and Monte did exactly the opposite.

President Obama will visit a Chrysler plant in Ohio today, a day after the U.S. Treasury reached a deal to sell its remaining 6.6% stake in Chrysler to Fiat. 

Meanwhile, the Treasury still owns 26% of General Motors.  But GM North American President Mark Reuss says it’s up to the U.S. Treasury to decide when to get out of the car business completely. 

Reuss says the government’s part-ownership of GM matters to American taxpayers and customers.   It also matters to GM executives and workers.

But it's not up to GM when the Treasury sells its stock.

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LANSING, Mich. (AP) - General Motors Co. will add 2,500 jobs at a Detroit-area factory that now makes electric cars, investing $69 million so the plant can make two new Chevrolet sedans.

The factory, which straddles the border between Detroit and the small enclave of Hamtramck, now makes the Chevrolet Volt and its European counterpart, the Opel Ampera.

But GM announced on Wednesday that it will upgrade the factory so that it can run around the clock making the new Malibu midsize car and a revamped version of the aging Impala large sedan.

About 1,200 of the jobs will be new hires, since GM still has to recall about 1,300 laid-off workers in the U.S.

But in Michigan, which has among the highest unemployment rates in the nation, 1,200 new jobs is big news.

GM announced on May 10 that it would create or keep about 4,000 jobs by investing $2 billion in 17 factories in eight states.

The Detroit-Hamtramck announcement adds to previous expansion announcements in Bowling Green, Ky.; Toledo, Ohio; and Flint and Bay City, Mich.

"Filling this plant with new work is very satisfying because GM is dedicated to helping rebuild this city," Mark Reuss, the company's North American president, said in a statement.

GM said last week it would shut the plant down for four weeks starting in June, reconfiguring it to increase Volt and Ampera production from 16,000 cars per year to 60,000 next year in order to meet strong demand.

The shutdown also will let GM add equipment to build the 2013 Malibu midsize sedan at the plant starting next year. The car also will be built in Kansas City, Kansas.

In addition, GM said it will build a long-overdue new version of the Impala at the Detroit-Hamtramck plant.

GM will stop producing two other big cars at the factory, the Cadillac DTS and Buick Lucerne, later this year.

State tax breaks worth $10 million are leading to an investment in GM's Warren Tech Center.

Warren Mayor Jim Fouts indicated an announcement like this would be coming last month.

From the Detroit News:

General Motors Co. won $10 million in tax incentives from the state today to build a new information technology facility at its Warren Tech Center.

The $130 million project — expected to create about 25 permanent jobs — will add on to the Cadillac Building on the campus and occupy about 30-acres of land located along Van Dyke Avenue. The new jobs will pay an average of $44 an hour, according to the Michigan Economic Development Corporation.

The brownfield tax credits valued at $10 million were approved this morning by the Michigan Economic Growth Authority board.

The state brownfield tax credits involved in this deal won't be around for long. In Governor Snyder tax overhaul plan, approved by state legislators, the tax credits will be replaced with a system that will grant redevelopment money up front.

General Motors has announced it will invest a total of $2 billion in 17 of its U.S. plants. 

The investment also means the company will re-hire its 1,357 laid-off workers, and possibly hire hundreds of new workers, especially if demand for GM cars continues to improve.

At GM's Toledo Transmission plant, UAW members gather to hear about what it means for their plant:  a $200 million upgrade and the opportunity to build a new, fuel-efficient 8-speed transmission.

Brandon C / Flickr

A General Motors transmission factory will be adding 250 to 400 jobs, according to a union official quoted by the Associated Press.

The announcement will be made by CEO Dan Akerson and UAW Vice President Joe Ashton.

The AP reports:

A union official says General Motors plans to add 250 to 400 jobs at its transmission factory in Toledo, Ohio.

Emilio Labrador / Flickr

Higher commodity prices are translating into higher prices for cars and trucks.

GM announced their prices will go up - joining Ford and Toyota.

From the Associated Press:

General Motors says it will raise car and truck prices by an average of $123 per vehicle to make up for its increased oil and metal costs.

Lindsey Smith / Michigan Radio

A 2-million-square-foot former General Motors stamping plant in the Grand Rapids suburb of Wyoming will be demolished this year. Monday night Wyoming’s city council approved plans to destroy the 75-year-old building and redevelop the site.

Spacing Magazine / Flickr

Updated:  5:59 p.m.

Outgoing GM CFO Chris Liddell says he only began wrestling with whether to leave GM in the past few weeks, and he and boss Dan Ackerson have been discussing the subject only for the past week.

Liddell says he has no announcement to make as to his next job, but he thinks it will not be a chief financial officer position.

GM CEO Dan Akerson says the transition, from Liddell to his successor, current GM Treasurer Dan Ammanns, should be "seamless."

Akerson says he's committed to remain at the helm of GM for the next five years.  Dan Ammanns also stresses his plan to stay for the long term.

Investors in GM's initial public offering in November had been assured that GM's leadership would stabilize. 

Sheldon Stone is with Amherst Partners, a restructuring consultant firm.

Stone says some investors will likely be concerned about Liddell's departure.

"He (Liddell) was part of that road show, that went out pitching the IPO," says Stone.  "He had his fingerprints all over it. 

Stone says GM needs change.  But this may be too much change.

GM has had four CEOs in the past year.  Several senior executives have left GM in the past year.  And the deck of senior management has been shuffled and re-shuffled several times.

Ken Elias is an analyst with the consultant firm Maryann Keller & Associates. 

He says Liddell, formerly CFO of Microsoft, was brought to GM by former CEO Ed Whitaker, with the understanding that Liddell would be groomed as Whitaker's successor.

But months after Liddell began his new job at GM, Whitaker stepped down as CEO.  GM's Board chose Board member Dan Akerson to lead the company. 

Elias says that could account for Liddell's decision, after the IPO was completed, to leave GM.



General Motors says its Chief Financial Officer will step down as of April 1st. Chris Liddell will be replaced by Treasurer Dan Ammann. The Associated Press reports:

Spokeswoman Noreen Pratscher said Thursday that Liddell accomplished his goals of finishing an initial public stock offering and returning the company to sound financial footing. She says Liddell did not say anything about his plans for the future.

Under Liddell, GM posted four straight profitable quarters.

Spokeswoman Noreen Pratscher said Liddell accomplished his goals of finishing an initial public stock offering and returning the company to sound financial footing. She says Liddell did not say anything about his plans for the future.

The 52-year-old Liddell joined GM in January of 2010, about six months after it emerged from bankruptcy protection.

Chairman and Chief Executive Dan Akerson said Liddell was a major contributor to GM during a pivotal time in the company's history.

"He guided the company's IPO process and established a good financial foundation for the future," Akerson said in a statement.

GM reported net income of $4.7 billion last year, fueled by strong sales in China and the U.S. as the global auto market began to recover. It earned $2.89 per share on revenue of $135.6 billion.

It was the company's best performance since earning $6 billion in 1999 during the height of the pickup truck and sport utility vehicle sales boom.

Spacing Magazine / Flickr

Snowstorms in February didn’t seem to dampen car sales.  Sales were up 32-percent at Nissan, 42-percent at Toyota, and 46-percent at GM.

GM’s gain is for several reasons. Last February GM’s sales were weak, so this February looks much better in comparison. The company increased incentives in February. And it’s easier for GM customers to get financing now that GM has its own finance arm, GM Financial.

Don Johnson is head of GM’s U.S. sales.

"With their entry into the market, our penetration of the sub-prime business is above the industry average," says Johnson.  "We’ve also got GM Financial growing their prime lease business."

February sales were up 13-percent at Chrysler and 14-percent at Ford.

Two years ago, when President Obama decided to spend billions to prop up General Motors, and then to guide it  through a cushioned, “soft landing” bankruptcy, there were a lot of doubters. Many thought nature should have been allowed to take its course, and that the once-mighty General should have been allowed to die.

At the time, a commentator on NBC News said “As the GM bailout goes, so goes the Obama presidency.”

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General Motors says it earned $510 million in the fourth quarter and $4.7 billion last year as it continued an impressive comeback from bankruptcy.

It was the company's first profitable year since 2004 and GM's best performance since making $6 billion in 1999 during the pickup truck and SUV boom.

GM says fourth-quarter net income was fueled by strong sales in China and the U.S. as the global auto market began to recover. GM says net income per share was 31 cents, including $400 million in charges mainly for preferred stock dividends and for buying preferred stock from the U.S. government.

The quarterly profit was less than the two previous quarters. GM says expenses were higher because it launched two new vehicles. Revenue for the quarter was $36.9 billion.

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General Motors is expected to formally announce its first ‘full-year profit’ since 2004 on Thursday. It was just two years ago General Motors had to seek bankruptcy protection.    Now, the automaker is expected to announce a 5 billion dollar profit for 2010.

Aaron Bragman is an automotive analyst with IHS Global Insight.  He gives a big part of the credit to the federal government for helping GM through bankruptcy. 

“I don’t think we’d be in the place where we’re at right now if the government had not intervened and actually funded their bankruptcy.  We’d be in a very different place.”

 Bragman says 2011 might be another good year for GM, because of rising gasoline prices. 

 “Chevy is bringing several small vehicles to market.  The new Spark is on the horizon.  The new (Sonic) is coming this year.   So we’re actually seeing a lot of these small cars coming…and now we’re seeing a market force that may actually drive people to go an buy them.”

Bragman says high gasoline prices may hurt Chrysler, because it doesn’t have as many high- mileage vehicles to offer car buyers.

Spacing Magazine / Flickr

General Motors says most of its 26,000 white-collar workers will get bonus checks. The automaker says the bonuses will be between 4 and 16 percent of their base salaries. The Associated Press reports:

The company says in a statement Thursday that bonuses will be based on the performance of the worker and the company. GM made $4.2 billion in the first three quarters of last year and is expected to post a fourth-quarter profit shortly. The bonuses come just 19 months after GM needed a $49.5 billion government bailout to make it through bankruptcy protection.

The company says that more than 96 percent of the salaried workers will get bonuses of 4 to 16 percent of their base pay. Fewer than 1 percent will get 50 percent or more.