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May 1, 2009

General Motors Announces Full Cooperation with Obama Administration

GM says it is poised to become a Leaner, More Viable Company.


General Motors Corporation has issued the following statement:

"We are deeply appreciative for President Obama's strong commitment and support of the American auto industry and its employees. Like him, we firmly believe that the best days of America's auto manufacturers--including Chrysler--lay ahead. GM remains focused on accelerating the speed of its operational restructuring and reducing the liabilities and debt on its balance sheet. We look forward to working with the President's Auto Task force to do so and are committed to transparent reporting of our restructuring every step of the way."

Earlier, it issued a Press Release on its Updated Viability Plan and Restructuring of U.S. Operations. General Motors' updated Viability Plan will speed the reinvention of GM's U.S. operations into a leaner, more customer-focused, and more cost-competitive automaker, the Release said.

The Viability Plan is included in an exchange offer whereby GM is offering certain bondholders shares of GM common stock and accrued interest in exchange for certain outstanding notes.

The Revised Viability Plan gives importance to the following points:

A focus on four core brands in the U.S. - Chevrolet, Cadillac, Buick and GMC - with fewer nameplates and a more competitive level of marketing support per brand.

A more aggressive restructuring of GM's U.S. dealer organization to better focus dealer resources for improved sales and customer service.

Improved U.S. capacity utilization through accelerated idling and closures of powertrain, stamping, and assembly plants.

Lower structural costs.




"We are taking tough but necessary actions that are critical to GM's long-term viability," said Fritz Henderson, GM president and CEO. "Our responsibility is clear - to secure GM's future - and we intend to succeed. At the same time, we also understand the impact these actions will have on our employees, dealers, unions, suppliers, shareholders, bondholders, and communities, and we will do whatever we can to mitigate the effects on the extended GM team."

GM in the U.S. will focus its resources on four core brands, Chevrolet, Cadillac, Buick and GMC. The Pontiac brand will be phased out by the end of 2010. GM will offer a total of 34 nameplates in 2010, a reduction of 29 percent from 48 nameplates in 2008. This four-brand strategy will enable GM to better focus its new product development programs and provide more competitive levels of market support, the Press Release clarifies.

GM anticipates reducing its U.S. dealer count from 6,246 in 2008 to 3,605 by the end of 2010, a reduction of 42 percent. According to GM, this reduction in U.S. dealers will allow for a more competitive dealer network and higher sales effectiveness in all markets.


Chevrolet Malibu

Photo: 2009 Chevrolet Malibu LT

Chevrolet Spark

Photo: 2010 Chevrolet Spark

Chevrolet Aveo

Photo: Chevrolet Aveo5 LT Hatchback.

Chevrolet Silverado

Photo: 2009 Chevrolet Silverado LT, Z71 Crew Cab

Chevrolet Volt

Photo: 2011 Chevrolet Volt Production Show Car

"We have strong new product coming for our four core brands: the Chevrolet Camaro, Equinox, Cruze and Volt; Buick LaCrosse; GMC Terrain; and Cadillac SRX and CTS Sport Wagon and Coupe," said Henderson. "A tighter focus by GM and its dealers will help give these products the capital investment, marketing and advertising support they need to be truly successful."

The Viability Plan also lowers GMNA's breakeven volume to a U.S. annual industry volume of 10 million total vehicles, based on the pricing and share assumptions in the plan. As a result of these and other actions, GMNA's structural costs are projected to decline 25 percent, from $30.8 billion in 2008 to $23.2 billion in 2010, a further decline of $1.8 billion by 2010 versus the February 17 Plan, the Press Release explains.

Another key element of GM's restructuring will be taking the necessary actions to strengthen its balance sheet. "A stronger balance sheet would free the company to invest in the products and technologies of the future," Henderson said. "It will also help provide stability and security to our customers, our dealers, our employees, and our suppliers."

"The Viability Plan reflects the direction of President Obama and the U.S. Treasury that GM should go further and faster on our restructuring," Henderson said. "We appreciate their support and direction. This stronger, leaner business model will enable GM to keep doing what it does best - provide great new cars, trucks and crossovers to our customers, and continue to develop new advanced propulsion technologies that are vital for our country's economy and environment."

Source: General Motors

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Edited & Posted by the Editor | 2:16 AM | Link to this Post

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