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General Motors: Sales, Marketing, and Financial News

Old 03-06-2017, 06:03 AM
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PSA targets Opel turnaround as GM exits Europe | Reuters


France's PSA Group (PEUP.PA) has agreed to buy Opel from General Motors (GM.N) in a deal valuing the business at 2.2 billion euros ($2.3 billion), creating a new European car giant to challenge market leader Volkswagen (VOWG_p.DE).

The maker of Peugeot and Citroen cars vowed to return Opel and its British Vauxhall brand to profit, targeting an operating margin of 2 percent within three years and 6 percent by 2026 underpinned by 1.7 billion euros in joint cost savings.

PSA shares jumped as much as 5.2 percent after Chief Executive Carlos Tavares said GM's European arm could be turned around using lessons from the French group's own recovery. Opel recently recorded its 16th consecutive full-year loss.
"We're confident that the Opel-Vauxhall turnaround will significantly accelerate with our support," he said.

By acquiring Opel, PSA leapfrogs French rival Renault (RENA.PA) to become Europe's second-ranked carmaker by sales, with a 16 percent market share to VW's 24 percent.

The disposal seals GM's exit from Europe and ends a relationship dating back to the 1920s.

Eight years after coming close to a sale to Canada's Magna (MG.TO), the Detroit car giant has faced renewed investor pressure to offload the business to raise profitability, rather than chase the global sales crown currently held by VW.

Last year, PSA and GM Europe recorded a combined 72 billion euros in revenue and 4.3 million vehicle deliveries.

GM will receive 1.32 billion euros for the Opel manufacturing business in the form of 650 million euros in cash and 670 million in PSA share warrants.

An additional 900 million euros will be paid by the Paris-based carmaker and BNP Paribas (BNPP.PA) for Opel's financing arm, to be operated jointly and consolidated by the French bank.


'PROUD NOT RELIEVED'

After fending off 2015 merger overtures by Fiat Chrysler (FCHA.MI) with support from her board, GM boss Mary Barra agreed to target a 20 percent return on invested capital and pay out more cash to shareholders.

"The way I look at this is positioning Opel-Vauxhall to be incredibly successful in the future," Barra said on Monday when asked by a reporter whether she was relieved.

"General Motors doesn't have to be relieved," PSA's Tavares interjected. "They can be proud of giving Opel-Vauxhall a better future."

PSA shares were up 2.2 percent at 19.49 euros as of 0939 GMT, after reaching 20.06 euros earlier in the session. GM shares closed 1.2 percent higher on Friday after Reuters reported a deal had been struck.

The two carmakers, which already share some production in an existing European alliance, confirmed last month they were negotiating PSA's outright acquisition of Opel, sparking concern over possible job cuts.

Tavares said on Monday the targeted savings would come from purchasing and research and development - avoiding plant closures - as the Opel lineup is redeveloped with PSA technology and vehicle architectures.

An ambitious technical convergence push will begin with the Opel Corsa, the CEO indicated, as earlier reported by Reuters.

The next version of the popular subcompact will be delayed by a year to 2020 as it goes back to the drawing board, according to presentation slides shown to analysts.

"Our planning teams are already working on that," Tavares said when questioned about the model. Another five PSA-based Opel vehicles will follow by 2023.

LABOR COSTS

The Opel deal caps a stellar two-year recovery for PSA, which avoided bankruptcy in 2014 by selling 14 percent stakes to the French state and China's Dongfeng (0489.HK), matching the Peugeot family's diluted holding.

Tavares has since cut about 3,000 French assembly line jobs each year through voluntary departures to trim the wage bill to 11 percent of revenue from the 15 percent level he inherited - which is roughly where Opel's labor costs stand today.

PSA reiterated pledges to run Opel as a distinct German subsidiary and honor existing job guarantees, which tend to cover production plans for existing models.

Beyond those horizons, however, the outlook for Opel plants may be less certain.

"Tavares wants to create healthy competition between the plants," said one person involved in the tie-up talks. "They will be competing for workload."

With Europe's auto market near a peak, some analysts expect the new group to close two or three plants within five years. Britain's European Union exit adds to the uncertainty over Vauxhall's UK plants at Ellesmere Port and Luton.

But Tavares said exports could help fill Opel plants, adding that UK manufacturing brought opportunities as well as risks in the event of a "hard Brexit" in which Britain leaves the EU without a free-trade deal.

"This may look to you a little bit romantic," he conceded.

The transaction also sees GM retain most of Opel's pensions deficit, estimated by analysts at $10 billion. Earlier in the talks, the U.S. carmaker had sought to offload a larger share of the liabilities, sources said.

Some smaller pension funds will be transferred to PSA, along with a 3 billion euro payment to cover their full settlement, the companies said on Monday.

Existing Opel models will be barred from entering new overseas markets under "non-compete" agreements that had also complicated negotiations - while GM will be similarly excluded from marketing the same underlying technologies in Europe.

The PSA warrants, exercisable in five years and maturing in nine, provide a financial incentive for GM to continue cooperating. The U.S. carmaker has agreed to sell the shares received upon exercise, keeping no stake in PSA.

The Opel sale cuts GM's cash balance requirement by $2 billion, the company said, allowing it to accelerate share repurchases. GM will also take a charge of $4 billion to $4.5 billion on the deal, expected to close in late 2017.
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Old 03-06-2017, 08:00 AM
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Not sure where Buick is going to rip off their designs from now. Opel saved Buick in the US.
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Old 05-25-2017, 02:06 PM
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Old 05-25-2017, 03:06 PM
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I've always wanted a diesel off road rig damnit.
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Old 05-25-2017, 05:24 PM
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Originally Posted by kurtatx View Post
I guess everyone did it.
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Old 05-25-2017, 06:17 PM
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Originally Posted by AZuser View Post
I guess everyone did it.
They almost have to audit all US diesels now
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Old 05-25-2017, 08:22 PM
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Perhaps indicative of why Honda, Toyota, and Mazda have been so reluctant to and still haven't brought diesels over despite people clamoring for them.

Those three were just off the top of my head.
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Old 05-25-2017, 08:34 PM
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Originally Posted by Costco View Post
Perhaps indicative of why Honda, Toyota, and Mazda have been so reluctant to and still haven't brought diesels over despite people clamoring for them.

Those three were just off the top of my head.
How convenient Mercedes mysteriously pulled bluetec models from the US
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Old 04-13-2018, 03:42 PM
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UPDATE GM to cut second shift at Lordstown; 1,500 jobs affected vindy.com

GM to cut second shift at Lordstown; 1,500 jobs affected

April 13, 2018

LORDSTOWN

This afternoon General Motors Lordstown Assembly Complex employees were informed that the second shift at the plant will be eliminated.

There will be 1,500 workers affected by the elimination that will take place June 15. One shift production will begin June 18. GM also announced a special attrition program to employees that could affect the number of people actually laid off. Sales of the plantís compact car product, the Chevrolet Cruze, have declined for months. March marked the 11th consecutive month of sales declines for the Cruze. Last year, the plant lost its third shift and saw more than 10 weeks of down time because of the trend away from small cars.

The news comes after the United Auto Workers Local 1112 President Glenn Johnson was ousted by former UAW 1714 President Dave Green earlier this week. Earlier this year, the UAW 1714 and UAW 1112 merged to secure the future of GM Lordstown, union leadership said at the time.

Some good news for the plant came last week when GM announced the 2019 Cruze would be released later this year with an upgraded face and new features.
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Old 07-25-2018, 10:29 AM
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GM: $36.59 : -$2.89 (-7.32%)

Tariffs

https://www.wsj.com/articles/gm-post...sts-1532517368

GM Posts Higher Profit, Lowers Outlook Amid Steel, Aluminum Costs

Auto maker says commodity costs in the quarter were about $300 million higher than a year earlier

July 25, 2018

General Motors Co.’s second-quarter net income rose amid strong results from its in-house finance arm and China, but the auto maker lowered its 2018 profit outlook based partly on unexpectedly high raw-materials costs in the wake of U.S. tariffs on steel and aluminum.

GM on Wednesday said net income attributable to common shareholders totaled $2.4 billion for the April-to-June period, up 44% from a year earlier. GM said commodity costs in the quarter were about $300 million higher than a year earlier.

The nation’s largest car company by sales said it expects raw-materials costs to rise well beyond what it expected when it set its profit guidance at the beginning of the year. A combination of higher commodity prices—primarily steel and aluminum—and unfavorable foreign-exchange rates in South America will result in a hit of about $1 billion more than what the company originally forecast.

GM reduced its 2018 earnings-per-share forecast to $6, from a range of $6.30-$6.60. Analysts had forecast EPS of $6.41.

teel prices have risen sharply since spring, when the Trump administration signaled its plan to put a 25% tariff on steel and 10% on aluminum. The metals account for more than half the content in a typical automobile. The tariffs took effect June 1.

GM said second-quarter operating profit excluding one-time factors was $1.81 per share, surpassing Wall Street expectations of $1.78 per a share.

Revenue from continuing operations dipped less than 1%, to $36.8 billion, near the average analyst forecast of $36.9 billion.

GM’s downgraded profit outlook signals a likely end to a three-year string of record adjusted-operating profits, which totaled $12.8 billion in 2017. GM originally had forecast this year’s bottom line to be in the same range as last year’s.

The strong economy and job market have helped U.S. vehicle sales remain near record levels, while GM and other auto makers have benefited from a consumer shift toward larger—and more profitable—rides like pickup trucks and sport-utility vehicles. U.S. auto sales have been on an unusually long run since the Great Recession, as American buyers have taken advantage of low interest rates and attractive lease deals.
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Old 11-26-2018, 10:37 AM
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http://www.autonews.com/article/2018...-north-america

GM may close up to 5 plants in North American restructuring in 2019

November 26, 2018 @ 9:40 am

DETROIT -- General Motors said it will significantly cut its salaried workforce and could close up to five plants in North America, including three assembly plants, as part of overhaul of its North American operations in 2019.

The automaker on Monday said Lordstown Assembly in Ohio, Detroit-Hamtramck Assembly in Michigan and Oshawa Assembly in Canada will not be allocated any products beginning in 2019. Propulsion plants in Maryland and Michigan also will not be given any product.

All of the products currently being assembled at those three plants are expected to stop being produced by the end of 2019.

GM expects the announced actions to annually contribute to $6 billion in cash savings by 2020, including $4.5 billion in cost reductions and $1.5 billion in lower capital expenditures.

Not allocating product doesnít meant the plants will close, but it puts their future and the jobs of roughly 6,300 hourly and salaried factory employees -- 3,300 in the U.S. and 3,000 in Canada -- at risk heading into contract negotiations with the UAW in 2019 and Canadian union Unifor in 2020.

GM also announced it will close two unidentified assembly plants outside of North America by the end of next year and restructure its salaried workforce.

The salaried workforce restructuring includes cutting 15 percent of its 54,000 salaried employees in North America, including slashing global executives by 25 percent.

It was expected that GM, which announced the overhaul Monday, needed to address underutilization of its plants. The announcement comes ahead of negotiations with the UAW in 2019 and Unifor in 2020 is uncommon.

GM represents 1 million of the 3.2 million units of underutilized capacity in the U.S. through October, according to the Center for Automotive Research.

The manufacturing overhaul follows recent cost-cutting measures by GM such as offering buyouts to 18,000 salaried employees and exiting or restructuring unprofitable markets such as Europe and South Korea.

Oshawa currently has two assembly lines. The flex line produces the low-volume Cadillac XTS and Chevrolet Impala while the truck line produces the light- and heavy-duty Chevrolet Silverado and GMC Sierra pickups. It employs 1,542 employees, including 1,348 hourly union workers.

Detroit-Hamtramck currently builds the Chevrolet Volt, Chevrolet Impala, Buick LaCrosse, Cadillac CT6. U.S. sales of the Impala were down 13 percent through September.

Lordstown, which has dropped from three shifts to one in recent years, exclusively produces the Chevrolet Cruze. Sales of the compact car were down 27 percent through September, GM said.
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Old 11-26-2018, 04:42 PM
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GM is dropping 6 sedans from it's lineup with these plant closures. I'm guessing this, along with Ford dropping all sedans next year, is the beginning of the end for sedans in the US market.
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Old 11-26-2018, 08:14 PM
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It will be interesting to see what Toyota, Honda, and the Germans do. The Cruze and Impala just don't sell like the Japanese models. I feel terrible for those workers and their families.
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Old 11-27-2018, 05:54 AM
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Chevy still has the Sonic and Malibu and Cadillac will be adding the CT4, CT5 and the production version of the Escala.

Also, the CT6 hasn't been discontinued (at least not yet), production will just occur elsewhere.
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Old 11-28-2018, 07:56 AM
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Why GMís mistaken bet led to major layoffs

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Old 01-02-2019, 03:02 PM
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WASHINGTON -- General Motors hit 200,000 total electric vehicles sold in the United States by the end of 2018, reaching a threshold that triggers a phaseout of a $7,500 federal tax credit over the next 15 months, a person briefed on the matter said Wednesday.

The largest U.S. automaker reached the figure in the fourth quarter of 2018, which means the credit will fall to $3,750 in April, and then drop to $1,875 in October for six months. The credit will completely disappear by April 2020. The 200,000 figure covers GM's cumulative EV sales since 2010.

The tax credit is aimed at defraying the cost of electric vehicles that are more expensive than similarly sized internal combustion engine vehicles. In 2009, Congress set the phase-out threshold at 200,000 vehicles per manufacturer.

GM, which said previously it expected to reach the 200,000 sales figure before the end of 2018, declined to comment ahead of the release of its quarterly sales results on Thursday.

GM and Tesla Inc., which hit the 200,000 figure in July 2018, have both lobbied Congress to lift the cap or extend the existing tax credit. Tesla's EV tax credit fell to $3,750 on Tuesday and Tesla said it was cutting prices on its EVs by $2,000 to partially offset the lower tax credit.

In March, GM CEO Mary Barra called on Congress to expand the consumer tax credit for electric vehicles as the company boosted production of the EV Bolt in response to consumer demand. She repeated the request last month during a visit to Capitol Hill.

GM said in November it was doubling resources allocated to developing electric and self-driving vehicles as part of a significant restructuring that includes ending production at five North American plants. GM also announced it would halt production of the plug-in hybrid Chevrolet Volt by March.

https://www.autonews.com/sales/gm-so...-us-tax-credit
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Old 01-02-2019, 03:08 PM
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Good luck with that in the current political climate.
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Old Yesterday, 11:11 AM
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https://jalopnik.com/chevrolet-pulls...ged-1831800283

In a recent ad campaign, Chevrolet made the claim that their cars are “more reliable” than Honda, Toyota, and Ford. This claim is based on some very selective survey data that Chevy sponsored. Toyota has disputed Chevrolet’s claim—and now the ad’s been pulled from the rotation.

The ad that came out early January is just one in a long line of cringe-inducing “real people” commercials, only this time it was, Chevy “surprising” people when it comes to reliability. In case you missed it here it is again:

Last week I detailed how some of the variables in the study were not released and therefore Chevrolet was able to make a technically correct claim about the reliability of their 2015 model year cars using a narrow operational definition and a selective data set.

However, your average consumer may take issue with this definition of “reliability” and may feel that Chevrolet is being a bit deceptive in their presentation of the data.

I was sent a tip from a salesperson at a Toyota dealer who received a communication from Toyota corporate addressing this ad. It seems the “real people” at Toyota called Chevrolet out and now the ad is being pulled from the rotation.

So then I went to Chevrolet’s YouTube channel and while the video’s hyperlink is still live, the ad is no longer on the playlist when you sort by date starting with the most recent ad.

I reached out to representatives from both Chevrolet and Toyota. A Toyota spokesperson said:

“Toyota corporate did send that message to our dealers.

Our understanding is Chevy has decided to pull the ad.”
Chevrolet responded by saying:

Chevrolet stands by the reliability claim and the ad. The ad is part of a series of creative executions of our campaign that we have been using to promote the brand overall, the all-new Silverado, our crossovers and the most affordable vehicles in our lineup. We regularly make adjustments to our advertising and media strategy to support our business needs and it should be no surprise that our primary focus is on launching our all-new Silverado, therefore we will be debuting additional new Silverado creative in the coming week that will take the place of the reliability ad. We have not altered our marketing campaigns because of any concerns with the accuracy of our ad content.
The Chevrolet rep did not directly refute the Toyota’s claim that the ad was challenged by Toyota and therefore pulled out of the rotation. Often brands will run multiple commercials for their various products during the same time frame, so this makes us wonder: if Chevy is just moving on not “concerned about the accuracy of the content,” why pull the ad completely and no longer make it available on their playlist?

The Detroit News also has a bit more detail on the back and forth, which also included Ford and Honda.

Ford, Honda and Toyota confirmed they each challenged the 60-second TV spot, which aired in Metro Detroit during the North American International Auto Show. Its title: “Chevy Surprises Competitive Owners When It Comes To Reliability.”

A lawyer for one of the three automakers who challenged the ad sent an email to GM’s legal counsel this month demanding that the automaker stop making the reliability comparison claims in its advertising campaign, according to sources familiar with the correspondence. GM was given until 5 p.m. Jan. 14 to respond to the demands.

In a verbal response, a lawyer for GM told a counterpart at one of the rival automakers that Chevrolet is moving in a different marketing direction as it ramps up its campaign for the new Silverado pickup trucks, the sources said. And the GM lawyer added that the ad already had stopped airing nationally, with plans to remove the commercial from local markets in the coming weeks, the sources said.
Of course, I am also looking forward to what Mahk has to say about all this.
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Old Yesterday, 03:47 PM
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"I am so surprised!" - Costco, a former Chevy owner

I didn't buy those ads for a millisecond.
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Old Yesterday, 03:57 PM
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The second I saw that ad I was like where did that research come from? I knew there was no way it was from a reliable source lol

The recent consumer reports put Chevy near the bottom and Toyota at the top.

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Old Yesterday, 04:46 PM
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I heard those commercials on my Spotify, definitely some very selective categories for Chvrolet to rank above Toyota & Honda.
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Old Yesterday, 04:53 PM
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Acura moved up!

But look at Audi and BMW!

You know it's bad when Chevrolet does an ad meant to surprise users with reliability and no one believes it.
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