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December 8, 2009
General Motors Co. does not plan any job cuts in the immediate future, the company's new president of North America said this morning.
"We have no plans for that right now," Mark Reuss said in a call with reporters. "We are going to be focused on generating revenue, and we are not going to save our way into any kind of successful activity doing that."
Reuss and Susan Docherty, vice president of sales, service and marketing, provided an update on the automaker's North American operations. The executives received new titles last week in another reshuffling of the company's senior leadership. Reuss was named president of GM North America after serving briefly as vice president of engineering.
Docherty, meanwhile, expanded her role as vice president of U.S. sales, to include marketing and service operations. She is the first woman to head sales and marketing at GM.
Last month, former President and CEO Fritz Henderson said GM still had too many hourly workers and could slash some of the 6,000 to 7,000 workers currently on layoff. This year, GM has cut about 13,000 hourly workers as part of its court-ordered restructuring.
Reuss said there is a need for change within GM. "We need to focus on being the best, period," Reuss said. "The word 'competitive,' the words 'good enough' are all gone from the vocabulary of employees and need to be changed to 'winning,' 'to be the best.' "
GM still faces challenges to profitability, particularly in North America, where the automaker lost $651 million during the 80 days after emerging from bankruptcy July 10. The Detroit automaker said it will begin repaying $6.7 billion in federal aid starting with a $1.2 billion payment Dec. 31 and might fully repay the loan by June 2010, depending on the company's financial health. GM is required to repay the loans by July 2015 and will make payments of about $1 billion every quarter, at least until the second half of next year, the earliest that it plans an initial public stock offering.
GM stabilized market share in the third quarter but needs to grow market share as it shrinks from eight to four brands.
"What's different here is in the old GM, there was a tendency to buy our market share," Docherty said. "I don't want to get into the situation where we're just jamming cars out into the marketplace just to buy share. That's bad behavior that is not going to lead us to success."
Docherty has said she wants to cut the amount of incentives placed on the hoods of vehicles and manage production and dealer inventory as GM transitions from old products to new models.
Reuss agreed changes are needed so GM and dealers can both make money. "The initiatives and parlor tricks, that's not going to be going on here," he said.
GM still faces challenges to profitability, particularly in North America, where the automaker lost $651 million during the 80 days after emerging from bankruptcy July 10.
GM said it will begin repaying $6.7 billion in federal aid starting with a $1.2 billion payment Dec. 31 and might fully repay the loan by June 2010, depending on the company's financial health. GM is required to repay the loans by July 2015 and will make payments of about $1 billion every quarter, at least until the second half of next year, the earliest that it plans an initial public stock offering.
"We need to repay the money we borrowed. Everybody in the company wants that desperately," Reuss said.
The company wants to have a public offering of shares in GM next year, but sales and the automaker's success in coming months will determine the exact timing, Reuss and Docherty said.
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