California Autos Examiner

Tuesday, July 15, 2008

GM News Conference

Yawn...It's wicked early out here on the West Coast. To view updates, just keep hitting refresh. Please keep in mind that this has been typed as it occurs. There may be clarifications later on.

5:30AM - Employee broadcast has started.
5:32AM - Recapping previous announcements: Chevrolet Cruze, Next Gen Aveo, New, Efficient Engines, 4 Plant Closures, Review of Hummer
5:35AM - Operating Actions (10 Billion Cash Improvements end of 2009) Further reduction of truck capacity by 300,000 units by the end of 2009. Reduction/consolidation of promotional budgets, motorsports. Holding engineering budgets to 2006-2007 levels. Early ret, mutual sep, normal attrition. Health care coverage for U.S. salaried retirees over 65 will be eliminated, effective January 1, 2009. Affected retirees and surviving spouses will receive a pension increase from GM's over funded U.S. salaried plan to help offset costs of Medicare and supplemental coverage. No base compensation increase 2008/2009. No cash bonuses for executives. Limiting corp. capital expenditures. Delaying next gen full size pickup/suv, V8 engines development. Increase powertrain for small displacement, alt. fuel.
5:40AM - Deferring payments into the UAW VEBA trust until 2010. DIVIDENDS SUSPENDED IMMEDIATELY on common stock
5:42AM - Asset sales are being considered. Hummer being reviewed.
5:44AM - Sum total adds up to $15 billion in added liquidity.
5:45AM - Let's accentuate the positive. Chevrolet Cruze mid 2010, Equinox May 2009, Next gen Caddy SRX second quarter 2009, Cadillac CTS sportswagon next spring, CTS coupe summer 2009, Buick Invicta next spring, Saab 9-4x fall 2009

Below are images of the bullet points from today's announcements. Click to enlarge.

6:01AM - News Conference has started.
6:03AM - Recapping what we've already covered. Q&A coming up.
6:06AM - Question: Are you really aiming at the bottom? Answer: 14 million for 2008 and 2009 is on the very conservative side.
6:10AM - Question: White collar layoffs, involuntary? Answer: Vast majority will not require involuntary layoffs. We'll see how it goes.
6:12AM - Additional plant closures from component manufacturing? Answer: Early June announcements will be pulled forward.
6:15AM - Any message to the retirees who will lose health care? Answer: There will be a pension increase to help mitigate this, but no doubt it was a tough decision.
6:23AM - Future product questions. Chevrolet Cruze 1.4 Liter Turbo will get 9 MPG better than the Cobalt. Chevrolet Equinox 2.3L Direct Injection should be class leader.
6:32AM - Marketing cuts. Answer: Products like the Malibu and Vibe show the way. Motorsports will see cuts as it no longer speaks to the customer.
6:35AM - We've heard about Chevrolet, what about other divisions? Answer: Franchises will be abundantly be provided for. BPC will see sister (highly differentiated) to the Equinox. Caddy future lineup will have some modifications given today's climate. Product program has essentially been spared.
6:46AM - How do you make a profit on small cars? Answer: Now there is demand for smaller cars. Average transaction price is going up. Leaner in structural and fixed costs.

6:52AM - That's all folks! HOWEVER, please stay tuned as ACATT has a little something extra planned for today.

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