GM News: GM CEO Wants To See More Cuts

[William Maley]

For the first half of this year, General Motors posted a profit of $6.3 billion, making it the best start in over two-decades. However, GM CEO Dan Akerson wants the company to do better.

$6.3 Billion is nothing to scoff at, but Akerson points out that figure equates to a 6% margin. He wants to see GM beat out the 7% margins realized by Ford & Volkswagen.

So how will GM do it? By cutting. GM has put forth plans to have just 14 global architectures by 2018, a dramatic drop from the 30 architectures in use. Also, GM will cut down their engine platforms from 20 to 10 in the same time frame.

Akerson is also targeting the company’s marketing efforts to help cut costs. GM's Chief Marketing Officer Joel Ewanick wants to have 10 agencies for the whole group.

Source: Bloomberg

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[hyperv6]

If the economy does not get better the cuts will become very important. GM needs to make the cuts in areas where they are not efficent and not cut development of technology, quality and design. The future depends on these and cuts here will send them back to where they just come from.

[Robert Hall]

14...hmm

Gamma II

Delta II

Epsilon II

Theta-Epsilon

Lambda

Global compact truck

US full size truck

Global van

Corvette

Alpha

Zeta II

and 3 more..(maybe older platforms for South America or Chinese markets? Or Chinese-market only paltforms?)

Edited November 9, 2011 by Cubical-aka-Moltar

[Z-06]

I like his approach better than VW strategy to become #1 by 2018.

[G. David Felt]

This will drive to faster change over of platforms with new fresh models. I like his goal, driving to 7% margin is a good goal and I agree better than trying to be #1 in the world. Just look at what it did to GM, then Toyota and Now I guess we can watch VW go POOF!

[daves87rs]

I like his approach better than VW strategy to become #1 by 2018.

+1

[Drew Dowdell]

I wonder how Ford manages it with the debt load they are still carrying.

[ZL-1]

If the economy does not get better the cuts will become very important. GM needs to make the cuts in areas where they are not efficent and not cut development of technology, quality and design.

Exactly.

[Drew Dowdell]

14...hmm

Gamma II

Delta II

Epsilon II

Theta-Epsilon

Lambda

Global compact truck

US full size truck

Global van

Corvette

Alpha

Zeta II

and 3 more..(maybe older platforms for South America or Chinese markets? Or Chinese-market only paltforms?)

Omega

[Camino LS6]

Couple this with more bodystyles per platform and we might have something.

[Drew Dowdell]

I think that is exactly what they are planning. This is "One GM" just like Ford's "One Ford" without the marketing ploy behind it.

The Focus platform is getting something like 14 different body styles. We may not get them all, but we'll get most.

[Camino LS6]

It's such a no-brainer to do things that way - you have to wonder why they ever abandoned such a viable model.