USA Today
DETROIT — GM told Wall Street on Tuesday that it will be the first global automaker to sell more than 2 million vehicles in China this year, portraying itself as poised for overseas growth a year after exiting bankruptcy protection.
General Motors executives are trying to convince investors that the new company, which emerged from U.S. government-led restructuring last July, is capable of making money for years to come because of its international strength and lower expenses.
The automaker, now a private company 61% held by the government, plans to sell shares to the public as early as the fourth quarter of this year.
Executives are also making the case that GM is clawing back from bankruptcy reorganization, when it needed a roughly $50 billion government bailout.
"All in all, we're the best-positioned U.S. automaker in the world's critical emerging markets," CEO Ed Whitacre told financial analysts during a presentation.
GM's market share in China is 13.3%, which it expects to rise marginally in the next few years. But GM's sales there will grow even with small market share increases because overall Chinese auto sales are expected to keep climbing, including a 20% jump this year to 16.5 million cars and trucks. China passed the U.S. last year as the world's largest auto market.
The automaker runs its GM China operation in a partnership with China's Shanghai Automotive Industry.
GM has led all automakers in sales to the Chinese the past five years, with sales up 67% since 2008, said Tim Lee, president of international operations.
GM plans to roll out nearly 70 new or upgraded vehicles in international markets by 2014, further strengthening its position, Lee said.
Buick is one of GM's most popular brands in China, and this month GM is rolling out first in China a new compact sedan, the Buick Excelle GT. It shares a design with the Chevrolet Cruze, due out this summer, but won't come to the U.S. until next year.
GM will use many car designs that will be distributed across the globe but also has vehicles that are designed specifically for markets such as South America.
Asian, European and South American units are the key to GM's sustained growth and profitability, executives said. GM also is on pace to sell more than 2 million cars and trucks in the U.S. this year. Through May, it sold more than 882,000.
Lee told analysts he is worried that competitors are building inventory in China, which may force discounts. So far GM has not had to cut prices, he said.
GM has repaid $6.7 billion of its financial aid to the U.S. government, but the remaining $43.3 billion was converted to equity. The government hopes to get at least part of the balance back in the public stock sale.
The company made $865 million in the first quarter and is cautiously optimistic that it will have a profitable year.
GM is also in the midst of restructuring its European operations, which long have been a money loser. Mark James, vice president and chief financial officer of Opel/Vauxhall Europe, said GM expects to break even in Europe by 2011 and be profitable going forward.
James said the company plans 8,300 layoffs that should be completed by the end of 2011, including 7,000 manufacturing workers. It also is seeking employee concessions worth $322.9 million per year, including wage freezes, benefit reductions and elimination of bonuses.
General Motors executives are trying to convince investors that the new company, which emerged from U.S. government-led restructuring last July, is capable of making money for years to come because of its international strength and lower expenses.
The automaker, now a private company 61% held by the government, plans to sell shares to the public as early as the fourth quarter of this year.
Executives are also making the case that GM is clawing back from bankruptcy reorganization, when it needed a roughly $50 billion government bailout.
"All in all, we're the best-positioned U.S. automaker in the world's critical emerging markets," CEO Ed Whitacre told financial analysts during a presentation.
GM's market share in China is 13.3%, which it expects to rise marginally in the next few years. But GM's sales there will grow even with small market share increases because overall Chinese auto sales are expected to keep climbing, including a 20% jump this year to 16.5 million cars and trucks. China passed the U.S. last year as the world's largest auto market.
The automaker runs its GM China operation in a partnership with China's Shanghai Automotive Industry.
GM has led all automakers in sales to the Chinese the past five years, with sales up 67% since 2008, said Tim Lee, president of international operations.
GM plans to roll out nearly 70 new or upgraded vehicles in international markets by 2014, further strengthening its position, Lee said.
Buick is one of GM's most popular brands in China, and this month GM is rolling out first in China a new compact sedan, the Buick Excelle GT. It shares a design with the Chevrolet Cruze, due out this summer, but won't come to the U.S. until next year.
GM will use many car designs that will be distributed across the globe but also has vehicles that are designed specifically for markets such as South America.
Asian, European and South American units are the key to GM's sustained growth and profitability, executives said. GM also is on pace to sell more than 2 million cars and trucks in the U.S. this year. Through May, it sold more than 882,000.
Lee told analysts he is worried that competitors are building inventory in China, which may force discounts. So far GM has not had to cut prices, he said.
GM has repaid $6.7 billion of its financial aid to the U.S. government, but the remaining $43.3 billion was converted to equity. The government hopes to get at least part of the balance back in the public stock sale.
The company made $865 million in the first quarter and is cautiously optimistic that it will have a profitable year.
GM is also in the midst of restructuring its European operations, which long have been a money loser. Mark James, vice president and chief financial officer of Opel/Vauxhall Europe, said GM expects to break even in Europe by 2011 and be profitable going forward.
James said the company plans 8,300 layoffs that should be completed by the end of 2011, including 7,000 manufacturing workers. It also is seeking employee concessions worth $322.9 million per year, including wage freezes, benefit reductions and elimination of bonuses.
No comments:
Post a Comment