CEO: GM Can Be Competitive Amid Restructuring At the auto show in Detroit this week, CEO Rick Wagoner tells NPR that General Motors plans to scale back its brands and models, but it will continue to invest in electric cars. "I actually feel confident that GM is going to be very well positioned to compete in the future," he says.
NPR logo

CEO: GM Can Be Competitive Amid Restructuring

  • Download
  • <iframe src="" width="100%" height="290" frameborder="0" scrolling="no" title="NPR embedded audio player">
  • Transcript
CEO: GM Can Be Competitive Amid Restructuring

CEO: GM Can Be Competitive Amid Restructuring

  • Download
  • <iframe src="" width="100%" height="290" frameborder="0" scrolling="no" title="NPR embedded audio player">
  • Transcript


From NPR News, this is All Things Considered. I'm Melissa Block.


And I'm Michele Norris. First, this hour, to the auto show in Detroit and the future for General Motors. GM sold 23 percent of the new vehicles bought in the U.S. last year. That's more than any other car company, but it's still about half of what GM's market share was back in 1980. The nation's biggest auto maker is staying alive, thanks to $13.4 billion in federal loans. Our co-host Robert Siegel is at the auto show, where he spoke with the man in charge of GM.

ROBERT SIEGEL: I asked Rick Wagoner, who is GM's CEO and chairman, about the project that his company is promoting most enthusiastically here, the Chevrolet Volt. It's a plug-in. It's scheduled for production in late 2010. I asked him how long it could be before it's a major-selling GM car, not just a niche product.

Mr. RICK WAGONER (CEO and Chairman, General Motors): Well, this is, in some sense, an all-new technology for our industry. And we have a lot of things that we need to do to make that technology not just meet the quality and durability standards, but also to be cost competitive. And my own view is that the opportunity for these to develop into high-volume vehicles is quite good, but to be honest, it's going to depend on our ability to work on things like getting the cost down. And it's going to be very much dependent on government policies which support the growth of electricity in vehicles.

SIEGEL: Let's say the Chevy Volt that you're showing off here, if that car hit the market in 2010 or 2011, how expensive of a vehicle is it?

Mr. WAGONER: It's a very expensive vehicle. We're going to have to price it in a way that tries to balance the fact that it is a new technology, great features, will be eligible for certain government tax credits, which will help the consumer to defray the cost. But from our standpoint, obviously, it's a new technology. It's going to cost significantly more than the consumer will be willing to pay for it. So, we're going to have to take some losses on that vehicle for a while in order to advance the technology.

SIEGEL: I read that at the 1997 auto show, an automotive writer was interviewing you about GM's market share, and you were dismissing the possibility of getting back to majority of the cars sold in the U.S. But 33 percent market share seemed, you said, seemed to be a reasonable share to be talking about. It's more than 10 years later; you're more than 10 points lower than that. It makes one wonder, have the past 10 years really been this turnaround that we've heard about at GM? Or if we sustain you, being the kind of car company that you are, are we just deferring the date of your demise?

Mr. WAGONER: No, I actually feel confident that GM is going to be very well-positioned to compete in the future in the U.S. and around the world. I mean, during that same 10-year period, we've grown from basically no business in the fastest-growing market in the world, now the second largest, China, to be the number one manufacturer there - number-one non-Chinese manufacturer. We have the leading position in important growth markets in South America, like Brazil. We moved to be the number one, from a position of basically almost no sales, to be the number one non-domestic player in a big-growth market like Russia. So, I think we've demonstrated that on a level playing field, we can compete with anybody.

It's fair to say that in the U.S. over that 10-year period or little longer, the last 15 years, we've put $103 billion to fund post-retiree health care and pensions. And that has been a drag on our ability to invest in all the things we would like to do in the market to support our brands and products. But the good news is - we think that is, with the agreements that we structured with our unions over the last several years, something that is now pretty much behind us. And so I think going forward, we'll be able to compete on more of a level playing field.

SIEGEL: What do you seem - to think back on that figure of 33 percent from more than a decade ago, that indeed GM can survive in the U.S. market at 23 percent of the market share, is that sufficient to keep a company of this size in business?

Mr. WAGONER: It is. We've structured - as we put our plans together, we're structuring the business in a way, whether it's our manufacturing capacity or the number of dealers that we need to support, is being structured on the basis that we can be not only competitive in the marketplace, but profitable financially at that kind of market share - and conservative forecast of the U.S. market as well.

SIEGEL: It illustrates a criticism of GM, of GM's structure. When I look at the columns of the sales figures for all of the brands and models of GM and then Toyota, the list of all the GM brands and models is more than twice as long as the list of Toyota brands and models that they're selling in the U.S. And I've read critics saying, you've inherited a structure from the days when this was the 60-percent share of the market. You're selling too many different kinds of cars and too many different kinds of dealerships, and too many different models. Is that true? Do you think that that's a structural problem that you have to change at GM?

Mr. WAGONER: Yes, well, I mean, as we indicated in our submission to Congress, one of the things reflecting a reality of a lower U.S. industry, it does require us to not just consolidate the number of manufacturing plants and engineering centers, but also dealer networks, and we indicated we were reviewing several brands and deciding what their future is going to be. And as part of that, also, reducing the number of product entries. I still think it's important. This is a huge market, and there is a diversity of demand for different kind of vehicles. So, GM is going to offer a full range of vehicles. But certainly from the perspective of being efficient and competitive from a cost perspective, we do need to narrow the range.

SIEGEL: Rick Wagoner, thank you very much for talking with us.

Mr. WAGONER: Thanks, great to be with you. I really appreciate it.

SIEGEL: Rick Wagoner is chairman and CEO of General Motors. I spoke to him at the auto show in Detroit.

Copyright © 2009 NPR. All rights reserved. Visit our website terms of use and permissions pages at for further information.

NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.