Mary Barra signals full-speed ahead for General Motors today in her first financial report as CEO, saying “there is no right or left turn” from the strategy laid out by the automaker’s previous leadership.
“The real opportunity is to accelerate,” she tells journalists and Wall Street analysts in a conference call to detail GM’s $3.8 billion profit last year.
“It’s keeping a strong customer focus. We’ve got to continue to make sure we’ve got the right vehicles out there with the right quality. We have more to do, but we’re on it, on building strong brands. We need to continue to maintain our fortress balance sheet, (and) one of the key focuses is to operate profitably everywhere,” Barra says on her 22nd day as the first female CEO of a major automaker.
Barra’s first financial report also marks the 16th consecutive quarter of profitability for GM since emerging from bankruptcy in 2009.
Pressed by analysts to divulge risks that may lie ahead in her tenure, Barra calls herself “a glass half-full person” who prefers to look at business challenges as opportunities.
Those include supporting GM’s brand-rebuilding effort with more product homeruns, recalling at one point record global sales last year for Buick and Chevrolet and Cadillac’s ascension to the fastest-growing volume luxury brand in the U.S. as proof it is on the right course.
Barra also thinks GM has additional room to grow its business in China, where the automaker holds a leadership position but believes the addition of more Cadillac vehicles there will richen its product mix. She says more work must be done to heighten Chevrolet’s position in China, as well.
“And we’ve got to focus on maintaining our cost structure,” she adds, citing material and logistics costs as two key areas ripe for shrinking.
Barra, who took over last month for a retiring Dan Akerson after 33 years at the automaker in jobs ranging from the factory floor to the executives suites at GM world headquarters in Detroit, plans to stay the course on truck pricing, too.
GM launched redesigned large pickups last year, arguably the automaker’s most important new products in a decade, and the windfall of sales many industry watchers expected has not materialized.
In December, the Chevy Silverado and GMC Sierra failed to combine for a year-over-year sales increase, and in January deliveries of the trucks were the weakest GM has seen since January 2012.
GM’s share of the large-pickup market in the U.S. fell to 36.5% last year from 37.2% in 2012, according to WardsAuto data. In the middle of the last decade, GM’s share was more than 40%.
Barra insists she will not hit the panic button and discount to gain share, as GM may have done prior to restructuring.
“We’re very confident in the product,” she says, citing a number of third-party awards for the pickups. “We are still getting all the plants online that build that vehicle.
“We still have room to get going. We will maintain our pricing disciple, but we will also look and react to the market to make sure we are competitive.”
The conference call itself did not deviate from the structure of recent years, which shortly after the bankruptcy was pared down to global highlights and eliminated a question and answer session for journalists. Barra provided 10 minutes of opening remarks, followed by a more detailed walk through the report by newly appointed Chief Financial Officer Chuck Stevens. Barra closed the session with two minutes of final remarks.
GM’s 2013 profit result was down 22% on a weak fourth quarter, where net income rose a modest 2% to $913 million. But operating profits in North America surged 65%, and the automaker trimmed its losses in Europe during the October-December period to $345 million from $761 million.
Income from GM’s International Operations tumbled 69% to $208 million, as the automaker faced pricing pressure from Japanese competitors. China was the sole bright spot, contributing $400 million.
