Competitive Connection

February 4, 2008

What others are saying . . .
Rebound progress still lags for GM
General Motors Vice Chairman Fritz Henderson, in a blunt assessment of the automaker's standing, said that the company is still falling well short of a full-fledged turnaround.

The No. 1 U.S. carmaker is two years removed from its catastrophic performance of 2005, when a $10 billion loss left the company floundering in red ink and fending off rumors of bankruptcy.  GM has made laudable progress since -- narrowing operating losses, raising cash for a turnaround, bolstering sales in emerging markets and generating positive buzz at home.

Even success in some of the world's fast-growing emerging markets, such as China, India and Brazil, won't deliver a viable bottom line. GM has been growing consistently in foreign markets, with 59 percent of its sales now outside the United States.

"We've got to get the job done in the United States," Henderson said. "The emerging markets cannot carry GM."—Source: The Detroit News, January 30, 2008
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What others are saying . . .
Green vehicles provide other commuting benefits
A small but growing number of toll agencies around the world are giving discounts to owners of some alternative-power vehicles. The New York State Thruway Authority, the Port Authority of New York and New Jersey offer a discount to the owners of three hybrid models.

Owners of vehicles that get 45 miles a gallon on the highway and meet low emission standards can receive the discounts. The only vehicles that qualify are the Toyota Prius, the Honda Civic Hybrid and the Honda Insight models from 2000 to 2004 – only because later versions of the Insight don't meet the emission standards.

Toll discounts have been popping up in Europe, too. This year, Milan started levying a charge based on vehicle emissions in five engine classes. Owners pay $2.90 to $14.50 on weekdays from 7:30 a.m. to 7:30 p.m. London, which introduced congestion charges in 2003, will start charging a pollution fee on most buses and trucks entering much of the city. Electric cars and other clean vehicles are exempt.—Source: The New York Times, January 27, 2008
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Then & Now
Fewer IT systems is better
How many IT systems does it take to make a car? In the case of General Motors, the answer used to be over 7,000, whether for dealers, finance, manufacturing, or product development. That was before the automaker got religion about efficiently managing its computer files. It has now whittled down its IT footprint to a mere 2,400 systems.

GM’s efforts at paring down its IT systems are indicative of a trend within big OEMs. The quest is to make IT resources more manageable and speed up operations as well. "Users reside in 19 design and engineering centers in 16 countries that span 10 time zones. They sit in front of over 28,000 workstations, building geometries and generating or consuming data to create, engineer, and manufacture vehicles. Now, though, they all use the same single, core program," said Detlef Bielohawek, IS&S global director.--Source: machinedesign.com, Jan. 10, 2008
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A look at the competition
Ford says they have a new product development approach
Ford will step up the marketplace pressure, going to 3-year cycle times for most of its cars and trucks worldwide, says Derrick Kuzak, group vice president-global product development.

The accelerated vehicle cycle plan is a key part of Ford’s recovery strategy and will see the auto maker cut the average age of its Ford-brand product portfolio 35% from 2006 to 2009.

Most manufacturers make major changes to their vehicle lines every four years or more, depending on the segment of the market, with midcycle freshenings for many lines every two years or so. Many current Ford models have gone more than four years without serious upgrades.

Compared with 2004, Ford will be 49% faster at engineering a new vehicle top hat in 2008 and beyond, Kuzak says. It will be 27% quicker at creating an all-new vehicle. Design times will average eight to 14 months, depending on the program, he says.

To accomplish this, Ford is paring down complexity, reducing the number of engine architectures 25% by 2012 and re-using more parts from platform to platform and generation to generation. Overall, Ford cut the cost of developing a new top hat 20% between 2005 and 2007, Kuzak says. -- Source: wardsauto.com,
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What others are saying . . .
Toyota and GM sales race
General Motors just managed to keep Toyota from overtaking it as the world's biggest carmaker after the two companies reported virtually identical 2007 sales.

But Toyota has been the winner in financial performance. Its stock market value of $151 billion is more than 10 times that of GM. The Detroit carmaker's finances remain on shaky ground, with a credit rating deep in junk territory.

Toyota sold only 24 percent of its vehicles last year in Japan, where total sales were at their lowest since 1982. Markets outside the U.S. made up 59 percent of GM's sales.—Source: The Financial Times, January 24, 2008
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To read previous editions of the Competitive Connection or to access other information about manufacturing and labor at GM, visit http://www.gmmanufacturing.info