Thursday, September 30, 2010

Think GM is dead? Not on your life

Sacramento, California – The auto business is more cyclical than American politics, which is to say the pendulum tends to swing wildly every few years, and people have short memories when it comes to past history.

Right now, the prevailing logic says Ford can do no wrong, and General Motors is a mess.

Those assessments have the accuracy of a political TV ad, which is to say the truth has been stretched and mangled.

To be sure, Ford has done an incredible job lifting itself up over the past couple of years. Ford chief Alan Mulally and his team deserve high praise for the current Ford lineup of motor vehicles and the billions of dollars that have been pouring into the automaker’s coffers.

GM? Well, there’s that whole government bailout public relations disaster, criticism from seemingly all corners about its once-bloated lineup of oversized vehicles and the general smug satisfaction of folks who like to kick the nation’s top automaker when it’s down.

Yet on a global scale, GM might be the most well-positioned automaker doing business on American soil.

Case in point: China. In the first half of this year, GM reported U.S. unit sales of some 1.07 million vehicles. However, a relative few know that GM sold about 1.2 million units in China over the same period. In truth, the Chinese – resting atop an economy only recently asserting itself as a mega-power – seem to love GM products.

GM sales growth in the populous nation is projected to continue on an upward path well into this decade.

So, if you consider automobile sales amid a world market – and most of the folks who produce vehicles these days think precisely that way – General Motors has a serious foothold compared with Ford, Chrysler and others.

How did this happen? In the years before the recession, GM did the heavy lifting in China, meeting with government officials and business leaders, and generally absorbing the culture from top to bottom. It was forming relationships with key Chinese manufacturing operations, all the while living within the rules the Chinese established for doing business in their country.

Ironically, one of the chief architects of GM’s plan was former chairman and CEO Rick Wagoner, essentially forced out of those posts by the White House in March 2009. Wouldn’t it be ironic if GM’s re-emergence as a global superpower is ultimately credited to Wagoner, who couldn’t muster respect from high places in Washington?

Yes, it could happen. And probably will.

On top of that, GM is making strides with its increasingly attractive vehicle lineup, and it stands to overcome those government bailout blues if its plug-in Chevrolet Volt becomes a hit in the United States.

Think GM is dead? Not on your life.

1 comment:

  1. I was not aware that GM is also targeting China and the sales is almost the same in the US. I can say that it's like a silent business.