General Motors News

[kscarbel2]

GM to phase out Holden, pull Chevy from Thailand

Reuters/Bloomberg  /  February 16, 2020

General Motors is retreating from more markets outside of the United States and China, saying on Sunday that it will wind down sales, design and engineering operations in Australia and New Zealand and retire the Holden brand by 2021.

GM also said that China's Great Wall Motor Co. had agreed to buy its Thailand manufacturing plant. The automaker said it also plans to pull the Chevrolet brand from Thailand.

The company expects to incur net cash charges of about $300 million in connection with the changes, and total cash and non-cash charges of $1.1 billion.

In rearranging its global operations, GM is accelerating a retreat from unprofitable markets, notably Europe, while becoming more dependent on the United States, China, Latin America and South Korea.

GM Chief Financial Officer Dhivya Suryadevara told analysts during a Feb. 5 presentation that restructuring GM's international operations outside of China so they produce profit margins in the mid-single digits "does represent a $2 billion improvement" compared with 2018.

Ahead of that presentation, GM forecast flat profit for 2020 and reported a better-than-expected fourth-quarter earnings in the face of a $3.6 billion hit from a 40-day United Auto Workers strike.

With the proposed sale of the Thailand plant to Great Wall, GM is giving up an opening to expand operations in Southeast Asia.

GM is "focusing on markets where we have the right strategies to drive robust returns, and prioritizing global investments that will drive growth in the future of mobility," especially in electric and autonomous vehicles, GM Chairman and CEO Mary Barra said in a statement.

“I’ve often said that we will do the right thing, even when it’s hard, and this is one of those times,” Barra added.

She has prioritized profit margins over sales volume and a global footprint since taking over in 2014.

In 2017, GM sold its Opel and Vauxhall business units in Europe to Peugeot SA and exited South Africa and other African markets.

Since then, Barra has decided to pull GM out of Vietnam, Indonesia and India.

In earlier moves, GM withdrew the Chevrolet brand from Europe in 2015 and left Russia the same year.

Like Britain, Australia and New Zealand are right-hand drive markets. With sales of GM's Australian Holden brand plummeting, the company could not justify the investment to continue building right-hand drive vehicles, GM President Mark Reuss said in Sunday's statement.

Reuss ran Holden in 2008 and 2009, but since then GM's market share has fallen from almost 13 percent to 4.1 percent, the company said in a statement.

GM ended Holden manufacturing in 2017. GM imports the majority of the Holden models it sells in Australia, mostly from South Korea and Thailand.

Even when GM stopped manufacturing Holden models -- adorned with a "lion and stone wheel" logo -- in Australia, GM and brand officials maintained it was "going to be a part of the fabric" of the "country for a very long time."

Yet the cost of maintaining a separate brand in such a small and fractured market, increasingly dominated by Asia automakers, proved too daunting, even for an automaker with GM's global scale.

GM has 828 employees in Australia and New Zealand and another 1,500 in Thailand, the company said.

Great Wall, one of China's biggest SUV makers, said it will sell vehicles from the Thai manufacturing plant in Thailand, other ASEAN countries and Australia as the Baoding-based automaker seeks to expand globally amid a slowing domestic market.

In January, Great Wall signed an agreement to buy a GM plant in India. The companies said they expect the transaction would be completed by the second half of 2020.

[TS7]

Does Mary Barra know how to make operations profitable? Or does she only know how to shut down and sell off operations. Big market coming for electric, self driving Hummers in her ideal world.  

[RoadwayR]

Needed to happen, sorry to say.  Staying in that kind of market which required heavy investment while earning little or no profit is just the kind of mistake the old GM had made time and time again.  

[kscarbel2]

3 hours ago, RoadwayR said:

Needed to happen, sorry to say.  Staying in that kind of market which required heavy investment while earning little or no profit is just the kind of mistake the old GM had made time and time again.  

GM failed only because it never had the right leadership for Asia except in one instance.........Philip Murtaugh. And they stupidly ran him out in the end, the only GM guy who ever understood the China market.

[kscarbel2]

GM suppliers preparing to manufacture ventilator parts

Dustin Walsh, Automotive News  /  March 22, 2020

Parts suppliers for General Motors are preparing to manufacture parts for at least 200,000 ventilators in an effort to stave off a projected shortage of the machines in the fight against the deadly respiratory illness COVID-19.

Meridian Lightweight Technologies Holdings Inc. of Southfield, Michigan, is helping GM procure six different compressor parts made of magnesium for an estimated 200,000 ventilators, said Joe Petrillo, director of North American sales.

The parts are too small for Meridian's machines, but the company has connected GM with Twin City Die Castings Inc. in Minneapolis and Myotek, which operates manufacturing plants in Manistee, Michigan, and China.

"We coalesced as an industry," Petrillo said. "Usually we [Meridian, Twin City and Myotek] compete, but in this circumstance, we're not competitors."

The Society of Critical Care Medicine projects that 960,000 coronavirus patients may become critically ill in the U.S. and need to be put on ventilators. The organization estimates there are only about 200,000 ventilators in the country.

Michigan Gov. Gretchen Whitmer said Friday the State Emergency Operations Center is working to find creative ways to bring more ventilators to Michigan. It's estimated the state has only 1,000 right now.

"We are working to see how we can increase the number of ventilators in our state," Whitmer said. "I feel like we are making some progress, but if the federal government is able to procure some ventilators and ship them to Michigan we will be incredibly grateful."

President Trump tweeted Sunday: "Ford, General Motors and Tesla are being given the go ahead to make ventilators and other metal products, FAST! Go for it auto execs, lets see how good you are?"

Petrillo said the plans to start production as early as Monday were being sent Sunday afternoon.

"We're off and running. The tool shops are designing tools right now," said Eric Showalter, CEO of Mytek. "We're able to at least start to kick off tools in China to build these things. If we get paid, we get paid. We're all just trying to help where we can."

GM announced last Friday it partnered with Bothell, Wash.-based Ventec Life Systems to increase production of its ventilators. Ventec will leverage GM's logistics, purchasing and manufacturing prowess.

It's unclear whether GM is establishing another assembly line at Ventec's production plant or will manufacture the additional ventilators at one of its plants.

GM said it has "teams hard at work," Jim Cain, senior manager of sales and executive communications.

Canadian supplier Magna International Inc. has also been contacted to manufacture ventilator parts and is "currently investigating possibilities," confirmed Tracy Fuerst, vice president of corporate communications.

So has powertrain parts supplier BorgWarner Inc.

"We have been approached and are currently evaluating if we can support the effort out of our facilities," said Michelle Collins, manager of marketing.

[TS7]

I have no idea how to make a ventilator. But you can thank GM, Ford and the rest of the US auto-truck makers for helping to almost kill the US tool and die business by sending that work to Red China. Lot more to this story. I know more than a few small tool and die shop owners who hate GM over sourcing parts in Red China. 

[Rob]

4 hours ago, TS7 said:

I have no idea how to make a ventilator. But you can thank GM, Ford and the rest of the US auto-truck makers for helping to almost kill the US tool and die business by sending that work to Red China. Lot more to this story. I know more than a few small tool and die shop owners who hate GM over sourcing parts in Red China. 

Think about Caterpillar in those same sentiments. Whole blocks of factories and shops have been knocked down and jobs gone, sent to China.

And that is just Peoria, and E. Peoria, IL.

[TS7]

Rob I agree with you. Cat is right there with the rest on this issue. 

[kscarbel2]

MarketWatch  /  March 24, 2020

General Motors said Tuesday it is planning to draw down about $16 billion from its revolving credit facilities, as it works to boost cash during the coronavirus pandemic.

The company said the funds will supplement the company's cash position of about $15 billion to $16 billion expected at the end of March.

"We are aggressively pursuing austerity measures to preserve cash and are taking necessary steps in this changing and uncertain environment to manage our liquidity, ensure the ongoing viability of our operations and protect our customers and stakeholders," CEO Mary Barra said. "Over the past several years, we have made necessary, strategic decisions and structural changes that have transformed the company and strengthened the business, better positioning us for downturns."

GM Financial had $24 billion of liquidity at the end of 2019 and expects to end the first quarter with similar levels, said the statement. That should be sufficient to support at least six months of cash needs, including new originations, without access to capital markets.

GM said it is withdrawing its guidance for 2020.

[kscarbel2]

Reuters  /  March 24, 2020

DETROIT — General Motors and medical equipment maker Ventec are speeding up efforts under a partnership code-named "Project V" to build ventilators at a GM plant in Kokomo, Indiana, to help combat the coronavirus outbreak.

GM said on Monday that work at its Indiana plant, which makes small electronic components for cars, is part of the effort to expand ventilator production. The GM-Ventec project is known internally as "Project V."

As part of the effort to boost ventilator output from Ventec, of Bothell, Washington, GM has arranged for the supply of 95% of the parts needed to build the ventilator and is seeking to source the remaining 37 necessary parts.

The goal of the venture is to build up to 200,000 ventilators.

"Ventec Life Systems and General Motors have been working around the clock to implement plans to build more critical care ventilators," GM spokesman Dan Flores said on Monday. "With GM’s support, Ventec is now planning exponentially higher ventilator production as fast as possible.

"As part of those efforts, GM is exploring the feasibility to build ventilators for Ventec at a GM facility in Kokomo, Indiana," he added. 

First parts need to be delivered by suppliers to GM by April 6. Supplier production could begin within the next 2-3 weeks.

Creative Foam Corp in Fenton, Michigan, is one of the auto suppliers joining the effort. It already had a division serving the healthcare sector.

Creative Foam will start making foam parts for the ventilators' air filtration system this week, CEO Phil Fioravante said. "We already have installed capacity, so we're just repurposing it and utilizing it for this end."

In Minneapolis, auto supplier Twin City Die Castings Co, which had signed a contract to supply Ventec about nine months ago, quickly amped up its plans, CEO Todd Olson said. It makes aluminum and magnesium parts for the ventilator compressor and housing.

Now Twin City is converting the parts it was making into die casts for higher-volume production as the volume target has gone from making parts for 150 ventilators a month to as many as 20,000.

Such a conversion would normally have taken 12 weeks to complete, Olson said, but is being done in one week as employees work almost nonstop. In addition, Twin City and rivals are sharing intellectual property to speed the process. "Luckily, we had a nice jump on this," Olson said.

[kscarbel2]

GM cuts white-collar salaries 20%, furloughs 6,500 in U.S.

Hannah Lutz, Automotive News  /  March 26, 2020

DETROIT — General Motors is freezing work on some vehicle programs and will temporarily reduce paychecks for all salaried employees globally by 20 percent to conserve cash as it weathers the coronavirus outbreak. But the automaker is promising to make up for the lost income within a year.

In addition, 6,500 salaried workers in the U.S. — mostly people in engineering and manufacturing functions who cannot work remotely — will be placed on leave and receive 75 percent of regular pay during the downtime.

General Motors CEO Mary Barra and CFO Dhivya Suryadevara told employees on Thursday the company needed to take immediate aggressive steps to cut costs.

Suryadevara warned "if we don’t take significant austerity measures we will do serious damage to the long-term viability of our company."

Suryadevara noted that GM has very little revenue coming in “and we are preparing to operate the company temporarily on credit if necessary."

In an email to employees on Thursday, Barra said GM for years has been making "difficult decisions to strengthen our business and make it more resilient," and now those moves "will be put to the test," Reuters reported.

Barra told employees the largest U.S. automaker is "aggressively taking costs out of the business wherever we can by suspending work on some product programs and cutting our marketing budgets and hundreds more actions."

While some vehicles under development will be delayed, models close to launch such as the redesigned Chevrolet Tahoe, GMC Yukon and Cadillac Escalade large SUVs will go on sale later this year as scheduled. The company is also sparing a Cadillac electric SUV and Cruise Origin self-driving vehicle from delays.

"GM's business and its balance sheet was very strong before the COVID-19 outbreak and the steps we are taking now will help ensure that we can regain our momentum as quickly as possible after this crisis is over," the company said Thursday.

The pay deferments will start April 1 and potentially could last about six months, GM spokesman Jim Cain said.

Employees will receive lost earnings in a lump-sum payment no later than March 15, 2021, GM said.

The move will result in "significant" immediate cash savings, but GM declined to be more specific. The company has about 69,000 salaried employees, or about 42 percent of its global work force.

Executives will see deeper pay cuts on top of the unilateral 20 percent deferment, resulting in a total reduction during the crisis of 30 percent for senior leadership and 25 percent for other executives. Pay for members of GM's board of directors will be cut 20 percent and not repaid.

Employees' health care benefits will not be affected.

[kscarbel2]

President Trump today criticized General Motors in a series of tweets, about the automaker not providing the number of ventilators that were expected.

"As usual with 'this' General Motors, things just never seem to work out," Trump said. "General Motors MUST immediately open their stupidly abandoned Lordstown plant in Ohio, or some other plant, and START MAKING VENTILATORS, NOW!!!!!!"

Trump stated that GM said it will only provide 6,000 ventilators in late April, and they want "top dollar," after saying they would provide 40,000 ventilators "'very quickly.'

Trump added, "Always a mess with Mary B. Invoke'P,'", in reference to GM CEO Mary Barra and with P referring to the Defense Production Act.

[Red Horse]

3 hours ago, kscarbel2 said:

President Trump today criticized General Motors in a series of tweets, about the automaker not providing the number of ventilators that were expected.

"As usual with 'this' General Motors, things just never seem to work out," Trump said. "General Motors MUST immediately open their stupidly abandoned Lordstown plant in Ohio, or some other plant, and START MAKING VENTILATORS, NOW!!!!!!"

Trump stated that GM said it will only provide 6,000 ventilators in late April, and they want "top dollar," after saying they would provide 40,000 ventilators "'very quickly.'

Trump added, "Always a mess with Mary B. Invoke'P,'", in reference to GM CEO Mary Barra and with P referring to the Defense Production Act.

Yes sir boss!  Must be a whole lot of commonality in building cars on an assembly line vs. building ventilators- I guess I just never realized that.😎

[kscarbel2]

2 hours ago, Red Horse said:

Yes sir boss!  Must be a whole lot of commonality in building cars on an assembly line vs. building ventilators- I guess I just never realized that.😎

Bob, once shown the design goal, auto designers can create almost anything. Ford designed and began production in an impressive time frame.

If a vacuum cleaner guy can do it in 10 days, General Motors certainly should be able to...................https://us.cnn.com/2020/03/26/tech/dyson-ventilators-coronavirus/index.html

[TS7]

Kscarbel you are 100% right. I live about 14 miles north of the GM Tech Center. If in that vast place there is not some group that could not get something going in a few days, give me a break. The US taxpayer bailed out these people and Mary got her job because of it.They do not have too re-tool a auto plant to do this. 

[TS7]

By the way out of 6500 people GM put on furlough this week how many would it have taken to get something going? 10-50, but Mary was looking to cut costs on payroll.  I was working on servicing a Cat Loader of mine stuck on a shut down private dirt job today and a GM engineer (working from home, but  really riding his bike around doing nothing) was going to call the police on us because we were working and not at home on lock down.

[kscarbel2]

GM ordered to produce ventilators under Defense Production Act

Automotive News  /  March 27, 2020

President Trump, accusing the company of "wasting time" while the federal government faces mounting pressure to marshal more resources to stem the deadly coronavirus outbreak, invoked emergency powers and ordered General Motors on Friday to produce ventilators under the Defense Production Act.

In a memorandum released by the White House, Trump said Health and Human Services Secretary Alex Azar would determine the number of ventilators GM must build.

The act grants the president power to expand industrial production of any key materials or products for national security and other reasons.

In the case of GM, the order means the company must "accept, perform, and prioritize federal contracts for ventilators.”

Also late Friday, Trump appointed White House trade adviser Peter Navarro to coordinate actions under the act, and issued an executive order authorizing the government to “guarantee loans by private institutions, make loans, make provision for purchases and commitments to purchase, and take additional actions to create, maintain, protect, expand, and restore domestic industrial base capabilities to produce such resources.”

Rising death toll

Trump, at a White House briefing late Friday, said the United States would produce 100,000 ventilators in 100 days and said he had named White House aide Peter Navarro as the coordinator of the Defense Production Act.

"We're going to make a lot of ventilators," Trump said, pledging to take care of U.S. needs while also helping other countries.

Trump said there was a great chance the United States would not need so many ventilators to fight the coronavirus outbreak, and would then help other countries in need.

On Friday, the number of confirmed coronavirus cases in the United States topped 100,000, the highest in the world. The U.S. death toll now tops 1,550.

GM said earlier Friday it will begin shipping FDA-cleared ventilators as soon as next month from an Indiana plant after Trump earlier Friday urged the company, as well as Ford, to ramp up output of the devices to treat COVID-19 patients.

GM, in partnership with medical device company Ventec Life Systems, is building critical care ventilators at a Kokomo, Indiana, factory under a program dubbed Project V. Ventec also will increase production at a manufacturing site in Bothell, Washington.

Scope unclear

It's unclear whether Friday's order will require GM to tap other U.S. plants to build ventilators, but the automaker now faces direct government pressure under law to accelerate output.

“Our negotiations with GM regarding its ability to supply ventilators have been productive, but our fight against the virus is too urgent to allow the give-and-take of the contracting process to continue to run its normal course," Trump said.

“GM was wasting time,” Trump added. “Today’s action will help ensure the quick production of ventilators that will save American lives.

GM said Friday it has been working with Ventec and other partners "around the clock for over a week to meet this urgent need."

The automaker, which is undertaking the project as a contract manufacturer for Ventec, is donating resources at cost, according to a Friday statement.

Ventec and GM said they are able to build more than 10,000 ventilators a month, depending on the needs of the U.S. government.

Since the GM-Ventec partnership was announced March 20, the companies' supply base has sourced more than 700 individual parts that are needed to build up to 200,000 ventilators. 

Working with the UAW, GM said it will recall about 1,000 workers to immediately scale up ventilator output.

GM also will begin producing surgical masks at a manufacturing facility in Warren, Michigan, starting next week. Within two weeks, GM expects to ramp up production to 50,000 masks per day. That total could potentially increase to 100,000 per day.

The UAW, which has pressed the Detroit 3 to idle U.S. plants to safeguard employee health and safety, applauded GM's efforts.

The price tag for GM's bid to supply ventilators was more than $1 billion, the paper said, with several hundred million dollars to be paid upfront to the automaker.

Ford Motor Co. said it’s also “pulling out all the stops” to build ventilators and other devices needed to deal with the pandemic.

Ford is already delivering tens of thousands of face shields to hospitals and police, Mark Truby, the automaker’s vice president of communications, said Friday.

Truby also said Ford is “working flat-out” with General Electric Co. to produce ventilators and 3M Co. to boost production of air-purifying respirators in a partnership announced three days ago.

Industry efforts

Other automakers are also working to produce ventilators, masks and other medical equipment.

On Friday, Toyota Motor Corp. said it was "finalizing agreements to begin working with at least two companies that produce ventilators and respirators to help increase their capacity."

New York City Mayor Bill be Blasio on Friday said on Twitter that Tesla Inc. had agreed to donate hundreds of ventilators to hospital intensive care units in New York City and the state of New York.

Tesla CEO Elon Musk in response said the electric carmaker was helping locate and deliver existing ventilators.

Tesla on Friday did not respond to a request for comment on where it got the ventilators from and whether the company was producing any ventilators of its own, something Musk has said the company will do.

Fiat Chrysler Automobiles and Ferrari previously said they were exploring making ventilators in Italy.

[Red Horse]

3 hours ago, kscarbel2 said:

Bob, once shown the design goal, auto designers can create almost anything. Ford designed and began production in an impressive time frame.

If a vacuum cleaner guy can do it in 10 days, General Motors certainly should be able to...................https://us.cnn.com/2020/03/26/tech/dyson-ventilators-coronavirus/index.html

Well my point was his rant about converting a huge assembly plant, that they sold by the way , to begin producing "bench  top" products.  Have you seen all the shots of existing ventilator assembly lines?  Like I said, bench top products.

[RoadwayR]

From what I understand, the price tag came from Ventec, not GM.  And the problems began when Ventec and GM couldn't get a contract from the Feds so for them it was impossible to hire and tool up not knowing how many ventilators would be purchased (even Trump has questioned how many will be needed), or come up with an accurate cost.  Nonetheless, GM figured in any event they would not have enough employees at Kokomo and had begun to hire more to produce the ventilators.  Ventec and GM are continuing on ventilator production without a firm contract.  GM has also begun production of surgical masks and other supplies at its Warren facility.  It will be interesting to see how many ventilators both GM and Ford are able to produce and how soon they will be available.  Even if they are not going to be available in large numbers until after the crises has past at least they could be stockpiled in the event a similar pandemic happens again.

And while all this has been going on, Elon Musk and Tesla were able to buy large numbers of ventilators from China..............

  

[TS7]

I would like to know what GM was doing on 12-8-1941? I have a feeling that back then that they were asking what was needed and how many.  Not waiting for a cost plus contract and will get back to you. Maybe Kscarbel can post about how fast Chrysler got the Warren Tank Plant built and running back then.  

[kscarbel2]

11 hours ago, Red Horse said:

Well my point was his rant about converting a huge assembly plant, that they sold by the way , to begin producing "bench  top" products.  Have you seen all the shots of existing ventilator assembly lines?  Like I said, bench top products.

You're right Bob. I believe Ford is producing at a non=standard site, i.e. not at one of the auto final assembly plants.

[kscarbel2]

12 hours ago, Red Horse said:

Well my point was his rant about converting a huge assembly plant, that they sold by the way , to begin producing "bench  top" products.  Have you seen all the shots of existing ventilator assembly lines?  Like I said, bench top products.

Bloomberg  /  March 28, 2020

Sixteen months after Mary Barra angered Donald Trump by announcing plans to close several U.S. factories in states the president vowed to revive, the General Motors Co. CEO is back on the outs with the White House.

Unlike in late 2018, Trump’s Friday fracas over ventilators caught GM completely off guard. Trump first accused GM of taking too long to make the desperately needed medical devices and of trying to gouge the government. By the evening, the President again criticized the automaker for closing a car factory in Ohio.

Executives at GM -- which had worked around the clock for a week to convert an Indiana parts plant into a breathing-machine factory -- were themselves frustrated over how long it was taking the federal government to finalize terms with its partner Ventec Life Systems Inc.

GM forged ahead and detailed the ventilator deal in a midday statement that disputed President Trump by saying it would be “contributing its resources at cost.”

Trump followed up with an order that GM accept a federal contract that the company and Ventec had been seeking all along.

Patching things up with the White House will be crucial for a company that is struggling to cope with idled plants amid the coronavirus pandemic. GM is freezing work on new-vehicle programs, deferring pay for white-collar staff and piling up cash to weather a global health crisis and the economic fallout expected to follow for months to come.

“The entire GM team is proud to support this initiative,” GM said. “Our commitment to build Ventec’s high-quality critical care ventilator, VOCSN, has never wavered.”

[RoadwayR]

4 hours ago, kscarbel2 said:

You're right Bob. I believe Ford is producing at a non=standard site, i.e. not at one of the auto final assembly plants.

Probably the right way to do something like this.

[RoadwayR]

7 hours ago, TS7 said:

I would like to know what GM was doing on 12-8-1941? I have a feeling that back then that they were asking what was needed and how many.  Not waiting for a cost plus contract and will get back to you. Maybe Kscarbel can post about how fast Chrysler got the Warren Tank Plant built and running back then.  

Remember that Roosevelt got U.S. manufacturing on a war footing over a year before Pearl Harbor, so negotiating and plant set up happened well before the shooting started for us.  Ford did eventually quite a job building B-24 bombers, but read up on how long that project took before the first plane was produced.  And how much pacifist  Henry Ford drug his feet to hinder it.  And how bad the early Ford produced B-24's were.  If it wasn't for Edsel Ford and a lot of Federal pressure it probably would have never happened.    

[kscarbel2]

17 minutes ago, RoadwayR said:

Remember that Roosevelt got U.S. manufacturing on a war footing over a year before Pearl Harbor, so negotiating and plant set up happened well before the shooting started for us.  Ford did eventually quite a job building B-24 bombers, but read up on how long that project took before the first plane was produced.  And how much pacifist  Henry Ford drug his feet to hinder it.  And how bad the early Ford produced B-24's were.  If it wasn't for Edsel Ford and a lot of Federal pressure it probably would have never happened.    

The B-24 Liberator may have had a larger bomb load than the B-17, but I never trusted it. Particularly the early ones, they were a death trap.

The Consolidated Liberator was designed by bean counters to be expendable, while the Boeing B-17 alike the B-29 was designed to complete the mission and return to base.

Many Americans died needlessly in the 1941-1943 period because we entered the war with shockingly inferior weaponry. Granted, we'd just been in extended depression.