DETROIT â Itâs fair to say Rick Wagoner had a better 2007 North American International Auto Show than in 2006.
Taking home both the North American car and truck of the year awards (Saturn Aura and Chevrolet Silverado) would do that for any top auto executive, but particularly for theCorp.âs chairman and CEO, who among other formidable challenges in 2006 faced drastic company restructuring.
Winning the car and truck awards sends a message that while there were âbombs across the air last year, every way, shape and form they could have come, the vast majority of the people at GM were doing exactly what they should,â Wagoner says at a roundtable discussion with a group of reporters at the North American International Auto Show.
Wagoner says GMâs delay of filing its first-quarter financials due to accounting irregularities marked last yearâs lowest point. âIt came up completely out of the clear blue. Those were trying times, to say the least.â
GM in 2005 lost $10.6 billion but is set for profitability this year thanks to massive cost cutting over the last 12 months, Wagoner says.
Nevertheless, the CEO sees a very âlong runwayâ for GMâs turnaround and is reluctant to place a date for when its completion.
Some people ask when the business will be profitable again, Wagoner says.
âOur objectives have to be much, much bigger than that. Itâs not an issue (of) can you make a nickel. That doesnât do anything for anybody. We need to get good profit, and very importantly we need to generate good cash flow.â
Growing revenue and the perennial struggle with escalating employee health-care costs, which still hover at about $1,200 to $1,500 per unit, will continue to dominate GMâs agenda in 2007, he says.
âWeâve made a nice step in addressing health care, but we havenât fixed it by any stretch,â Wagoner says.
Just as important, he says was GMâs overhaul of its sales and marketing strategy, which lowered prices while slashing sales incentives.
âWhat we did last year (A) was the right thing and (B) cost us revenue,â he says. âOver time, we expect itâs going to yield us more revenue. I hope we donât get too old waiting for that to happen.â