GM CEO: Lincoln is Over
06-06-11, 12:45 PM
#1
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GM CEO: Lincoln is Over
"They are trying like hell to resurrect Lincoln. Well, I might as well tell you, you might as well sprinkle holy water. It's over."
So says General Motors CEO Dan Akerson, speaking to reporters from The Detroit News. Fightin' words to be sure, though it seems the suits at Lincoln, Ford's luxury brand that competes with Cadillac here in the United States, have declined to comment on Akerson's statement.
The dismissal of the Lincoln brand seems especially interesting given Akerson's reported take on the current state of Cadillac. Akerson is said to believe that Cadillac isn't yet where it needs to be, saying the brand needs another 12 to 24 months of gestation. By that time, there ought to be bookends to the current CTS in place in the form of the ATS (smaller) and XTS (larger, replacing the STS and DTS).
Still, Akerson doesn't expect to "blow the doors off" Cadillac's competition, saying instead that "they will be very competitive." We'd think Caddy would be aiming squarely at something more like "class leading," but what do we know?
The GM CEO also weighed in on alternative powertrains, suggesting that the plug-in extended-range electric Chevrolet Volt will be "old, old technology and old news" 5 years from now. "In the next 10 years," he said, "this company has to break the code on advanced propulsion and that's going to be a multifaceted solution."
That multifaceted solution will apparently include dual-fuel engines that run on either compressed natural gas or gasoline along with various hybrids and electric drivetrains. What we won't see, though, are a ton of vehicles running on ethanol or hydrogen. Interesting sentiments (though we don't necessarily disagree), considering that GM currently has scads of machinery that's E85-capable and has made it through its 4th generation of hydrogen fuel cell technology.
Last edited by GS69; 06-06-11 at 12:49 PM.
06-06-11, 03:11 PM
#2
lol @ GM. With Ford down to two brands, and most of the focus on the Ford brand as of late, believe me Lincoln is coming. In fact 2013 will start the Lincoln revamp with the redesigned MKZ (Fusion to the lamen). A new line-up structure will help differentiate Ford and Lincoln vehicles. An arsenal of new tech and powertrains will also keep their models competitive. This is just GM being GM, bashing others to make themselves feel better.
Last edited by Hoovey689; 06-06-11 at 03:17 PM.
06-06-11, 05:08 PM
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Hahaha, from the company that can't make a decent interior for squat. A new MKZ is coming, which I think will be very good for Ford. The MKZ hybrid is doing well, selling 569 units in May (compared to Caddy's only hybrid, the Escalade, 89 units in May). Sure, Lincoln may not have a V lineup, but they certainly have a nice balance of luxury, power, and efficieny going right now.
06-06-11, 05:50 PM
#4
He said the volt technology will be very old in 5 years...... what?
Last I checked nobody has even seen a Volt on the streets yet. That would be like someone in 2007 saying that by the end of 2011 traditional Hybrid cars will be a thing of the past.
Here's some advice to GM.... first prove to us that this hyped up Volt is all it was said to be before making claims of making something far better. I smell major bull****.
Last I checked nobody has even seen a Volt on the streets yet. That would be like someone in 2007 saying that by the end of 2011 traditional Hybrid cars will be a thing of the past.
Here's some advice to GM.... first prove to us that this hyped up Volt is all it was said to be before making claims of making something far better. I smell major bull****.
06-06-11, 10:21 PM
#6
Recovering Lexus Addict
In today's segment, he advocates a boost in the gas tax:
"You know what I'd rather have them do — this will make my Republican friends puke — as gas is going to go down here now, we ought to just slap a 50-cent or a dollar tax on a gallon of gas," Akerson said.
"People will start buying more Cruzes and they will start buying less Suburbans."
From The Detroit News: http://detnews.com/article/20110607/...#ixzz1OZ3TRO34
Both Ford and GM execs have, in the past, called for higher gas taxes to convince consumers to purchase more efficient vehicles.
"You know what I'd rather have them do — this will make my Republican friends puke — as gas is going to go down here now, we ought to just slap a 50-cent or a dollar tax on a gallon of gas," Akerson said.
"People will start buying more Cruzes and they will start buying less Suburbans."
From The Detroit News: http://detnews.com/article/20110607/...#ixzz1OZ3TRO34
Both Ford and GM execs have, in the past, called for higher gas taxes to convince consumers to purchase more efficient vehicles.
06-06-11, 11:25 PM
#8
Lexus Test Driver
I think GM is full of crap (bragging, empty promises, delays, still some dated designs) and Ford has their own set of problems, such as the rediculous Lincoln grilles and retro dashboards. When they both improve in these areas, they'll have my undivided attention.
06-07-11, 04:51 AM
#11
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Profits
At General Motors Co.'s 1st annual meeting since going public again, Dan Akerson can talk up market-share gains and profit that old GM hadn't seen in a decade.
What he can't do is take a victory lap.
GM is trading 13% below its $33 price when CEO Akerson led the initial public offering in November. He has yet to show investors that GM has the operating efficiency or future product plan to match the profits of Ford Motor Co., which made 36% more money in the 1st quarter, excluding 1-time items.
Excitement around the IPO led the automaker and the U.S. Treasury, its biggest investor, to expand the sale to $15.8 billion in common equity plus preferred stock.
Since then, GM has tumbled and investors are waiting to see a plan to match Ford's profit or even buy out the government's stake, said Peter Nesvold, a Jefferies & Co. analyst.
"It's surprising," Nesvold said of the sinking stock price. "They kept the company together and brought it a long way, but investors haven't really bought into the story that it's a new GM."
GM executives have discussed buying shares from the Treasury, people familiar with the matter have said. GM may earn adjusted net income of $7.72 billion this year, the average of 10 analysts' estimates compiled by Bloomberg. Profit on an adjusted basis may rise to $9.55 billion in 2012, according to 10 estimates.
Meeting today
Akerson will discuss his priorities with shareholders at the annual meeting today, said Jim Cain, a company spokesman. He declined to comment on the stock's price. GM fell $0.56, or 1.9%, to $28.56 Monday in New York Stock Exchange composite trading.
GM may not be able to generate much investor interest until the economic recovery gains more traction or until the company puts up a few more quarters of solid numbers, said David Whiston, an analyst with Morningstar Inc. in Chicago.
In the 1st quarter, Ford made $2.55 billion while GM made $1.88 billion not including 1-time gains for asset sales. The government owns 33% of GM and would like to sell some of its stock this year, said 3 people familiar with the matter.
The government wants to sell for at least the $33 initial public offering price and needs a catalyst to get it there, the people said.
Mulally team
GM's shortcomings are highlighted in comparison to Ford, where CEO Alan Mulally kept his management team together and avoided bankruptcy. GM earns less in North America and Europe than Ford, which also has a large and profitable credit arm that is expected to deliver $2 billion in cash dividends to the parent company this year, Nesvold said.
While Ford's shares have slipped more since GM's IPO, its stock still trades at a higher valuation. GM's stock trades at 5.5 times its earnings while Ford trades at 6.9 times earnings, according to Bloomberg data.
Ford's market capitalization is $52.8 billion and GM's is $44.6 billion. Ford is making more money in North America, even though GM has higher sales volumes and a cost advantage. In the 1st quarter, Ford made $1.8 billion in pretax operating profit in its home continent, compared with $1.3 billion for GM.
One problem for GM is pricing. In the 1st quarter, GM led the industry in spending on discounts, which reduced profit by $300 million. Meanwhile, Ford raised prices on its cars, which added $700 million in pretax profit.
"That's a $1 billion difference," Whiston said. "I'll be watching to see if GM's pricing gets better in the 2nd quarter."
Price gap
After incentives, the Ford Fusion sells for $22,276, which is $1,342 more than the competing Chevrolet Malibu, and the Ford F-Series pickups sell for an average price of $30,898, which is $1,947 more than a Chevy Silverado, according to Edmunds.com, a consumer-research Web site.
In Europe, GM broke even in the 1st quarter, excluding a goodwill impairment charge, while Ford made $293 million in operating profit in the market.
Even in South America, where GM is the market leader, Ford made more money. Ford earned $210 million, more than double GM's $100 million in 1st-quarter pretax profit there. GM's 20% of the market more than doubles Ford's 9.4%, according to researcher IHS Automotive.
Finance company
GM's other disadvantage is in auto finance. Ford Credit earned $713 million in the 1st quarter compared with GM Financial's $130 million.
GM is rapidly expanding the operation and later this year will move into wholesale lending, which is extended credit to dealers so they can buy inventory, GM Financial CEO Dan Berce said in a June 1 interview.
The in-house lending unit would also consider starting an insurance unit to sell products to GM's car buyers, he said. The company may also make acquisitions to expand lending operations overseas, Berce said.
Improvements in the global economy that boost consumers' confidence and willingness to spend on durable goods may help GM improve its profit and stock price, said Kirk Ludtke, senior vice president of CRT Capital Group LLC in Stamford, Conn.
"GM's numbers have been underwhelming, but GM is a cheaper stock than Ford," he said. "If the economy comes back, the stock could really take off."
06-07-11, 06:04 AM
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He said the volt technology will be very old in 5 years...... what?
Last I checked nobody has even seen a Volt on the streets yet. That would be like someone in 2007 saying that by the end of 2011 traditional Hybrid cars will be a thing of the past.
Here's some advice to GM.... first prove to us that this hyped up Volt is all it was said to be before making claims of making something far better. I smell major bull****.
Last I checked nobody has even seen a Volt on the streets yet. That would be like someone in 2007 saying that by the end of 2011 traditional Hybrid cars will be a thing of the past.
Here's some advice to GM.... first prove to us that this hyped up Volt is all it was said to be before making claims of making something far better. I smell major bull****.
06-07-11, 08:39 AM
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"You know what I'd rather have them do — this will make my Republican friends puke — as gas is going to go down here now, we ought to just slap a 50-cent or a dollar tax on a gallon of gas," Akerson said.
"People will start buying more Cruzes and they will start buying less Suburbans."
"People will start buying more Cruzes and they will start buying less Suburbans."
1. You're always going to have people who can afford to burn as much fuel as they want to.
2. You're always going to have people who buy fuel thirsty vehicles that they can't afford to fill.
