General Motors Company · NYSE:GM
General Motors — Conference Presentation (January 2011)
26 slides from General Motors's conference presentation, Jan 12, 2011
Slide 1: Chris Liddell, Vice Chairman and CFO
CHRIS LIDDELL Exhibit 99.1 Vice Chairman and CFO
Slide 2: Forward Looking Statements
In this presentation and in related comments by our management, our use of the words “expect,” “anticipate,” “possible,” “potential,” “target,” “believe,” “commit,” “intend,” “continue,” “may,” “would,” “could,” “should,” “project,” “projected,” “positioned” or similar expressions is intended to ide
Slide 3: Financial Philosophy
FINANCIAL PHILOSOPHY B e Mode
Slide 4: Industry Structure
Cyclical + High operating leverage + Capital / engineering intensive + Highly leveraged / interdependent value chain INDUSTRY STRUCTURE INDUSTRY STRUCTURE
Slide 5: U.S. Total Auto Sales Peak-Trough Swings
U.S. TOTAL AUTO SALES PEAK — TROUGH SWINGS Previous Breakeven (soy) s#un Current Breakeven q 60-0002 00-T66T 16-986T 98-786T 78-861 8L-SL6T SL-EL6T €L-0L6T 0L-696T 89-8S6T 8S-SS6T $S-7S6T 75-0S6T 0S-€6T ev-LE6t LE-TEGT ZE-676T 62-€T6T
Slide 6: High Operating Leverage: Global OEM EBIT Margins
HIGH OPERATING LEVERAGE Global OEM EBIT Margins Note: Global OEMs include GM, Ford, BMW, Daimler, Fiat, Honda, Hyundai, Nissan, Peugeot, Renault, Toyota, VW. HIGH OPERATING LEVERAGE Global OEM EBIT Margins
Slide 7: at le
at le
Slide 8: Highly Leveraged Interdependent Value Chain
HIGHLY LEVERAGED INTERDEPENDENT VALUE CHAIN % Financed son» on SS + [en ~50% ~ 100% ~80%
Slide 9: New Business Model
DESIGN, BUILD and SELL THE WORLD’S BEST VEHICLES NEW BUSINESS MODEL DESIGN DESIGN BUILD BUILD SELL SELL SELL DESIGN World's Best Vehicles Fewer Brands, Global Architectures Higher Capacity Utilization Reduced Inventories Lower Incentives / Higher Prices Improved Brand Equity Higher Residuals Higher
Slide 10: Financial Strategy
Strong investment grade credit rating + Minimal debt + Fully funded, de-risked pension plan FINANCIAL STRATEGY FINANCIAL STRATEGY
Slide 11: Questions
How realistic? WACC? Temporary strategy? QUESTIONS ¶ ¶ ¶ QUESTIONS
Slide 12: Progress
PROGRESS 9/10 adjusted for completed Q4 capital actions, planned equity contribution to pension plan and funding AmeriCredit acquisition. Perpetual preferred is at face value. Cash includes marketable securities and Canadian HC Trust restricted cash. PROGRESS
Slide 13: Slide 13
Slide 14: WACC
WACC Tax Shield WACC Debt Ratio Debt Tax Shield WACC GM tax losses = ~$40B WACC Financial Theory:
Slide 15: Back to the Future
BACK TO THE FUTURE * Adjusted debt as of 9/30/2010. Not rated but minimal debt BACK TO THE FUTURE Not rated but minimal debt
Slide 16: Slide 16
Slide 17: Q4 Outlook
Expect Q4 EBIT to remain positive, but at a significantly lower run-rate than each of first three quarters – Different production mix – New vehicle launch costs – Increased engineering expense in support of future products $0.7B non-cash charge associated with purchase of Series A Preferred Stock he
Slide 18: Mark Reuss, President, GM North America
MARK REUSS President, GM North America
Slide 19: GM U.S. Market Share
GM U.S. MARKET SHARE GM U.S. market share based on Buick, Cadillac, Chevrolet & GMC only GM U.S. MARKET SHARE
Slide 20: It's All About Cars, Trucks and Crossovers
Product launches – Full year of Cruze, Regal, CTS Coupe, Heavy Duty Pickups – Regal begins production in Oshawa – Increase in Terrain/Equinox production – Volt, Verano, Sonic, Camaro Convertible Flexible manufacturing – Build to market demands Focus on quality IT’S ALL ABOUT CARS, TRUCKS AND CROSSOV
Slide 21: 2011 CY GM Product Launches
2011 CY GM PRODUCT LAUNCHES UNITED STATES CANADA Chevrolet Camaro Convertible Buick Regal GS Chevrolet Orlando Chevrolet Volt Chevrolet Sonic 4dr Buick Verano MEXICO CENTRAL AMERICA/CARIBBEAN Chevrolet Camaro Convertible Chevrolet Sonic 5dr Chevrolet Camaro Convertible Buick Regal GS Chevrolet Sonic
Slide 22: Discipline on Price
Maintain ATP (Average Transaction Price) strength Hold % incentive spend vs. competition Value story GM Financial – U.S./Canada Lease penetration – Grow U.S. Sub-Prime APR penetration DISCIPLINE ON PRICE ¶ ¶ ¶ ¶ DISCIPLINE ON PRICE
Slide 23: U.S. Lease Percent of Retail Sales
U.S. LEASE PERCENT OF RETAIL SALES Source: J.D. Power and Associates PIN U.S. LEASE PERCENT OF RETAIL SALES
Slide 24: Dealer Network and Customer Experience
Dealer network a strength Facility image program – 981 Dealers have initiated improvements – 2,000 more will begin in 2011 Robust programs in place – Drive Dealership throughput – Encourage parts purchase loyalty – Support customer retention DEALER NETWORK AND CUSTOMER EXPERIENCE ¶ ¶ ¶ DEALER NETWOR
Slide 25: Marketing and Improving Consideration
Brand building initiatives – Chevrolet Carbon Reduction – Volt – Main Street in Motion – Consistent messaging through Tier 3 – Partnership with MTV targeting millennial generation Focus on customer retention – Discontinued brands – Service/Parts MARKETING AND IMPROVING CONSIDERATION ¶ ¶ MARKETING AN
Slide 26: Reinvigorating Our Culture
Made large scale changes to organizational structure in 2010 On-going adjustments will be made as necessary Getting our Soul back REINVIGORATING OUR CULTURE ¶ ¶ ¶ REINVIGORATING OUR CULTURE
General Motors — Conference Presentation (January 2011) on 6ix