GM stock shrugs off Akerman comments of streamlined dealer network enjoying higher throughput and profitability


In remarks prepared for delivery, Dan Akerson, Chairman and CEO of General Motors Company (NYSE: GM), delivered the keynote address at the National Automotive Dealers Association/IHS Automotive Forum in New York. Among his many statements, he noted GM’s higher throughput and profits from the streamlined dealer network, but GM stock still traded lower and closed at 29.59.

Hosted by the New York International Auto Show, the forum brought together leaders from OEMs, suppliers, dealers and media to discuss major industry events and focus on how the economic recovery will affect automotive stakeholders.

For a complete read of the transcript, visit http://media.gm.com/content/media/us/en/news.detail.brand_GM.html/content/Pages/news/us/en/2011/Apr/0419_akerson

Torque News, for the record, is working on a new experimental dealer interview project whereby Akerson’s words fit right in, and we will use in the future to test dealer response. Here are just some of Akerson’s statements that we feel will become a basis for future interviews to get the real fundamental picture for the stock using dealers.

Opening

It’s a great time to talk about transformation… and you have to admit, the transformation taking place in the auto industry right now… and nowhere more than at GM… is pretty exciting stuff. It’s a thrill to walk the floor of GM’s assembly plants… or any OEM assembly plant… and watch a miracle-a-minute roll off the line.

It’s a thrill to see the pride in the faces of the men and women who build these incredible machines. It’s a thrill to see the wonder and delight on customers’ faces when they walk through a show like this one. Even hard-boiled New Yorkers have been known to crack a smile. And it’s a thrill to visit a dealership, where it all comes together.

Akerson especially noted consumers

Consumers are coming off the sideline. with retail sales for the industry up 28 percent year to date. At GM, we continue to project U.S. industry sales this year of 13-13.5 million. That’s a great improvement if we can sustain it.

And the excitement is showing in other ways, too. The NADA’s latest “Dealer Attitude Survey” shows an overall improvement in GM dealer satisfaction of 35 points in the last 18 months.

We have improved across the board… and hit historical highs in virtually every category – from franchise value… to consideration of dealer input… to corporate helpfulness.
Wow. That may be the first time I’ve ever used the words “corporate” and “helpful” together.

Still, it’s our best performance in six years and we’re not going to stop there. At GM, our goal is to have the best dealer relations in the business. It’s one of our top focus areas in the company, and a personal priority of mine.

Akerson admits mistakes of past

GM didn’t always do a great job listening. I know that, but I can’t erase it. What I can do is tell you that we’re now working hard to re-build positive, lasting relationships with all of you.

The hard truth is that right sizing our dealer network was extremely difficult. It was also a necessary component of GM’s transformation… and it’s making a real difference.
Today, GM’s streamlined dealer network is enjoying higher throughput levels and higher profitability. But the best metric is this: more than 90 percent of our dealers are now profitable.

After all we’ve been through together, that’s great – we love to see it and we want to see it improve even more. Today, many GM dealers are using their higher profits to invest in their people, processes, and facilities.

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