It’s been five years since General Motors became “New GM” and sealed the coffin of “Old GM”. Much has changed as a whole in half a decade, as we round out way into the final stretch of the oh-tens, but some analysts question whether GM CEO, Mary Barra’s, statements on a “vastly different” automaker ring true.
The Detroit News broke down the automaker’s standing in financial performance, corporate culture and other essential components to create a healthy GM for the future, and finds ups and downs.
The good, which has been noticeable through Barra’s leadership, is a true change in corporate culture. As the report notes, the “not-my-problem” ethos has become more a “your problem is my problem” distinction, where taking responsibility of actions and its performance rating system reflects that.
The bad sits in GM’s share price, which continues to hover around its IPO price of $33 per share. Although, the automaker’s comeback in North America cannot be ignored, with share prices reflecting the most recent financial reports. GM managed a pre-tax net income of $3.1 billion, and profit margins were up 2.2-percent year-over-year. Investors continue to push for maximization of their shares, something Barra intends to accomplish, but hasn’t thus far.
“Market share is nice,” said David Cole, chairman emeritus of the Ann Arbor-based Center for Automotive Research and a longtime GM watcher. “Profits are critical. We have seen that adjustment at General Motors. Profitability is the critical thing.”
Cole continued on to say it has become obvious GM is not afraid to lose its market leadership for profitability to reward the company’s shareholders, which leads to new investment and a change in perception.
You can read the entire analysis of the automaker at the link here.