General Motors CEO Dan Akerson opened the 2012 annual stockholders meeting in Detroit by stating that 2011 was a good year for the automaker, but it was not a great one. Akerson, who is nearing the completion of his second year as the automaker’s chief executive, reflected that him and his team have “much more work to do to make GM great again” — partly referring to increasing the automaker’s profitability.
“To be great, GM must close this [profitability] gap by steadily improving our margins and that will be the focus of my remarks today,” said Akerson. “It’s fundamental to earning a blue-chip multiple for GM stock and ensuring that the company will be successful for generations – not just a few quarters or a few years.”
Akerson then went on to explain how The General is in the early days of one of the biggest global product offensives in its history and that the effects of this offensive will be especially perceived in the U.S. market — where about 70 percent of the automaker’s nameplates will be new or refreshed over the course of 2012 and 2013. Many of these vehicles will bring GM to new segments where it has never competed before, such as the Buick Verano and Verano Turbo.
Akerson also addressed the unprofitable Opel division by saying that GM plans to invest billions in new models while sorting out overcapacity and high fixed costs in the region. Other topics of interest include the automaker’s presence in vital growth markets such as Brazil, Russia, and China, a new cost discipline throughout GM, a strong balance sheet, and a change in product development that will result in a 50 percent decrease in vehicle architectures.
Ultimately, Akerson announced that the automaker plans on spending $8 billion annually to support all of these plans and placed a special emphasis on keeping this spending stable — even during peaks and troughs experienced by the industry, and economy, at large. The strength of the firm’s balance sheet will assist it in this regard.
Feel free to scan Akerson’s entire address to shareholders below for yourself. But if anything is clear to us, it’s that The General will start kicking ass and taking names very, very soon. It just so happens that it’s in a unique state of limbo in this point in time — the calm before the storm, if you will.