General Motors CEO Mary Barra was recently a guest on CNBC’s Squawk Box morning news and business talk program, where she discussed the ever changing automotive industry, and how falling oil prices are having an affect on her company.
Industry analysts have predicted low oil prices will result in a spike in full-size GM truck and SUV sales of as much as nine percent. This is an especially positive outlook for The General, as its full-size trucks and SUVs have some of the highest profit margins of its entire product portfolio. When asked about this matter by Squawk Box, Barra recognized it is a temporary shift, and buyers will still purchase cars with the distant future in mind.
“I think in general it is a shift, but I also think they look at it – you know, the average length of ownership of a car is going up so they’re going to look at it over the long term. But it also provides a little more disposable income that they may be able to buy a richer vehicle in addition to the fuel economy aspects of it,” she said.
Barra was also asked about GM’s sales in general, not just in relation to oil prices. The automaker’s sales were up in 2014, but more importantly, it had higher average transaction prices. Barra stressed the importance of high quality sales transactions to her, not just high sales numbers.
“You know of course we look at them (sales) and we want to grow but we want to grow profitably,” she said. “So I think it’s a number that you know gets a lot of attention. I think the more important is the quality of earnings and the quality of growth and that’s what we’re focused on.”
Hear all of Barra’s remarks to Squawk Box interview in the video below.
No Comments yet