December 19th, 2012 at 11:56am
General Motors announced this morning it’s going to buy 200 million shares of its stock from the U.S. Treasury. We’ve looked at the sales numbers for hybrids and electric cars in China, and they’re miserably low. GM just appointed a new vice president of purchasing, Grace Lieblein. All that and more, plus host John McElroy gets to your questions and comments in this week’s edition of You Said It!
Thanks for joining us today as we take a look at the latest developments in the global automotive industry.
GM TO BUY BACK STOCK
General Motors announced this morning it’s going to buy 200 million shares of its stock from the US Treasury. GM will buy the shares for $27.50, well above where they’ve been languishing for over a year. The company will lay out $5.5 billion to buy these shares. But it still won’t shake the Government Motors label with this move. The government will continue to hold 300 million GM shares, but it says it will start selling them over a 12 to 15 month period starting in January. GM stock jumped 10% on the news.
LET’S SAY GRACE
Well it took nearly three months, but GM finally figured out who to put in charge of its massive purchasing operations. Grace Lieblein, 52 years old, is the new vice president of purchasing at GM, which oversees a budget of about $100 billion a year. Remember this name. Though she’s been with GM her entire career, starting as a co-op student, Grace Lieblein has been rocketing up the corporate ladder recently. A decade ago she was chief engineer on GM’s Lambda platform, the Buick Enclave, GMC Acadia and Chevy Traverse. Today she’s one of the senior most officers in the company. And somebody out there correct me if I’m wrong, but I believe she is the first woman to head up purchasing at any car company.
OUCH, THAT HURTS!
We’ve been reporting for years on the high cost of license plates in some major Chinese cities. Here’s the latest. A new license plate in Shanghai now costs $11,000 about the same price as a Toyota Yaris in China. And that makes car sales in China all the more impressive.
CHINA NOT KEEN ON EV’S
Speaking of China, we’ve got the latest sales numbers on hybrids and electric cars in China, and they’re miserably low. Only 10,000 of them will sold in the country this year. The figure is just for Chinese made vehicles since import sales aren’t significant enough to count. Interestingly the Toyota Prius is the top selling hybrid despite not receiving any government subsidies.
AN AFRICAN DIESEL
We all knew Ford was putting a diesel engine in the U.S. version of the Transit van. What we didn’t know is that diesel will come from South Africa. The 3.2 Liter 5-cylinder Duratorq diesel is built at Ford’s Struandale Engine Plant in Port Elizabeth, South Africa. If sales of the engine go well we have to wonder if we’ll see it in an F-Series truck.
Coming up next, You Said It!
jack879 heard us report on GM’s sky-high inventory levels, but wants to know, “How many days of inventory does GM have with cars, not counting pickup trucks?” It’s a scary number, Jack. GM has 111 days of inventory of passenger cars. Cadillac is at 143, Buick is at 120 and Chevrolet at 105. At this time of year, because it varies from winter to summer, an automaker that’s running its production schedule properly should have about 70 days of inventory.
C-Tech heard us talking about Michigan, the home of the UAW, has now become a right-to-work state and wants to know, “What does right-to-work really mean? It seems these laws are more rights-to-management-to-do-whatever-to-employees.” C-Tech, right to work means you don’t have to join a union if you don’t want to. And, you don’t have to pay any dues or fees to a union if you don’t want to. Up to now, if you wanted to get an hourly job at GM, Ford or Chrysler you had to join the UAW. Soon, in Michigan, you can choose whether you want to join or not.
Jim Bielecki is asking, “Is the Silverado still a cam-in-block engine with pushrods?” Yes, the latest generation of small block V-8 from GM still uses a pushrod design. And while many people consider that passé, remember that these engines tend to be more compact, lighter, significantly cheaper to manufacture, and easier to adapt to cylinder deactivation.
Bradley is wondering what goes into choosing the North American Car of The Year award. “Should how the car is marketed be considered in assessing COTY?” Nope, it’s all about the car, it’s styling, quality, performance, and fuel economy, not about the advertising or marketing.
And Bob Aubertin, like many people is stupefied. He wants to know, “How can a Ford C-Max & Madza CX-5 be even close to resembling a truck? Who sets the criteria?” Bob, in this case, the government does. Both those vehicles are classified as trucks for fuel economy purposes. But I can assure you, every year the NACTOY jury has a slam-bang, drag ‘em out argument over what vehicle should go in which category.
Aliisdad wants to know, “Why are there still two ‘truck’ divisions at GM? How many people REALLY need a large pickup?” Ali, the government wanted to kill off GMC when it restructured General Motors. They wanted to kill it off, that is, until they saw how much profit it generates.
And now your take on those horns that honk when you lock your car with the remote. T. Bejma points out, “Just about every single GM vehicle sold today (might be every one) has the ability to customize the signal for the door locks with the Driver Information Center, so eliminating the horn is as simple as scrolling through a few menu items.”
And Seth says, “Sorry John but you’re wrong about the horn. I listen for my horn to beep all of the time. Also my vehicle, a Ford Excursion, will make a different horn beep if any of the doors aren’t completely closed.” So there you have the other side of the story.
Thanks for all your letters and comments, we appreciate getting them.
Coming up next month we’ll be webcasting live from the Detroit Auto Show. We want to thank Chrysler for hosting us at its display stand and we’ll be bringing you the latest news from the show on January 14th and 15th, and a surprise webcast on the 17th. More details to follow.
And that wraps up today’s report, thanks for watching we’ll see you tomorrow.