General Motors

Tired of all the doom and gloom bringing down the auto industry these days, Consumer Guide went out in search of positive news. In this, the second of three exclusive executive interviews, we talked with Mark LaNeve, General Motors' North American Vice President of Vehicle Sales, Service, & Marketing.

LaNeve told us why things are looking up for the automaker. We asked Mark for three reasons the public should feel good about General Motors. We threw in our two cents for good measure.

Reason One: Global Strength and Resources

Saturn's new Astra is built in Belgium and sold under the Opel name in Europe.

Mark LaNeve: GM is focused on building sustained success and not just one that yields short-term results. In doing so, we are building a company that can compete successfully on a global level.

In the last decade, we built a global product development network that includes 13 engineering centers and 11 design studios worldwide. This setup allows each center to focus on vehicle types they do best. It also produces global standards for GM that not only result in high quality everywhere, but also allow for variations in styling and features offered in regional markets. Under the new global product development system, we're getting products to market faster and paying much more attention to details.

Additionally, in the fastest-growing markets in the world, GM is expanding at a record rate. Consider the fact that in 2007, our total global sales climbed to the second-highest level in our 100-year history: 9.37 million vehicles.

Those emerging global markets boosted GM's total sales in 2007, and for the third year in a row--and only the third time ever--we sold more vehicles outside of the United States than we sold here. Fifty-nine percent of all our sales, or 5.5 million vehicles, came in foreign markets, and we set sales records in growth markets like Brazil, Russia, India, and China--which is our second-largest market in the world.

CG Says: General Motors' rapid growth in Asia and Eastern Europe speaks well for the company's overall health and vigor. Lost in the media coverage of last year's GM-versus-Toyota global sales battle was the fact that GM was a breath away from its best-ever sales year.

While the U.S. market has become a smaller chunk of GM's corporate entity, it is still big enough to drag the rest of the operation down. But, of the Detroit Three, GM's global operations are clearly the best developed and most likely to sustain North American operations through a rough patch.

Reason Two: Better Product

General Motors plans to focus on its small car lineup. Look for the compact 2010 Chevrolet Cruze in 2009.

Mark LaNeve: The proof is in our cars and trucks today. We don't have to say our products are getting better, because they already are. GM is committed to product excellence and continues to show leadership in the areas of quality and design, while catering to consumer demand through our diverse product mix.

According to both our internal metrics and independent surveys, GM vehicle quality is competitive and continues to improve. We have seen our warranty repairs reduced by 40 percent over the past five years, and we are backing up confidence in our products by offering the best warranty in the business: a five-year/100,000-mile transferable warranty covering 900 parts on all 2008 and 2009 GM cars and trucks.

Our new products are also receiving extraordinary reviews from industry experts and enthusiastic support from consumers. In just the last three years, the (Chevrolet) Malibu and the Saturn Aura were both named North American Car of the Year; the Cadillac CTS was named Motor Trend's Car of the Year; and the Volt, the Aero X and the Camaro (concepts) were widely recognized as the stars of the auto shows where they were introduced.

As the industry is currently seeing a rapid shift in consumer demand for more fuel-efficient vehicles, GM is responding by introducing additional new and exciting cars and crossovers. The transition has been underway at GM for several years, and our capacity to produce these products is in place and ready to go. Eleven of the last 13 major U.S. launches for GM have been cars and crossovers, and consumers should expect 18 of our next 19 major U.S. launches to be cars and crossovers as well.

GM has been and continues to be a leader in delivering a broad range of fuel-efficient vehicles to customers. In addition to the 17 models for 2008 that achieve 30 mpg or better on the highway, many of our vehicles either win or are strong contenders in their segments.

Consumer Guide: Your product renaissance examples are fairly new models. With what product would you say GM turned the corner on design and quality?

Mark LaNeve: It goes back to the first generation (2003 Cadillac) CTS. With that car we made it very clear that we were serious about building world-class products. Since then, every new car we've introduced has met with acclaim. The Cadillac Escalade, Saturn Aura, Buick Enclave, Chevrolet Malibu, Pontiac G8, and Pontiac Vibe have all received high praise from owners and the media.

CG Says: Apart from the G8 and Vibe--both of which were introduced since last-year's voting--all of the models cited by LaNeve as part of GM's higher-quality lineup have received Best Buy or Recommended recognition from Consumer Guide. There's little question that GM's recent introductions are all at least competitive, if not class leading.

There is still serious need for additional product at the small end of GM's lineup. Across all of GM's U.S. brands, the maker offers just five compact or smaller models. Of these, Chevy Aveo is one of the few subcompacts not in high demand, hampered mostly by inexplicably mediocre EPA fuel-economy ratings. Also selling slowly is the Saturn Astra. Based on the Opel of the same name and built in Belgium, Astra is hamstrung by weak-dollar-induced sticker-price inflation.

Chevrolet's likable, efficient Cobalt is hot though, and a planned third shift at the car's Lordstown, Ohio, assembly plant will help GM capitalize on the car's sudden popularity.

All eyes are on the coming compact that may or may not eventually replace the Cobalt. Due as a 2010 model sometime in 2009, the Chevy Cruze has the potential to make GM a serious player in the domestic small-car game. Promised is a small-but-strong direct-injection turbocharged engine with "class leading" fuel economy. GM needs Cruze to be its next product renaissance success story.

Reason Three: Innovation

GM expects the 2011 Chevrolet Volt extended-range electric vehicle to travel up to 40 miles on electric power.

Mark LaNeve: We are reinventing the automobile and our company. Our customers want a break from high fuel prices and so do we. That is why we are demonstrating leadership and fully leveraging our global technology resources to address pressing automotive energy needs with biofuels such as E85 ethanol, hybrids, extended-range electric vehicles, and hydrogen fuel cells.

By the end of 2008, GM is expected to offer more hybrid models (eight) in the United States than any other automaker.

However, the green technology game-changer, in our opinion, is the Chevrolet Volt concept, which we unveiled more than one year ago. The Chevrolet Volt is leading a new era of electrification of the automobile by creating a new class of vehicle known as the Extended-Range Electric Vehicle, or E-REV. The Volt uses electricity to move the wheels at all times and speeds. For trips up to 40 miles, the Volt is powered only by electricity stored in its 16-kWh, lithium-ion battery. When the battery's energy is depleted, a gasoline/E85-powered engine generator seamlessly provides electricity to power the Volt's electric drive unit while simultaneously sustaining the charge of the battery.

CG Says: A few years ago, Honda and Toyota were the only players in the hybrid game. Though a late bloomer, GM will offer more hybrid models than any other manufacturer in 2009. And while detractors are quick to condemn the "mild hybrid" system offered on GM's Chevy Malibu, Saturn Aura, and Saturn Vue as a mere technological stopgap, Consumer Guide testing finds the budget-priced system simple and effective, with a recently evaluated Vue returning better than 30 mpg in real-world driving.

More impressive is GM's 2-Mode Hybrid system. In Consumer Guide testing, the scalable drivetrain helped the almost 6,000-lb Chevy Tahoe Hybrid deliver nearly 23 mpg in mixed driving. While an outstanding hybrid system alone is not reason enough to feel good about a company, it does demonstrate renewed technical prowess and determination from a company that was long referred to as the sleeping giant.

Perhaps more abstract is the near-term impact of the Chevy Volt. Drawing as much press attention as a Brangelina baby, Volt's promise of potentially petroleum-free daily commuting is irresistible to an inflation-weary nation.

There is little-to-no chance that GM can convert a successful Volt launch into any semblance of profit in the vehicle's first generation. The best the maker can hope for is to amortize the development costs and move the technology quickly (and cheaply) to more mainstream product.

That isn't to say Volt's success won't result in near-immediate payback. By almost every measure, Volt represents one of the most ambitious--and most scrutinized--projects in modern automotive history. The halo effect from selling what is potentially the world's greenest and most fuel-efficient automobile cannot be overstated.