New General Motors lives

As the beleaguered American corporation emerges from bankruptcy, General Motors president and CEO Fritz Henderson is promising a more intense, decisive and speedier company better equipped to react to the changing conditions in the car industry.

The New General Motors Company announced on Friday that it had exited bankruptcy court as a leaner new organisation. Henderson (pictured) immediately promised to get back in the business of trying to create new cars and rebuild the brand's tarnished image.

"Today marks a new beginning for General Motors, one that will allow every employee, including me, to get back to the business of designing, building and selling great cars and trucks and serving the needs of our customers," said Henderson.  "We are deeply appreciative for the support we have received during this historic transformation, and we will work hard to repay this trust by building a successful new General Motors."

As expected the New GM has taken on the so-called "good assets" of the old company. That means the new structure will focus on just four key brands -- Chevrolet, Cadillac, Buick and GMC -- and retain the largest dealer network in the US. It also means the company has been able to clear debts and create a "cleaner balance sheet, and a stronger liquidity position."

Henderson is promising a new era for the company; far removed from its large, slow-moving structure and culture that has been blamed for its demise.

"One thing we have learned from the last 100 days is that GM can move quickly and decisively," Henderson said. "Today, we take the intensity, decisiveness and speed of the past several months and transfer it from the triage of the bankruptcy process to the creation and operation of a new General Motors.

"Business as usual is over at GM. Today starts a new era for General Motors and everyone associated with the company. Going forward, the new General Motors is fully committed to listening to customers, responding to consumer and market trends, and empowering the people closest to the customer to make the decisions. Our goal is to build more of the cars, trucks, and crossovers that customers want, and to get them to market faster than ever before."

As expected the New GM is primarily owned by the US Government, which has taken a 60.8 per cent share. The remaining ownership is split between the UAW Retiree Medical Benefits Trust (17.5 per cent), Canadian and Ontario governments (11.7 per cent) and Old GM (10 per cent).

With the governments having loaned significant amounts of money to keep GM afloat over the past months, the New GM will need to now focus on paying those loans back. Although full repayment is not required until 2015, Henderson has said he wants to achieve the target "much sooner".

Through the bankruptcy proceedings and recent negotiations New GM has been able to reduce its financial obligations by over US$40billion and now only has US$11billion in debt. That should mean a lower break-even point for the company allowing it to return to profitability sooner.

Henderson was optimistic that its forthcoming new product will help get the turnaround started. The Cadillac CTS Sport Wagon and GMC Terrain will launch later this year before the Chevrolet Cruze and Cadillac CTS Coupe arrive in 2010, along with the critically important Chevrolet Volt.

"A successful auto company needs to focus on both the cost and the revenue sides of the business," Henderson said. "Success on the revenue side means building the stylish, high-quality, fuel-efficient vehicles that customers want -- and getting them to market fast."

Locally, Holden claims it is still "business as usual" with New GM officially acquiring the old company's foreign subsidiaries as part of the restructure.

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