You need a scorecard to keep track of whom General Motors Corp. is wooing, cooing to or simply holding hands with and talking partnership, alliance and joint venture.
GM President Rick Wagoner shed some light last week on the activity between the company and those who may join the family.
Here’s a rundown:
– Subaru: The Japanese automaker was on the verge of disappearing from the U.S. market until the Outback sport-utility/station wagon hybrid came along. This would give GM access to the Japanese market and an automaker close to the Southeast Asian market in which GM wants to roam, as well as a source of sport-utility hybrids for the U.S.
“Our next building block is Southeast Asia, and we need to have a successful presence there. Our weakest shares are in those fast-growing markets. We need to get bigger in those regions,” Wagoner said at an auto parts-makers trade show in Las Vegas.
“But would Subaru have the right models 10 years from today? We’ve had conversations with Subaru, but I won’t elaborate,” Wagoner said.
At the least, GM might acquire a stake in Subaru.
– Daewoo: The South Korean automaker would give GM access to a new market while giving Daewoo an outlet for its vehicles outside the home country.
“The Korean market is big, but you can’t play in that market without being there. The financial risks need to be sorted out. Daewoo is restructuring. Its financial position isn’t good. If they can’t be run profitably, we wouldn’t take them on. The conversations have been intense. We’re moving as quickly as we can and pushing for a decision. We’re bouncing numbers and analyzing data now,” Wagoner said.
One thing is clear, GM wants control of Daewoo, not just a stake in it.
– Saab: With Ford acquiring all of Volvo, and GM owning only 50 percent of its Swedish rival, GM might have to purchase 100 percent so as not to look like a pauper.
“Talks are ongoing. We have until Jan. 31 to make our call (to increase ownership to 100 percent). Saab isn’t as taxing an issue to us as Daewoo. We don’t have to own 100 percent to see Saab grow and prosper. We could stay at 50 percent and don’t need to pay a massive premium (to acquire 100 percent).
“Saab’s on track to be successful with higher quality and newer products. The question is whether Saab can grow as fast as we want them to grow. If we don’t work this out, it’s not the end of the world,” Wagoner said.
– Toyota: GM has a link with Toyota in its joint production venture, the New United Motor Manufacturing Inc. plant in Fremont, Calif., that produces the Corolla car and Tacoma pickup for Toyota and the Prizm car (a Corolla offshoot) for Chevrolet.
This year the two entered an agreement to develop and share technology on alternative-fuel vehicles, which most assume will lead to developing and sharing such vehicles.
“We’re satisfied with the work the teams are doing and the progress being made on the tech projects. After the first of the year, we’ll move along on some broad-based technology vehicles. GM and Toyota compete heatedly against each other, but in these technology areas we’re working together. I don’t want to say any more on those project teams,” Wagoner said.
As for New United Motor Manufacturing, “We have no plans not to continue (the joint production venture). There’s not any smash hits being built there for GM, but soon we’ll make a call on the next generation of products, and we see some promising new vehicles. We think NUMMI will be good. They (Toyota) highly value it and so do we, and we both want to continue,” he said.
“There’s been a natural evolution in the industry to move off the `everything you do, do for yourself.’ Basic economic pressures drive people today to say that the bets are too big to do alone. If one company wants to do 100,000 vehicles and the other wants to do 100,000 vehicles, put them together and both do them. You don’t have to do full mergers to realize full benefits,” Wagoner said.
Speculation is that GM will drop Prizm and add a small Toyota RAV4-type SUV or a small Toyota Prius gas/electric hybrid-type car or both.
While intent on new business opportunities, Wagoner voices regret on an opportunity lost.
“When I see people pass in one of our cars using a cell phone, I say, `Those are your cars, those are your customers, those should have been your cell phones.’ We should have had our own cell phones. Someone is making a lot of money off of them.”
