GM expects coronavirus rebound with lower costs: CEO
GM's reduced cashburn strategy during COVID-19 shutdown appears to have paid off
General Motors Co should emerge from the coronavirus pandemic with a permanently reduced cost base after it scrambled to reduce its cash burn to withstand a two-month shutdown in North American production as part of efforts to halt the spread of COVID-19, its top executive said on Tuesday.
GENERAL MOTORS EKES OUT PROFIT AS CORONAVIRUS SLAMS BUSINESS
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| GM | GENERAL MOTORS CO. | 55.68 | +0.81 | +1.48% |
“We were quickly able to take out significant costs and we are being very conservative about what costs we turn back on,” Chief Executive Officer Mary Barra said during an investor event with Credit Suisse. “I believe we will come out of this with a lower cost structure that is permanent.”
Mary Barra, CEO of General Motors, attends the annual Allen and Co. Sun Valley media conference in Sun Valley, Idaho, U.S., July 12, 2019. (REUTERS/Brendan McDermid)
LOCK YOUR CARS! VEHICLE THEFT SPIKES IN COVID-19 PANDEMIC
Barra said those permanent cost reductions could included few different vehicle platforms offered by the No. 1 U.S automaker and reducing the complexity of those platforms to be more focused on producing the versions consumers want most.
She said that the pandemic had given GM the opportunity to go through all of its line item expenses and eliminate redundant processes.
CLICK HERE TO READ MORE ON FOX BUSINESS
“We’ve found things that we don’t need to do and things we can do more efficiently,” Barra said.
The U.S. automotive industry has been ramping up after the coronavirus shutdown, and major automakers have been keeping a close eye on suppliers in Mexico to see the pandemic disrupts the flow of parts.
READ MORE ON FOX BUSINESS BY CLICKING HERE
Barra said on Tuesday if there are problems in GM’s supply chain, the automaker will focus on diverting parts for its popular, highly-profitable pickup trucks.