GM's 90-Day Progress Report

90 days out of bankruptcy, GM is taking a moment to explain just how well the turnaround thing is going. Or, to use the PR-present tense, how GM “Accelerates its Focus on Customers, Cars and Culture.” CEO Fritz Henderson explains in the report press release (PDF):

Over the past ninety days since we created the new GM, we’ve already launched a number of new, fuel-efficient, highly successful cars and crossovers; introduced a new marketing campaign that highlights our best-in-class fuel economy, quality, warranty and safety performance; sworn in a new Board of Directors; and overhauled our management. We are taking aggressive actions and moving quickly to transform our culture into one that is truly customer focused

Everything you need to know about this exercise in corporate affirmations (I’m good enough, I’m smart enough, and doggone it, people like me!) can be found in the slide (above) titled “Concerns” from the report’s accompanying presentation (PDF). Nothing about the crisis surrounding Daewoo. Nothing about a steady erosion in sales that no marketing effort has been able to turn around. Nothing about binge-and-purge inventory “management.” Nothing about the near-impossibility of showing a profit by the planned IPO. In short, GM glossed over its issues like a 12 year old with her first stick of Lip Smackers.

Little encapsulates GM’s “we’re still changing but everything’s fine” line as well as the departure of Mark LaNeve. Hated by many dealers, and the architect of years of dismal sales results, LaNeve is a perfect symbol of old GM (but hey, what senior exec at New GM isn’t?). And on the one hand, GM is using his departure as an opportunity to say things like “we are taking aggressive actions and moving quickly to transform our culture into one that is truly customer focused.” In fact, Henderson went as far as to say “I do think there is a benefit to bringing in outsider. I think we would benefit from fresh perspective.” But Henderson also refused to use the opportunity to draw a line in the sand on sales results, preferring to let his euphemism that “Mark’s going to join another company to pursue an interest outside the auto industry,” dangle ominously. At least it would have been ominous, had LaNeve not overseen eight years of weak results before being allowed to “pursue other opportunities” post-bankruptcy.

The rest of the report is full of cheery optimism, that seems more based in turn of phrase and cognitive dissonance than reality. Under the heading “Improved Sales Performance,” The General notes “the company’s U.S. market share was 19.5 percent in the third quarter, consistent with the first half of the year. U.S. market share in 2008 was 22.1 percent.” How is that “improved” in any way? The dealer wind-down portion says nothing of ongoing meetings between dealers, GM, Chrysler and congress which have the potential to restore lost franchises, and undo GM’s dealer cull. Sales of the Hummer and Opel brands are noted as “ progressing,” despite one rejection of the Hummer deal by China, and threats of EU intervention in the Opel transaction (not to mention potential negative effects of the Opel sale, should it go through).

And this optimism isn’t going away. In preparation for its IPO, and “as a newly created entity, GM is continuing to implement “fresh-start” reporting, which encompasses the determination of the fair value of its assets and liabilities, by March 31, 2010.” And then comes the IPO. GM has proved that it can ignore looming problems literally for decades, so why not a few months? There’s always time to worry about things after investors re-prop-up the company.