This week, Barclays analyst Brian Johnson attended a sell-side dinner hosted by General Motors Company GM 1.6% CFO Chuck Stevens. In a new note, Stevens broke down 8 takeaways from the dinner:
- 1. Despite market fears that the U.S. auto market is peaking, GM management sees continued strength given a healthy U.S. economy.
- 2. Management sees a number of catalysts ahead for GM, including a product refresh in passenger cars, cost savings and growth opportunities in its aftersales business, OnStar, Maven and Cadillac.
- 3. GM may be able to up its cost-cutting target of $5.5 billion by 2018 given that the company is expecting $4 billion in cuts by the end of 2016.
- 4. GM is aiming to reduce lease penetration from the high 20 percent range to the mid 20 percent range.
- 5. GM is focusing its passenger car business on the global market and plans to shrink its U.S. passenger car footprint and free up 30 percent of its core capital for reinvestment and/or capital return.
- 6. GM’s variable profit per unit was higher in the first half of 2016 than the first half of 2015.
- 7. Management is…
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