Massachusetts Institute of Technology
Sign in

Leadership in the Automotive Industry: A Conversation with Dean Emeritus Glen Urban

10/11/2006 4:30 PM E51-115 Wong
G. Richard Wagoner, Jr., Chairman and CEO, General Motors

Description: Rick Wagoner's outlook is optimistic, in spite of the bumpy road GM has traveled recently. With MIT Sloan Dean Emeritus Glen Urban, he discusses GM's aggressive recovery plans in response to $10 billion in losses last year, and his determination to regain the public's trust and confidence in GM cars. Wagoner sees new global competition creating both challenges and opportunities. India and China have opened up markets -that this industry hasn't seen ... since the 1930s, '40s and '50s.” But, continues Wagoner, -we have more than 400 thousand retirees,” all of whom are dependent on GM for benefits. -We cover about one million people in the U.S. -- 1% of people over 60 years old receive their health care from GM.” Given that people are living longer and costs of medical procedures and drugs have spiraled upward in the past few decades, GM's billions in sales are eaten up by these -legacy” costs. GM also has more than 100 thousand hourly workers who get paid whether they're building cars or not, unlike foreign auto manufacturers. But Wagoner, even with Toyota breathing down GM's back for the spot as number one auto maker, doesn't seem to sweat it. After cutting thousands of jobs and negotiating with unions, GM will look -to grow in the right places.” For instance, the company has a unique partnership with a Shanghai auto corporation, and will soon be supplying 12% of China's cars. In an aside, Wagoner mentions that the Chinese -insisted on the Buick brand” -- the last emperor drove a Buick, so it's got a -good image” over there. This is in sharp contrast to American consumers for whom the Buick name has -become polluted.” Wagoner's a bit of a skeptic around current hybrid technology, having been stung when GM rolled out a model electric car in the 1990s that everyone admired but no one purchased. He's throwing his weight behind improved fuel cells, which will be essential to a low carbon emissions car with a single propulsion system that can also compete with the internal combustion engine. Wagoner looks around and sees -other industries that haven't made it: steel, rubber, the airlines. They've dumped their historical obligations (to workers) and just said, sorry.” But he feels responsibility both to employees past and present and to the -serious, important work we're doing.” If GM can cut back on liabilities, he says, and leverage its great assets, -we'll come out the other side very well positioned.”

About the Speaker(s): G. Richard Wagoner was elected GM chairman and chief executive officer in May, 2003. He had been president and chief executive officer since June 2000. He is a member of the board of directors of General Motors Acceptance Corporation, a GM subsidiary.

Wagoner began his GM career as an analyst in the Treasurer's Office in New York in 1977. After serving GM in Brazil, Canada and Europe, he was named executive vice president and chief financial officer of GM in 1992, and also had responsibility for worldwide purchasing from 1993 to 1994. He was elected president and chief operating officer in 1998 and had been executive vice president of GM and president of North American Operations since 1994.

Wagoner received a bachelor's degree in economics from Duke University in 1975 and a master's degree in business administration from Harvard University in 1977.

Host(s): Sloan School of Management, MIT Sloan School of Management

Comments (0)

It looks like no one has posted a comment yet. You can be the first!

You need to log in, in order to post comments.

MIT World — special events and lectures

MIT World — special events and lectures

Category: Events | Updated over 1 year ago

December 13, 2011 15:08
All Rights Reserved (What is this?)
Additional Files

3984 times

More from MIT World — special events and lectures

Energy in a Global Context

Energy in a Global Context

Added over 5 years ago | 01:31:00 | 4672 views

Why Large Companies Should Out-Innovate Small Ones

Why Large Companies Should Out-Inno...

Added over 5 years ago | 00:54:07 | 3989 views

From Rocks to Genes and Back: Stories about the Evolution of Photosynthesis

From Rocks to Genes and Back: Stori...

Added over 5 years ago | 00:42:49 | 8124 views

Transportation, the Built Environment and Greenhouse Gas Emissions in Developing Cities

Transportation, the Built Environme...

Added over 5 years ago | 00:59:46 | 7434 views

The Innovation Economy: How Technology Is Transforming Existing Industries and Creating New Ones

The Innovation Economy: How Technol...

Added over 5 years ago | 00:36:53 | 3298 views

Learning to See in the Dark: The Roots of Ethical Resistance

Learning to See in the Dark: The Ro...

Added over 5 years ago | 01:10:00 | 11121 views