GM
#Well, certainly, as we go through the launch cadence not only on passenger cars and new entries in the Cadillac portfolio and refreshing the oldest crossover lineup, we would expect to see that profit dynamic shift and obviously improve those profit pools in passenger cars and crossovers, vis-a-vis trucks.
The other thing that's just mathematically impacting that shift from the 2014 K to the 2015 K is we are selling more vehicles in Mexico and obviously, there are more passenger cars there and they are lower priced, lower profit, obviously lower cost and that's having an impact as well.
Relative to trucks, the way you protect your profit pool in trucks and SUVs, great products, great brands, continue to take advantage of that, align supply and demand and continue to drive cost efficiency and our trucks well into their lifecycle continue to perform very well.
We had just under 38% retail share in the first quarter.
We continue to lead in the industry.
We just launched a refreshed truck, which will carry us to the next generation truck and we feel very confident that we will be able to protect those pools because we've got great products.
Well, as I mentioned earlier, <UNK>, overall, the lease portfolio continues to perform well for GMF.
Obviously, trucks and SUVs are performing very well.
Cars are performing not as well as they had been, but at a portfolio level were okay.
We talked about very specifically our strategy to reduce our daily rental fleet sales and that's really focused on repurchase because, at the end of the day, what we are trying to do is reduce our exposure to the used car market, continue to focus on retail deliveries, which drives better residuals ultimately and better owner loyalty.
So that's part of the strategy as well.
Well, first, talking about connectivity, I really think when you look at putting the customer at the center of what they want, they want that in today's business.
So it's vital to have integrated into the vehicle from a tech perspective to meet and exceed the wants and desires of customers today.
From an autonomous perspective, I appreciate your comments.
I think we are looking at it very seriously and with the extensive technology capability we have inside the Company, along with scale and understanding how to do and execute vehicles with this type of technology safely, I think it is something that really is an opportunity for us and that's why we are moving so quickly on it.
But I think right now when you look at it, it's looking at how the business is going to evolve and we will look at that over time.
But the technologies I see are ---+ many are very core to selling vehicles today.
And even on autonomous, that's a journey.
There's an evolutionary path and a revolutionary path and we are working on both.
Well, I touched on this before, but when you look at it, first of all, we have two global brands, Chevrolet and Cadillac.
And there's also pure EV like we have with the Bolt EV that will be coming out later this year.
We have extended range electric vehicles with the Chevrolet Volt, but then we also have a lot of electrification, the Malibu hybrid and we will be launching over 10 new electrified vehicles in China.
So to us really the electrification is something that we integrated in the portfolio that allows us to build not only our capability and spread it broadly and reach more customers, but also to build those brands so they are viewed appropriately as technology leaders.
And I think we continue to do that, so we see it as core and integrated.
Yes, again, going back to the comment I made earlier, I think look at working capital separately, which was a $400 million impact versus $600 million at the first quarter of 2015.
When you look at accrued and other liabilities, that's the other line that is impacted by reduced customer deposits associated with daily rentals.
So as we sell less daily rentals, we get less customer deposits.
As we de-fleet, it has an impact on operating leases, so you got to kind of look at those two lines together and net-net, it was a $1.1 billion impact in the first quarter of this year versus $1.5 billion last year, which is a $400 million improvement, broadly speaking.
Well, we borrowed $2 billion.
We will have contributed $2 billion.
We are done.
Obviously, that was, as we talked about it, a risk management approach to push out some of the timing on the liabilities into a 20 and 30-year timeframe and push out mandatory contributions from maybe 2019 and 2020 to the early 2020s, 2022, 2023.
We would expect, as interest rates increase, when they increase, that that will help close the remaining gap at least from a US perspective going forward.
Well, one, our subprime portfolio originations have been relatively constant over the last number of years, so we are not growing that.
That's first.
Two, AmeriCredit, now GMF, subject matter experts in subprime and managing the risk associated with subprime.
Third, our delinquencies and credit losses associated with subprime have been very stable over the last number of years.
We see no incremental risk associated with that.
And then, finally, we are running today originations as we execute our captive strategy.
80% of originations are prime, near prime.
So again very stable levels of subprime activity at GMF.
Yes, we've talked about with the Bolt EV and with the strategic work that we do with LG and with some other key suppliers, but we think we are on a path with the Bolt as we launch and get to scale of being in an industry-leading position of $150 and then continuing to improve that down.
So we work very closely on that.
We think it's key and when we ---+ not that we talk about it specifically with numbers, but we've seen dramatic improvement from the first generation of the Volt to the second generation of the Volt that is carried into the Bolt EV and will continue to drive that down.
I believe it's all in, but I think when you say all in, everybody may have a slightly different definition of what they mean when they say all in depending on how they have architected the vehicle.
We can provide more detail on that, but again I think there's some variation in how people are defining that.
Thank you.
Thanks, <UNK>.
Nothing has changed vis-a-vis the China fundamentals versus what we've been talking about for the last year or so.
Fundamentally, price continues to be a challenge.
Last year it was in the range of 4% to 5% negative price headwinds.
On carryover, we expect that same level this year.
That's what we've seen play out so far in the first quarter and we are offsetting that impact through significantly improved mix and you saw some of those results ---+ the Envision as an SUV, sales up significantly; the Baojun, 560.
We are launching critical new products like the Cadillac CT6 and the XT5.
So mix has been a mitigant to the price headwinds, as well as carryover material performance.
And when I look at those two together, they kind of offset the price headwinds and where you see the benefit, at least on an aggregate equity income or profit perspective, is volume.
And we would expect to see that play out.
Obviously, we continue to focus very much on cost efficiency, both material logistics and fixed costs, but broadly speaking favorable volume, favorable mix as we improve our Cadillac portfolio and launch more crossovers and MPVs, favorable material performance offsetting or more than offsetting price headwinds, as well as fixed cost increases, we bring up new plants.
That's the broad strokes, <UNK>.
Well, we expect for us specifically we had pretty strong lease penetration in the first quarter driven by again some of the model wind-down efforts around Malibu, Cruze and the SRX.
We would expect to see that moderate.
We will be somewhat below industry average because trucks don't lease at the same levels and obviously, we are overweight in trucks.
So we would expect to see that continue.
We are taking a number of actions to make sure we optimize residuals.
We talked about the Express Drive rental hubs, anything that you can do ---+ the factory pre-owned collection ---+ anything you can do to take that supply out of the auction generally will help residuals over time and clearly that's a focus that we have going forward.
Well, thank you very much and thanks, everybody, for joining the call this morning.
I have to say I'm extremely proud of the team for what they were able to accomplish this year, but we know we have more opportunity as we go through the year.
We are going to continue with the discipline and detailed focus on strengthening the core business and the adjacencies, but also taking advantage of growth opportunities and our ability to lead as personal mobility is transformed and redefined.
Thank you.
