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March 3, 2011updated 08 Apr 2021 8:13am

GENEVA: GM CEO cautions against complacency, mulls oil instability

General Motors says it still has some way to go in maintaining its recent positive performance that saw four successive quarters of growth.

General Motors says it still has some way to go in maintaining its recent positive performance that saw four successive quarters of growth.

Following a hugely successful IPO last year, the US automaker recently posted a profit of US$4.7bn and gave its GM Plan employees a US$4,000 bonus.

“Four successive quarters [of growth] is a milestone, it is not a cause for celebration,” said GM CEO Dan Akerson at this week’s Geneva show. “Things are better but we have a lot of work to do.

“[The] first full year after bankruptcy…the IPO was a startling turn of events. Frankly, I did not think the IPO [would be] as successful – it was the largest in the world.”

The GM chief also ran the rule over the current spike in oil prices given their potential impact on automakers, although he noted there was an even higher cost per barrel in 2008 of US$140.

The current “civil unrest and geopolitical movements,” notably in oil-producing Libya, are clearly causing jitters across world stock markets and Akerson touched on the effects of sharp price increase to manufacturers.

“I think oil prices are going to increase as we come out of the global recession, we are very aware of that,” he said. “If Gaddafi would leave office today, oil would probably drop US$5-US$10 a barrel.

“There are some stop gaps we could put in place but, if oil were to see a huge spike, if the Straits of Hormuz were closed, we would see consumer confidence on a worldwide basis drop. If any CEO tells you different, he is whistling past the graveyard.”

Akerson – formerly in the US Navy – also turned to nautical metaphors to describe recent losses posted by GM’s European division Opel/Vauxhall.

“When your ship lists, you have to right it and we are getting it under way in Europe,” he said. “Europeans are not different from Americans – they love an underdog and they love a team that comes from behind and wins.

“We are not going to stand back and watch events overtake us.”

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