GM's Barra: Smoother vehicle development saves $1B a year
Photo credit: JOE WILSSENS
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DETROIT -- General Motors product chief Mary Barra today said GM has largely eliminated the on-again, off-again nature of its vehicle development programs, part of the company's broader goal of reducing costs and complexity.
Barra told the Automotive News World Congress that GM's biggest focus last year was "eliminating churn," which she described as "the changes, the delays, the cancellations" that have long plagued GM's product-development process.
"That can really demoralize our designers and engineers," Barra said. Until recently, she said, the problem has drained about $1 billion annually from GM's bottom line.
Barra told reporters after her speech that "the lion's share" of those losses has been eliminated because GM has fine-tuned its product-development process to avoid program cancellations and major changes.
"The starting, stopping, majorly changing scope -- that's done," she said.
'Core' architectures
In August, Barra first outlined GM's goal of eliminating those losses in part by consolidating its global vehicle platforms from 30 in 2010 to 14 by 2018. By then, GM wants to build 90 percent of its vehicles on just eight "core" architectures — the platforms of parts and subcomponents that underpin its cars and trucks.
Barra said today that about 50 percent of GM's vehicles are being built on core platforms, up from 30 percent in 2010.
Barra, 50, was tapped by GM CEO Dan Akerson in January 2011 to lead its $15 billion product development division, replacing GM Vice Chairman Tom Stephens, who became global chief technology officer. She said today that she's overseeing 113 major product programs around the world.
Barra comes from a GM family. Her father was a die maker at Pontiac for 39 years and retired in 1980. That same year, Barra, then 18, began working for GM while studying at the General Motors Institute, now Kettering University.
Defusing Volt's bad publicity
Akerson has leaned on Barra to help defuse perhaps the biggest PR problem GM has faced since it emerged from bankruptcy in July 2009: negative publicity stemming from fires that have occurred in Chevrolet Volt battery packs following government test crashes.
The National Highway Traffic Safety Administration is investigating the fire risk of the plug-in hybrid's battery pack after three packs ignited between one to three weeks after NHTSA test crashes.
Last week, GM announced a voluntary fix for the Volt that includes reinforcing the battery with steel to protect against punctures that could lead to coolant leaks inside the pack. NHTSA has said the investigation remains open but that the fix appears to eliminate the risk.
During her speech, Barra, who has been the face of GM's response to the potential crisis, called GM's handling of the problem "an unprecedented response by today's GM."
You can reach Mike Colias at mcolias@crain.com.
