In October the UAW agreed to have hourly retirees pay an annual health care deductible of as much as $752. Active workers also gave up a scheduled pay increase of $1 an hour. The result: A $3 billion pretax savings.
And in February GM said it would cap its contribution to salaried retirees' health care costs at 2006 levels. Future health care liabilities will be cut by $4.8 billion, and savings in annual administrative costs will total about $900 million before tax.
Grade: A. Getting the UAW to budge? Priceless.
Last November GM announced plans to cut 30,000 manufacturing jobs. Last week the company explained how that will happen. GM said it will offer buyouts and early-retirement packages ranging from $35,000 to $140,000 to all of its 113,000 unionized workers in the United States who agree to leave the company.
GM may achieve its goal of eliminating 30,000 jobs even faster than it expected. Some analysts say it could exceed that goal. The company also plans to trim its U.S. white-collar staff by as much as 7 percent this year.
Grade: A. In fact, he may have overachieved.
Cut production capacity
In November GM announced plans to close nine North American assembly, stamping and powertrain plants and three parts distribution sites by the end of 2008. The shutdowns, which include four assembly plants, will eliminate 1 million units of capacity.
Current production capacity is 5 million units, but that will drop to 4.2 million units by early 2008. That would be a 30 percent decline since 2002.
Grade: B-. Wagoner is improving the capacity use at his assembly plants, but it's a moving target. GM's market share continues to fall.
Raise retail sales
Wagoner has to kick-start sales - and he has to do it fast. Market share plunged last year, forcing GM to go on a fleet sales binge after it ended its summer blowout sale.
GM's retail sales rose 1 percent in February compared with the same month a year earlier. The increase is small, but the trend is encouraging. Fleet sales declined 11 percent, which explained some of the 2.7 percent dip in GM's February sales.
The market share crisis is real, and it's getting worse. GM has to connect with new customers. It can't simply cost-cut its way to prosperity.
Grade: D+. The February retail/rental mix was promising, but this is where Wagoner really needs to knuckle down.
Total spending on spiffs is down, says Edmunds.com. Incentives averaged $2,638 per vehicle in February, down from $3,420 in February 2005.
So far this year, incentive spending is down $1,000 per vehicle compared with a year ago, a GM spokesman says.
Wagoner's earlier push to preserve market share at any cost is the main cause of GM's present misery, say GM insiders. Wagoner is trying to fix that.
Grade: B. Shows willingness to learn.
Avoid a Delphi strike
Last week's early-retirement deal has reduced the threat of a walkout at Delphi, but the situation remains perilous. The UAW has not yet accepted Delphi boss Steve Miller's demands for big wage cuts for Delphi's 24,000 UAW workers.
But the deal should make it easier for Delphi to negotiate a new contract. GM will pay 13,000 Delphi workers up to $35,000 apiece to retire. In addition, up to 5,000 Delphi workers could return to GM.
Grade: B. The deal could still blow up, but prospects have improved.
Launch the SUVs smoothly
So far, so good for the new GMT900 line of full-sized SUVs. The launch of the Chevrolet Tahoe, GMC Yukon and Cadillac Escalade has gone flawlessly - no small achievement, since the launch was pulled ahead several months.
And buyers are responding. According to the Power Information Network, the new Tahoe's average transaction price in February was $41,233, up from $34,546 for the previous Tahoe in February 2005.
Grade: Incomplete, but looking good.
Boost transaction prices
The new Tahoe helps get that done. According to the Power Information Network, GM's sales-weighted average sale price in February was $28,070, up from $27,423 in the same month last year.
Meanwhile, GM is trying to squeeze more revenue out of each sale. For example, it is capping production of the Chevrolet Impala at 250,000 units for sale in the United States and Canada this year, sacrificing about 60,000 sales of its best-selling car to hold down incentives. It also is emphasizing higher trim levels.
Grade: B+. Last year's lousy mix was as big a problem as GM's loss of market share. Wagoner understands that.
You may e-mail Jamie LaReau at [email protected]