General Motors Company (GM) Earnings Call Transcript & Summary

Good afternoon. Welcome, everyone. I'm Jim Quick. I'm the Plant Executive Director here at Detroit-Hamtramck Assembly Center, Factory ZERO. Before we get started -- yes. Before we get started, I'd like to bring safety to the forefront for us. So we're not expecting any weather today, but in the event that we do have weather, we need to take shelter, we'll head back down the aisle that most all of you walked up and we'll get to the take shelter area, which is our locker rooms. If we do need to evacuate, we will head in the same direction and then meet at the rally point, and I'll make sure that everyone is safe in the event of those 2 things happening. I also want to thank everyone in advance for abiding by our COVID protocols. I'm proud to say that Factory ZERO was one of the first plants to implement General Motors' fantastic COVID protocols that have kept everyone safe and has kept our fabulous project on time. I also want to recognize and just remind everyone that this is very much an active construction site. The high-vis vests and the helmets, in addition to the masks and the glasses are required outside of this area. People have done a great job of putting this event area together for us today. It's safe, and I would ask if you feel comfortable, you can remove your helmet and remove your high-vis vest in this area only. Please keep your mask on, abide by the protocols. We've laid out the social distancing marks on the floor, and please keep your safety glasses on as well. Thank you. Now let's get to the show. On behalf of the entire Factory ZERO team, I want to thank and welcome some very distinguished guests here today: first, Terry Dittes, UAW International Vice President, General Motors Department; Governor Gretchen Whitmer; my first time meeting her and it was my pleasure, U.S. Senator Debbie Stabenow of Michigan; and becoming a great friend to Factory ZERO and was instrumental in partnering with us on the first COVID-19 vaccination clinic for General Motors, our own Detroit Mayor Mike Duggan. Thank you, mayor. We also welcome representatives here from the Office of Senator Gary Peters and the office of Congresswoman Rashida Tlaib. And I want to give a special welcome to some senior leaders from General Motors here. Without their trust, without their support, without their leadership, none of this would be possible. General Motors President, Mark Reuss; General Motors Executive Vice President of Global Manufacturing, Gerald Johnson; and Vice President, General Motors North America Labor Relations, Doneen McDowell. So we've got some really exciting news to share today. We just got done taking a lot of our guests here on a tour of the facility and gave them a glimpse of what's been going on and the progress that's been made. I want to recognize the entire Factory ZERO team that's been living this every day since the end of February 2020 to make this possible. We would not be standing here without you either. Your engagement, your expertise, your innovation, your willingness to not look at things for what they are, but to see what's possible, your willingness to take a look and recognize the vision that we have for an all-electric future and making this transformation a reality, I thank you. General Motors recently came out with a new tagline, which is fantastic, Everybody In. I continue to say that Factory ZERO was everybody in before it became popular. Thank you for that. With that, now I want to welcome to the stage, GM President Mark Reuss to share some exciting news about Factory ZERO and the next steps in GM's all-electric future. Mark?

Thank you, Jim, and good afternoon, everybody. Welcome to Factory ZERO. Thanks for joining us today to all of our guests and especially the team that is doing this transformation here. It's hard to believe that only 14 months ago, in January 2020, I stood here and announced an investment of $2.2 billion in this facility for a new generation of electric pickup trucks and SUVs and other EVs. It feels like 14 years ago. I'm not going to recount the horrific events that make it feel that way. We'll just say 2020 happened. But one thing that stayed the course during that unprecedented year was our unwavering commitment to an all-electric future. We've had a cadence of reveals, events and announcements in recent months that demonstrate exactly that, including in October, when we officially changed the name of this facility to Factory ZERO to illustrate it's all-electric production, and in fact, someone asked who came up with that name. I think it was Senator Stabenow, she loved the name, and I said, none other than the plant manager Jim Quick. So it came from right -- it was very organic and it was very cool. So thank you, Jim. I got to say, I'm so proud and amazed that the work being done to revamp this plant. We're essentially creating a brand-new factory of the future inside the walls that have stood for nearly 4 decades. And I'm proud to say I was an employee here. My supervisor, our CEO and Chairman, Mary Barra, was actually the plant manager here as well. So we've got a long history here. It's incredible to drive through it today. So much work, so much dedication and resilience over the last year. When we're done, and the plant is fully up and running, we'll have a team of 22 people on the job here plus the supplier communities that supply all of the material coming into the plants. Including in our other facilities in Michigan and elsewhere, we have made substantial investments in EVs in America and in American jobs. These investments demonstrate that we're committed to changing the world right now. We're taking the bold steps necessary right now toward an all-electric future to support our vision of zero crashes, zero emissions and zero congestion. We will spend more than $27 billion through 2025, including $7 billion this year alone in the design and manufacture of EVs, and we'll launch 30 electric vehicles in that time frame. Some of them will be assembled right here at Factory ZERO. And for that, I'd like to thank the great State of Michigan as well as Wayne County and the Cities of Detroit and Hamtramck. We couldn't do this without your support and the support of our GM UAW International and Local 22. So thank you, guys, for all that support. Very proud of it. Today, I'm pleased to announce that in addition to the Cruise Origin AV autonomous vehicle and the GMC HUMMER EV pickup, Factory ZERO will also assemble the GMC HUMMER EV SUV, which we just revealed the last few days. Just as with the HUMMER EV pickup, the goal of the new HUMMER EV SUV, which we just unveiled, like I said, over the weekend here, was to make a super truck that's the most capable factory off-road truck ever. And that's a big statement. But we'll back it up. Also like the pickup, the SUV is instantly recognizable as the HUMMER EV, capable of forging almost any path off-road while at the same time, ready to take on urban streets all in near silence. It's a combination unlike anything else. But that's not all the news that we have today. There's one more thing to share with you. We're excited to announce that the forthcoming first-ever Chevrolet Silverado electric pickup will also be produced right here at Factory ZERO. It's pretty awesome. Very, very exciting. So this all new full-size pickup is designed from the ground up as an electric truck, harnessing the best of our LTM technology and the proven capability of our current production, Silverado. Silverado will go all-electric with a GM estimated range of more than 400 miles on a full charge. Retail and fleet versions of the Silverado electric pickup will offer customers a variety of innovative options and configurations. I'm particularly excited about its potential in the fleet and commercial space, a crucial part of the EV market, especially initially. We have models designed specifically for fleet and commercial truck customers that I know they're going to love. This announcement affirms Chevrolet's commitment to build on 100 years of truck expertise and leadership while transitioning to an all-electric future in the light vehicle space. We'll share more on this in the months to come. But rest assured, the Silverado electric pickup will be packed with the kind of innovative features our loyal truck customers have come to expect from us and some innovations that you can't even imagine yet. Last year, at our announcement here, we said the electric future is now. And then for everyone around the world, life was interrupted. Today's announcements are a credit to our teams who worked full speed ahead through a very difficult year to make sure that, that future is indeed right now. This move to EVs as well as to autonomous vehicles is a fundamental shift in personal transportation. And because of those teams and our people, GM will lead the way. It is our people. I am truly grateful and excited that this facility, which has built more than 4 million vehicles since 1985, will help lead us into that future of transportation. So I want to thank you again for your time today, and I want to thank the teams and their resilience and their innovation to bring the products and this plant to life very shortly. So thank you very much. And Jim, I'll turn it back over to you.

Thank you, Mark. All of us here at Factory ZERO know how much moments matter. And what a great moment you've shared with all of us. And it's our pleasure to -- and really are thrilled to continue the opportunity to build GM's vision and be the flagship of all-electric vehicles here, right here at Factory ZERO. Next, I'm pleased to introduce Factory ZERO UAW Local 22 Chairman Mike Plater.

Good afternoon. Good afternoon, Local 22. Good afternoon, Factory ZERO. First, I'd like to acknowledge UAW leadership here today. Region 1 Director Frank Stuglin; Region 1 service and rep Ronda Mauer; top administrative assistant to Terry Dittes, Bryan Czape; International service and rep Dwayne Hawkins. I'd like to thank the membership of Local 22, the members that are here today, the ones that are away, for your resilience and dedication through this process to keep this plant open and to build the new products that we're going to build here. It is the future, and we're going to be part of it, UAW Local 22. Now it's my pleasure to introduce to you, and his reputation precedes him with integrity, leadership, honesty, and he paved the way through 2019 bargaining to make this happen. I watched him at the table, learned a lot from him at the table, and his dedication to the membership is unfounding. It is my pleasure to introduce you Vice President of the General Motors Department, Terry Dittes.

Good afternoon, everybody. This is a great day. This is a great day for the city. This is a great day for our membership. And clearly, we have a lot of guests here, special guests. We have the governor, the senators, the mayors, my good friend, Frank Stuglin, Director of Region 1. But more importantly, the most important individuals in this whole process is those in the back, the members of Local 22. Thank you. We appreciate you. You are the ones that do the work. You are the ones that know the product, you are the ones that are loyal to those products. And we and the UAW never take that for granted when it comes to our membership. This is a great day. As Mark Reuss said, on February 4, 1985, the first vehicle rolled off the line here was a Cadillac Eldorado. And that time period, when that first Eldorado came off the line, the transition was very rough here. The community was up in an uproar and ultimately, to build this plant, it took eminent domain. So there was a lot of suffering with this community, for this community to build this plant in the '80s. And as you know, in recent history, November 26, 2018, we were worried about the fate of this facility because it was announced it would no longer be in operation. But you're also aware that the General Motors and UAW, we've gotten a pretty good fight about that. And the details of those negotiations from 2019 were well documented here in the Detroit area. But that's what makes it even more special, because you are now going to receive more product. And those people that are scattered out in other GM locations, they'll be back onto this house. And if all goes well, we should be hiring people after we recall everyone. So that's a good thing for the city. That's a good thing for our members and their families. General Motors has evolved as the leader in building EV products right here in the United States. In the next couple of years, no one will build more models of EVs than General Motors. There is obviously a commitment of the capital for that and we in the UAW couldn't be happier. That is jobs for our members. That is good for the community and for our families. It's always a good day when General Motors tells us there's more product coming into our locations because that's more jobs. And we are very happy with that. This community, the City of Detroit, the City of Hamtramck, but this does not end here today. As you know, EVs are only 2% of vehicle sales. So there's a lot riding on these beautiful products sitting right here, and it's the fate of the membership that's on the line. But there are many things that are needed. And unfortunately, some of those things reach beyond these walls. President Biden has an American Jobs Plan right now that he has addressed. And as a part of that, there is $174 billion for EVs, for incentives to buy EVs and for charging stations across the country. Now of course, General Motors is going to partner with other companies, as is all the rest of the auto companies, but that's a big haul to make sure that there's chargers. And let's face it, the federal government has the leeway to provide incentives for American public to buy these beautiful products made right here in the U.S.A. by UAW Local 22 members. But that $174 billion for EVs, it's hanging in the balance. And we need some support for that. We need this plant to operate 24/7, not only these 2 great products, but the Chevy Silverado will be here. And that will be the livelihood of this community and you and your families. Unfortunately, Washington partisan politics has got in the way in some of that. But I hope that some of those in one respective party will choose workers over their own party. They will choose America over their own party and do what's right and help us provide jobs and an infrastructure so this plant can be thriving as it should be and as it deserves to be. So this is a great day. I hope that we move forward. I hope that we get support outside of these walls, and I really appreciate the governor, the senator, the mayor for being here, and it is an honor to represent the members of UAW Local 22. Thank you very much.

Thank you, Terry. Thank you, Mike. And Mike, I continue to be proud to be on this journey with you. Together, we are changing the way that General Motors brings vehicles to market, and we're changing the culture here at Factory ZERO for the better. Now it's my honor to welcome to Factory ZERO again and to the stage, Michigan Governor Gretchen Whitmer.

All right. Thank you, Jim, Mark, the leadership at General Motors and, of course, the incredible women and men of the UAW. I'm so pleased to be here with all of you. I remember, like many of us do, that this was a plant that was maybe going to be coming off the radar. And now it is the most technologically advanced plant, maybe on the planet, right here in Hamtramck and the City of Detroit and the State of Michigan. Thanks to the work of all the people in this room, and this is an exciting moment. We are standing in the belly of the beast when it comes to the future of mobility and travel. This is a historic space, space of innovation, humming with the next generation of machinery, and powered by union men and women who will build the next chapter of an American icon. Right here is where Chevy's new electric Silverado will begin rolling off the line, and the HUMMER will continue its comeback with a fully electric vehicle. And it is exciting after an 11-year hiatus. These 2 will be joining GM's growing line of electric vehicles, a total of 4 electric vehicles: the HUMMER EV pickup, the HUMMER EV, the electric Silverado, and the electric self-driving Cruise Origin will start production in this factory soon. GM is investing $2.2 billion to convert this factory, Factory ZERO, into an all-electric plant, employing 2,200 Michiganders in good paying jobs. Every vehicle built here in Factory ZERO is going to expand on GM's decade of EV leadership and century of automotive expertise. And this factory is one of GM's plants that is dedicated to manufacturing electric vehicles. The other 2 are in Spring Hill, Tennessee and Orion, Michigan. But the one we're in, the one right here in the Motor City in Hamtramck is the launch pan -- the launch pad for GM's multibrand electric vehicle strategy. Once complete, 4.5 million square feet of possibility. For decades to come, this is going to be a site where the future is made. GM continues to lead the future of mobility through serious commitments and more importantly, through tangible actions. The EVs that will silently roll off the line here at Factory ZERO will join 30 electric vehicles available globally by 2025 and help GM achieve its goals of going all-electric by 2035 and carbon neutral by 2040. Now these are ambitious goals, but I know, I know you're up to the challenge. Investing $27 billion into electric and autonomous vehicle development, including $7 billion in this year alone. These plans are going to be boosted by the recently proposed American Jobs Plan that Terry talked about. It calls for $174 billion investment into EV market and build a national network of 500,000 chargers by 2030. I share their vision and commitment to zero crash, zero emission and zero congestion future. And we, as the State of Michigan, are committed to continuing to partner toward that mutual goal, pursuing our clean energy future here and putting hard work and people into good paying jobs. So the story of Factory ZERO is kind of the story of Michigan. Perseverance, grit, determination and a commitment to getting it done. 3 million cars have been built here, 3 million cars that would go on to be a part of people's lives. Moving our families, getting us to work, taking on life's mundane chores and going to the grocery store or getting to one of your kids' soccer games. This is a momentous occasion about the future of mobility, about the future for all of us and our kids and their kids. So as you like to say here at GM, everyone in, let's get rolling. Thank you.

Thank you, Governor Whitmer. And our door is always open to you. I appreciate you taking the time to visit us again today. Now it's my pleasure to welcome my new friend, but certainly a long time supporter of General Motors and the automotive industry, U.S. Senator Debbie Stabenow.

What a day. Isn't this cool or what? Isn't this great? And I have to say, Jim, you came up with the name Factory ZERO, and I think they had to put you on the marketing team. Mark, I think that's where he ought to go. It -- that's a fantastic name for an absolutely fantastic place. It's always wonderful to be with our great governor and to be with our wonderful mayor and to be with all of you, particularly, Local 22. Local 22, making it happen. Thank you. Thank you, Mike. And Region 1. Thank you, Frank, and Terry as Vice President, thank you for your leadership. And I just want to tell you as the lead in the United States Senate in the Finance Committee working with President Biden and those incentives he talked about, it's not if, it's when because we're going to get it done so we can support what you're doing and create good paying American jobs in Michigan. We're going to do that. We're going to get it done. So it's always great to be in a celebration with GM and the UAW and all of you. And it's always wonderful to be here celebrating Michigan's continued leadership in automotive innovation. And it's like I always say, we make things and grow things in Michigan, right? And you don't have an economy, you don't have a job unless somebody makes things and somebody grows things and adds to it. And that's what has been happening at this plant since 1985. So some of the cars were mentioned, I want to mention just a couple of more. The first vehicle here was a 1986 Cadillac Seville. It offered an optional Motorola cellphone built right into the front console arm rest. Anybody remember that? That was our cellphones. We have come a ways. Then you jump on up to 1994 Cadillac DeVille. It added heated seats, I always like that, a CD player and 16 miles per gallon in the city. And then you jump ahead to Chevy Volt, no CD player, but the 19 -- the 2019 model got the equivalent of 106 miles per gallon. And now here we are, Factory ZERO, building the all-electric HUMMER and more. I mean these are awesome, incredible vehicles. I can't wait to ride in one. It's exciting to see what GM is doing in making the investments to keep our state on the leading edge of automotive technology so that we can move forward together leading the way. Here in Michigan, you can't stay in the lead if you hang back. Michigan is not hanging back, GM is not hanging back. And today, the future begins right here. I'm so proud to be here. And more importantly, I'm proud to continue to be your partner. Thank you.

Thank you, Senator. Great meeting you today, and thank you for your ongoing support of GM and the automotive industry. We also have a special virtual guest here today, former Governor of Michigan and current U.S. Secretary of Energy, Jennifer Granholm. She cannot be here with us live today, but she took the time to share a video message with us, and I'd like to say, take it away, Secretary Granholm.

Thank you, Jim. Hello, everybody. I am thrilled to be back, albeit virtually in my beloved state, the state where I saw firsthand, the power our auto industry holds to drive America's clean energy future. So when I heard about what GM was announcing today, it took me back to this day in January 2004 at the North American International Auto Show. And there, GM, I remember this so clearly, I was with Dick Shoemaker, Shoe of the UAW, who just passed away, may he rest in peace, and CEO Rick Wagner, and we were walking around the showroom floor, and they gave me a sneak peek of the early green technologies that GM was working on. And the foresight and the intelligence and the passion that you all were pouring into those projects then was palpable. I was, at that time, seeing GM's net zero dreams begin to take shape. And I really felt hope. And since then, of course, the auto industry has persevered through some of its darkest days, but in spite of the bankruptcies and the challenges, or maybe because of the bankruptcies and the challenges, GM never lost sight of its vision. And today, that vision is clearer than ever and finally within reach with these new models and phenomenal investments in Factory ZERO. GM is putting your money where your mouth is, and that is huge. Here at the Department of Energy, we know that the electric vehicle industry holds the keys to America's clean energy future. And more than that, EVs play a monumental role in President Biden's mission to build America back better. His new American Jobs Plan is proposing $174 billion to help our nation win the EV market, and that means more money to bolster our domestic supply chains, more money to retool factories so they can compete globally, more money for a national network of chargers to help people get where they need to go. It means more support for the work that DOE has been doing for years to make EV batteries cheaper and reduce charge times. And GM has been doing the same thing. It means more jobs for the American workers who are going to bring these investments to life. And more opportunities for American communities, especially communities that have been left behind to build back better into a cleaner and greener future. And all of that means the American people will be climbing all over themselves to get their hands on an EV. Like me, I leased a Chevy Volt, my second one, after having leased 2 Volts. My Volt is the best car ever. And all the people we have behind the wheel of an EV, the closer we get to our destination, cleaner air, healthier communities, and boundless prosperity for our nation. So today, I feel hope again in Detroit and to my friends at GM, thank you for stepping up. Thank you for never losing sight of this amazing vision. And when these models are ready for a test drive, I want to be first on the list. Back to you, Jim.

Thank you, Secretary Granholm. Now it's my pleasure to welcome to the stage, Detroit Mayor Mike Duggan.

Well, I spent the morning here at Factory ZERO, and I have seen the future. What GM and the UAW are doing at this site is amazing, the expansion from 2.5 million to 3.5 million square feet, $2 billion of investment, more than 2,000 full-time workers will be here and ultimately building more than 250,000 electric vehicles a year coming off the assembly line here in Detroit. It's just inspirational. And I can't help but think when I think about the partnership between Detroit and GM, right down the street on Grand Boulevard in the early 1900s, when GM was assembling itself from Oldsmobile and Cadillac and Buick, and they built their first world headquarters down the street. It opened in 1923, almost exactly 100 years ago. And in the last century, a lot of people had bailed on the City of Detroit. But General Motors never did. Their headquarters remained here for 100 years, and this partnership is one that's deeply appreciated. And Terry Dittes talked about it. When General Motors needed help, Mayor Coleman Young stepped up on this site, spent a huge amount of money and took a great deal of criticism to clear the land to build this plant. That was 1980, 40 years ago. And as I went through the plant today and saw an automotive factory that's going to be here for another 40 years, I just thought of the courage of Coleman Young and the fact that it's paying benefits to the city decades later. And to GM and the UAW, the HUMMER electric vehicles, the HUMMER SUVs and the Chevy Silverado and the Origin, for the folks who haven't seen it, this small automated vehicle with no steering wheel and no gas pedal and brake pedal, it's going to take some get used to, but that future is all being built here, which is going to ensure that the City of Detroit remains the home of the most advanced automotive manufacturing in the world. Thank you, GM and the UAW.

Thank you, Mayor. We may be Factory ZERO, but we will always be Detroit-Hamtramck, and we cherish our relationship with the communities, and we're very grateful for that relationship. Finally, it's my honor to introduce a great friend of mine and GM Executive Vice President of Global Manufacturing, Gerald Johnson.

Thanks, Jim, and good afternoon to Factory ZERO, and I'm sure a lot of you have some of the history that you've heard about as Detroit-Hamtramck, a very respectable history that's kissing and touching now a very, very aggressive future. Mike Plater and Jim Quick, thanks for allowing us in your house today. Thanks for all that you've done to get us to this point. And it's my job to wrap this up so you guys can finish the work that you have yet to get done. I'm going to thank all of you for joining us. I will be brief before setting you on your way. But I want to reiterate the significance of our announcement today, along with bringing us that much closer to GM's vision of an all-electric future, which promises a brighter, cleaner world for generations to come. The new products we'll build right here at Factory ZERO affirm GM's commitment to manufacturing. On my right is an affirmation. On my left is an affirmation, and the Silverado to come is a punctuation. It's our competitive advantage, manufacturing is. Indeed, EVs and autonomous vehicles represent a brave new world in mobility, and they bring all new challenges to the already complex world of manufacturing. But at this historic moment for the industry, there's no company so uniquely positioned to succeed as General Motors. And here at Factory ZERO, our team is literally building the future. They're in one of the greatest technological revolutions since the birth of the auto industry itself more than 100 years ago, and I got 40 of those years in me. It's an unprecedented shift, one that we are committed to making with the contributions from our manufacturing team more crucial now than ever. Proud to say that we've adapted. We've thrived and we succeeded as a team. The team leaders, group leaders, tradesmen, electricians, machine repairmen, drivers, inspectors, engineers, material drivers, the quality team and all, the community at large, as Mayor Duggan just talked about, takes all of us as one team to get something monumental as this done, and the work is not over, it's only beginning. Our roles may change. The technology might dictate that. The future and adaptations that we've had in the past and that we'll have to do in the future as well may dictate that, but our responsibilities and our mission won't change. Our responsibility to the customers to build it and build it right, our responsibility to our future to build a future of zero crashes, zero emissions and zero congestion. And you have all that here in the products that we've announced, including the Origin. To put it directly, there's nothing our team and General Motors manufacturing and then the UAW can't build. Thank you for being a part of this great day for General Motors. Thank you for being a part of this great future. Thank you for being a part of zero, zero, zero. You matter. It makes a difference, and I thank you for all that you're doing and all that you're going to do. Have a great day.