General Motors Company (GM) Earnings Call Transcript & Summary

All right. Good afternoon, everybody. Thank you for joining us for our next session. I'm Itay Michaeli, Citi's U.S. auto and mobility analyst. I'm delighted to have our next guest from General Motors back with us at the Citi conference for a fireside chat discussion. A couple of quick housekeeping items before we kick it off. One, to ask questions for folks in the room, please use the QR code on the table. And two, we do have legal disclosures if you do require those. So with that, we're delighted to have from General Motors, Steve Carlisle, Executive Vice President and President of North America. Steve, great to see you. Thank you so much for being here. We'll get into a fireside chat shortly. But before we kick it off, I'll just hand it to Steve, I think, for a few opening remarks, then we will go ahead and begin. So Steve, welcome, and thank you again for joining us.

All right. Thanks, Itay. I'm very glad to be here and looking forward to the discussion. But as you say, maybe before we get to that, I'd take a few minutes to share some thoughts. And I'll focus on our retail model and how we've been working with our dealers and the capabilities as we roll out our EV portfolio, which we've talked quite a lot about. So it's been more than 2 years now we've been working to formulate a future vision here in terms of -- and a strategy for enhancing our retail distribution model with a clear emphasis on the EV customer experience and the business model. So to do that, we've looked closely at our distribution system and benchmarked other leading modern retailers. And I hasten to emphasize that, that's retailers in our space, but also outside of our space. So our goal has been to look at the best of the best and integrate those into the process. So we've done that in collaboration with what we call our Dealer Executive Board. So these are key dealers from all the channels and work with them to develop a plan, which we're now in the midst of rolling out. And there's really 3 goals or 3 elements to that. And the first one, importantly, is to enhance our customer experience throughout the whole value chain. Our aspiration is to get to an omnichannel experience for the customer that would span vehicle sales, ownership, servicing, other value-added products and services with the customer at the center. And then so doing to deliver superior economics for ourselves and for our dealers, and we do that by driving out cost and complexity. And then the third pillar would be to accelerate innovation through e-commerce and some aspects of our business process, for instance, in terms of how we manage vehicle inventory, which has been very topical here over the last 12 to 24 months given the macro situation that we've been operating it. So then that plan that I've referenced fully embraces change for a new era by consolidating investment and activities, for instance, in new digital and physical capabilities that will harness our strengths and our scale across the broad network coast to coast, across the country. underpinning that strategy, as you might infer, is our firm belief that our dealers are an untapped asset in the race for EV leadership, and in that regard, a competitive advantage for us. So at GM, we're focused on harnessing those strengths of our dealer network, the facilities, the people, the entrepreneurship and the active participation in their local communities. So by year-end this year, 2022, we anticipate that a substantial amount of EV sales volume will flow through that platform that we call our Digital Retail Platform, which we're also rolling out with our used car platform that we're calling CarBravo. So Itay, I can leave it there and turn it back to you into the Q&A.

Yes, terrific. Thanks so much, Steve, for that. And we definitely want to cover these topics, really, really important in the discussion. And again, feel free those here to take your questions in as well. Maybe to kick it off, the question every company is getting here in the conference, the first question, for sure, is just any update on supply-demand conditions, semi-related and of course, any comments on the situation, EV -- Ukraine and exposures there?

Yes. Well, there's an update every day on chips. I'm sure you're picking up on that theme. It is a dynamic situation. But I'd say, generally, as compared to the environment that we were in last year, we're more optimistic. We're seeing better coverage of our production schedules through the course of this year and certainly better than what we experienced last year. We're seeing good coverage in the third quarter -- or first quarter, maybe a little bit of softness in the early part of the second quarter, but a pretty significant improvement beyond that. And as a couple of points here, we're doing pretty well with getting more inventory into our product pipeline and making decent progress here from a market share point of view. We have all of our factories back on normal operating plans as of now and foresee that we can keep it that way for as long as we can see over the horizon. Certainly, you can expect other events along the way, ones that we haven't anticipated yet. But again, working with our dealer partners and across the enterprise in the company, we've adopted, I think, a lot of really good practices that have served us well. And there are a lot that will be carried forward into -- regardless of what happens with chips in terms of faster inventory turns and more focused offerings and things like that. On the Russia-Ukraine situation, we're looking at that closely. And we look at that a couple of ways, as a source of raw material that's been written about quite a bit. Our exposure there, we do have some, but at a level that we can mitigate. In terms of components, virtually no exposure there. And then in terms of selling into the local market, we have a small presence in Russia, but nothing that I would say is material. Of course, we hope it resolves because of -- I think we all have to be concerned about the impact at a macro level with a situation like that. But in terms of direct impact, I'd say that our exposure is pretty limited.

Great. I appreciate that update, Steve. So maybe we could pivot to some EV topics. Obviously, a huge part of the discussion, you alluded to already in distribution and DRP. I wanted to start off with the steps that General Motors is taking this year and next year to increase EV capacity. There's been some new headlines recently about steps you're taking to do even more this year. Maybe talk about some of the opportunities and constraints that you're facing in this regard.

Yes. Well, the steps that we're taking is that we're in the launch process in several areas. So we started release of the HUMMER EV out of our Factory ZERO in Detroit at the end of the year last year. So we're in the acceleration phase there with the HUMMER. The LYRIQ, we'll get our start of production year later on in March and shift to commerce to consumers on the 2nd of May. The Bolt and the Bolt EUV will start production on April 4. So from a rollout point of view, all that's underway. We've announced several projects. We talked about Factory ZERO before in Spring Hill. Lake Orion was the most recent one. So those projects are underway to begin installing capacity for assembly, but also importantly for battery cells and battery packs. So we have the project that will be coming into production in Ohio here a little bit later in the year, Spring Hill in Tennessee next year. And then the Lake Orion one towards the end of 2024. And we plan to make another announcement sometime in the first half of another one. So we're putting all those into place, and that's to support launches that we can foresee. We've done some reveals recently. We revealed the Silverado EV and have been taking reservations on that one. We -- I'd say, pre-revealed the Equinox EV, so that we'll be making more news about that here as we go through the course of the year as well as a Blazer EV. So it's really across all those fronts. And I'd say in the background also, our Ultium battery technology, we're launching with the first generation of that, but we have some life cycle enhancements for those in the works that we'll launch over the course of the next 2, 3 or 4 years. And that's to keep us on the cost curve, the cost reduction curve as well as the range, charge -- density charge time curve that I'll go with this transformation towards EV future.

Absolutely. That's very helpful. And then you mentioned the Silverado EV, the reception there. Any update you can share on reservation, just overall impact certainly at post Super Bowl? I'd love to kind of hear any updates you have there, including the composition of some of the communications of interest that you're seeing non-GM owners versus GM owners, pickup versus non-pickup owners? I'd love to get any insights you have there?

Yes. I mean really encouraged by that. So we have, on the HUMMER, about 60,000 reservations. Of course, we're starting to fulfill those, convert them to orders. The number that we quoted at the time of -- the number that we quoted on Silverado EV is around 110,000, so that's about 80,000. We've done an extensive with 240 of our fleet commercial customers, 240 face-to-face consultations on that. So we've got a good order bank there, if you will. We've had 30,000 that are more retail-oriented. That was at a point in time. And then as you referenced, we really started to see a tick-up based on the ad that we put into the Super Bowl, which, by the way, we got a lot of positive feedback on. So I don't have an updated number for you right there, but I'd say we're on track with where we think we need to get to. Likewise, with LYRIQ, a good reservation bank there. In fact, based on the reception that we've seen to the LYRIQ, our plan is to -- when we get to that shift to commerce time frame in May to just switch that on to regular production orders and accelerate what we had planned to do. In terms of the composition, also a very encouraging story in that when we look into that, we segment that into Conquest to non-Conquest. I'd say, in general, across all those products that I talked about, we're about 60% Conquest of one shape or another. And within that, there are Conquest to the brand itself, to GM, there are win backs and the like of that, but very encouraged by the level of Conquest activity for us. So that's, I think, a positive indicator of 2 things. One, the -- where we're getting to on the EV adoption curve, but then the opportunity to expand the opportunity for GM. We also look at it geographically, and we're encouraged by that. So some parts of the country where today, you could argue and we would admit we're underrepresented, are we under-indexed, we're overindexing in those areas. Think of California and Northeast and Florida and states like that, we're seeing a very positive uptick in those reservation in the early ordering. So really excited by that.

Absolutely. I got to ask, Steve, what were the impressions you showed, I think, a few -- you haven't unveiled the Equinox EV, I think, officially yet, but there are a number of pictures that you released at CES. What some of the data points, impressions you're seeing there on the Equinox?

Well, positive. A lot of -- it's one of those when we look at the entire market and we look at the big segments, large pickups are a big segment. Compact crossovers, where this product, the 2 products that we talked about will compete. It's actually the largest segment in the market. So very -- a lot of interest in it. And I'd say those fleet commercial customers that I mentioned, a lot of interest from them. We've been a little more revealing with them in terms of the details and everything like that. So very encouraged by that. And the market research that we've done, the products have clinic really well. And there's 2 things I'd point out about the clinic, and this applies to that one, but -- or the research in general, applies to that one, but also other ones like Silverado EV is first, the willingness to consider an EV for your next purchase. That's something we ask typically. That number is getting very high. In some clinics, we can see over 50% of consumers are saying they're willing to consider an EV as their next purchase. And that number is up substantially over the last 2 or 3 years. So there's that. And then we look at the EV product in the same clinic setting as their ICE counterparts and other EV counterparts, and we're seeing, for the most part, we're coming out as first choice in those clinics. So -- and that's true of the Equinox EV. So yes, that -- we're really looking forward to that one as well, which is why that one is kind of the next one in the queue here towards the end of the first half.

That's great. And so we talked about product and capacity. And when we step back and think about the EV story for GM, one of the key questions we get from investors in the multiyear horizon is, are EVs just sort of a transition you have to do just to kind of survive or are they truly a source of growth? And when I look at the company's disclosures and particularly what I call the GM non-truck franchise, I think pre-COVID, prestrike as well, it was a majority of your volume about 2.1 million wholesales, if I remember correctly. It seems like there's 2 growth opportunities. One you alluded to for the company and particularly for the non-truck franchise, one, the coastal market share, particularly in California. But two, also to attain a higher ATP as well as a higher variable profit per unit. I was hoping you'd talk to these opportunities and broadly how much do you look at the EV launches as a true source of profitable growth for certain large parts of GM North America that may be arguably or factually underearned during the internal combustion era?

Yes. So you pointed out the geographic one, first of all. So I think that's an enormous -- it just -- it coincides with where we've tended to under-index for a number of years. They're high propensity for EVs in those markets today. And as I've indicated here, when we've done all the research, talk with our dealers, we see an opportunity to actually over-index in those areas. So that's certainly plus volume for us. And then as I refer to the Conquest just in general, people that haven't considered us or did and we lost to bring them back into the family, those are big opportunities that we see from a growth point of view in terms of unit volume. The other things that I would point out here -- the other aspects that I would point out is we talk a lot about electrification, but the connectivity part of this, the whole software part of this is a completely other dimension that we weren't talking about much 2, 3, 5 years ago during that era that you talked about. Save an example, that's been extremely successful, which was -- which has been OnStar. So we've talked about Ultium as our electric vehicle platform. We talk about Ultifi as our software platform. And so you can think of businesses like OnStar, we have a multitude of other ones like that, that we're bringing to market that from a point of view of a life cycle purchase opens up a whole other stream of revenue and growth for us. So this whole electrifying, being connected, smart software platform solutions is opening up sources of value that just didn't exist in that time frame. And then a lot of it is tech forward and very innovative, allowing ourselves to put ourselves back on the front foot. Super Cruise is a great example of that, right, where I think generally acknowledged as the best solution of its type in the market. So we have that. We're deploying that just about everywhere we can think of. So there's that in and of itself. But then also the ability to update it as the -- as you own the car. And we're doing that today where if you have a '21 model year Super Cruise equipped vehicle, we can update it and give you capabilities that you didn't have when you bought a car because we didn't have them then, right? So there's a lot of incremental growth conquest opportunity with EVs per se, but then also revenue and profit opportunities from these other adjacent revenue streams.

Absolutely, it's a great point. I definitely want to dive into a little bit more because when we look at automakers today, we think about your addressable market often as just SAAR times share and the ASP of the vehicle. But in reality, you're true addressable market with a clean sheet of paper is the lifetime revenue that a vehicle generates...

Yes. For the car park, for the car park.

Absolutely. And by our estimation, I think you're only -- the industry is only maybe getting 40% or less of that lifetime revenue, maybe less so on gross profit dollars. You talked a lot about this at the Investor Day back in October. I was actually having a discussion with an investor about this earlier today about some of the opportunities and the surveys that the GM did, and I think it was at $135 per month of willingness to pay broadly for services. Maybe just give us an update of where you are there? Kind of what are the things that are most exciting when you think about Ultifi broadly in the next few years and also maybe how you plan on rolling that out, how many of these features will we see on some of your new EVs on Ultium and some of the other new products that you'll be launching as well.

Yes. Yes. So for sure, and that's the software developed platform that it was -- software developed vehicle as to what I was referring to there. So an OnStar is kind of the arc type example of safety, security, connectivity. Super Cruise is another one where -- I'll just build on that a little bit as we started that on in a fairly limited number of vehicles on the Cadillac CT6 a few years ago. And we're in the process of rolling that out across 22 or so vehicles here in the next couple of years. And then our intention is it will be on every EV that we produce as well as several other ICE vehicles. So I put that one in this context because there's 2 parts to Super Cruise. It takes data to operate, okay? We have the data pipe through OnStar, which is now 4G headed for 5G across the board. But then it's what brings the over-the-air capability as well. So whatever we can do, if we're updating a feature like Super Cruise, we can do that over the year on a pay-for basis on a backcasting type of a scenario. So we have that. But you may have noticed all the displays that we're putting in the vehicles as well, right? Like in the Cadillac today, we've got the OLED, the 38-inch screen and what we call the VCS screens going into all the EVs and they're the same kind of free-form format, 36 inches or so on the diagonal. But that allows us to bring a lot of data, software-oriented products to the driver and to the passenger. And so we have in the queue 50-some such value-added products and services that we'll be rolling out over the next, let's say, 36 to 48 months. So not all in the magnitude of an OnStar, you can think of that as a $30 or so a month sort of an undertaking, but anything kind of up to that, right? So that's what we're doing. We brought in a gentleman called Edward Kummer to head up our digital business team. And so he's hard at work bringing all those into a commercial state and they'll start rolling out with a LYRIQ when we get the software developed platform into production. And we have other versions of that, like I say, with Super Cruise and the updates that we're doing there. You can do just whatever you want. With the displays, a simple example, maybe would pay a lot for it, but if you wanted to update the skins on your screen like you do in your phone, you can do that. If you want to change the -- all the lighting is interconnected in the vehicle, if you wanted to change the colors or the choreography with the lighting, you can do that. There's just about any form of navigation or reservation that you can imagine. I think I have -- one that people get really excited about is maintenance, right? So we're now tied into every vehicle subsystem and have an incredible capability to do what we call prognostic. So we can do predictive. This subsystem looks like it might have a problem. You should go see your dealer or request an over-the-air update. And people like that a lot better than relying on holding an air filter up to the light, is it dirty or not. So Itay, there's just a whole range of things that we just can imagine but are really excited about. But that's how you get to $135 a month that you start with. I've got a $30 one now or a $32 one on OnStar, what other ones can I come up with that are like that? A lot of them have shared that they rely a lot on data. We have a data pipe that's getting better and better. And it's the connectivity with the vehicle and the environment around it. Charging is another one that's of huge interest to people. So of course, we're in touch with the condition of the battery at all times through the car and through your mobile app. We're building out the charging infrastructure. So from a route planning point of view or a journey planning point of view, that's all there as well. And that's critically important as part of the adoption process and eliminating all those barriers.

Absolutely. You mentioned Super Cruise, we totally agree that I think one of the biggest opportunities here that makes the most sense all around is the L2+. And certainly, I know you're going to launch Ultra Cruise. I think it's on the LYRIQ as well. But one of the questions that comes up with features like Super Cruise and Ultra Cruise, where maybe the model is shifting to some extent on relying on subscription to lifetime revenue, which certainly we all agree, it could be a significant opportunity for revenue and margin expansion, but at some level, it could require you to increase the attach rate significantly. And maybe even -- yes, maybe the 80%, 100% in theory to truly capture all that opportunity in the data, which at some level might risk not capturing all the return on that content investments right away when you sell the vehicle. And I guess the question is, how much appetite do you have for increasing attach rates of whether it's Super Cruise, Ultra Cruise or even other technologies if the return profile may become after the sale of the vehicle? And could we see GM starting to go to really high attach rate in some of these technologies?

Yes. Well, that's certainly the idea. And what gives us confidence? So I'll go back to our CT6. It's a case where -- and there's 2 dimensions to that. One is that when people use it, their feedback is 95% of them, I won't buy another car without it kind of thing. So they get kind of in love with it. And then what we did with the CT6 is, because that's the one we have the longest experience with, you start with a free trial period. And then when you exit the free trial period, that's when you make the decision, do I want to continue with it and take the data package that would support that. And we saw a very high response rate to that. So that gave us the confidence that if we can put the hardware in the vehicle and create a trial period and get the customer, get the user experience with it, fall in love with it, then when it comes time to re-up, then that's a much easier situation. Certainly, there's some leakage, right? But I think we're also anticipating that there'll be a lot of people. It's just one of those features that you just -- you fall in love with and provided we don't get too crazy with the subscription package to support that, that we can anticipate that the re-up rate will be high. And we've seen that with OnStar, for instance. We used to say back in the day that what you really wanted to do is to get somebody to press that blue button just one time and then you're a customer for life. Super Cruise is a little like that, press that button just one time, and once you get over that initial period of not holding on to the wheel, you get used to it really quickly. And I've done that -- well, I'm obviously not -- I've got a point of view on it. But for me, it's very difficult to move from a vehicle with it to one without it now, right? I think it's one of those ones. So -- and we have flexibility on how we would ask the customer to pay, like there's a certain component that would be in the initial purchase price. The service itself, it could be a monthly subscription. It could be a onetime buy over a 36-month lease. It could be annual. So -- and we're learning a lot. We have learned a lot through OnStar, for instance, in terms of how people prefer to pay. The other great advantage that we have is we see the customer more than just at the point of sale, at the point of purchase. We're seeing them in the service lane. We've got an ongoing relationship with them. So we have, with all these services, the opportunity to sell during the life cycle. So your car can only get better as you own it, which is kind of the newer paradigm. But the short answer to your question is we're going to drive attach rates to the greatest extent possible. Yes. The other thing that we're seeing is it's one of those technologies where it started out at a certain cost. All the automated driving technology, they start out at a certain cost. If you think of all the cameras and radars and sensors and microprocessors and all that. The cost of that is coming down pretty dramatically just because we're getting better at it. It's a typical technology adoption curve, but also building the scale under it as well. So it's not a bad thing to have a head start on that. And then as you alluded to Ultra Cruise, if we -- we'll continue to expand the use cases up to 95% of everything that you want to do, you can do with Ultra Cruise, provided you've got driver supervision, that's pretty powerful. And it's something people are willing to pay for. They've demonstrated it already. I'd say with all the chip crisis situation that we've been through, you face some hard choices, like, do I want to build and escalate with Super Cruise or without? And the answer is you build it with it, just to be clear. But the reason is it's hard to sell one without it now, right? It's just -- it's become the thing to have. So we're big fans of Super Cruise.

Absolutely.

I am, anyway.

Yes, absolutely. We've got to use it, I think, at the Investor Day as well and also excited about Ultra Cruise, too. Steve, in your opening remarks, you talked about the dealer model and CarBravo. I want to kind of come back to that and also talk about how the future dealer model and the world of dealers broadly fits through all these lifetime revenue initiatives that we're talking about as well as CarBravo as well in that. Maybe just talk about -- we talked about the EV transition a little bit but maybe into the lifetime revenue, service subscription and the role there.

Yes. Well, I'll start with CarBravo because I think it's a good example. In a lot of ways, I think it helps to demonstrate or understand what we're up to in terms of the retail transformation overall. So the idea behind CarBravo is our used car -- we sell a lot of used cars today through our network, about 2.5 million a year of used cars. We have a lot of used car inventory. We have about 500,000 units of inventory at any moment in time throughout our system. The challenge is, from a consumer point of view, it's pretty disaggregated, right? It's at a dealer level, it's in depots and everything like that. So the idea of CarBravo is to create an omnichannel shopping experience where the consumer has access to as much of the inventory as they want to look at. And then they can find their way to the dealer from a transaction point of view. And an advantage, I think we have, we have access. We have let's say, preferred access to the used cars. If they're coming off lease through our dealer network, through GMF, if they're coming off rent, we have preferred access to those used cars. And of course, dealers are taking used cars on trade. And so now we have the opportunity to make all that inventory visible to consumers, easy to access, transparent in terms of pricing, which is another key thing. So that's the basic premise. And then the idea is the consumer can do as much as they want online digitally through this omnichannel experience up to and including purchase and financing or they can do as much as they want with the dealer. And the research that we've seen is -- and this cuts against perceptions a little bit, but 71% of consumers would tell us that they prefer a mix of online and physical with the dealer experience. And they like the idea of having a service network there at their disposal. It's only about 11%, I would say that they prefer to shop exclusively online. And that trend has been flat by the way, over the last several years despite what we've seen going through COVID and so on. So it's a combination of let's have the best of the best. It's the same DRP that is the platform for CarBravo is the platform for our electric vehicles. So -- and then that gets to be the role of the dealer -- well, and then let's talk about CarBravo and the role of the dealer. It also gives us the opportunity to drive the conversation towards things like OnStar and used cars, right? So we can re-up OnStar and used cars. Down the road, we're selling a used car that has Super Cruise. We can sell a subscription to Super Cruise. We can sell accessories. About 1.5 years ago, we started an e-commerce activity to sell accessories. And it's growing at multiples. It's been very popular. And interestingly, it's bringing -- in the data that we see, it's bringing customers that we've never seen before into the dealership. A, they prefer to take delivery of the accessory and the dealer. B, they're people that we haven't seen before, right? So -- and I don't -- we've learned this from OnStar, too. The dealer channel is probably the best way that we have to sell services like this because we have that relationship. We have repeat occurrences and contacts and things like that. So the role of the dealer in all this, it's going to change a bit because the customer, we want to give them the flexibility -- and our dealers agree with this, by the way, because this is what's happening in their world and what the customer wants. They'll be coming into the dealership at various different stages in their research process, their buying process. They'll want to engage from service in a different way. They may want to schedule online. They may want to come in and schedule. So this DRP that I've talked about is capable of all of that. So then the dealer is flexible to accommodate. You want to avoid the handoffs, where you have an online experience, you come into the dealership, you start again and you start with somebody different. So we're addressing all of those pain points. And then it's more and more a sales channel or distribution channel for the software products that we've talked about. And for service, for instance, an aspiration that we have is -- and this will change in the dealer world is you should be able to -- if you can get a service experience OTA in your driveway, that may be something that you want to do, right? If that won't work or you're not interested in it, can the dealer come out to your driveway and fix it. You might like that. Or do you want to bring it in for service, right? So we need to think of all the different ways to address the traditional pain points. The good news is this DRP that I talked about allows us to address all those different use cases. So what that means to the dealer is, for instance, there's a lot of talk about -- until now dealers have made a lot of their P&L depends on the service department, and there's less services associated with an EV, how do we backfill or how do we grow? Well, we can grow by selling these other products in different ways. It's how we think about it and the kind of conversation we're involved with our dealer partners.

Absolutely. Thank you for all that detail, Steve. I want to quickly hit upon another big number that gets tossed around in the investment community that you recently shared, the North America EV volume goal of 400,000 cumulatively this year and next year. And one of the questions we get is how do you prioritize between your truck businesses, the pickups versus non-truck, both can give you some growth opportunities presumably. Are you targeting kind of a #1 EV pickup share position next year as you ramp? Just give us a little bit of insight on how you're thinking about the mix of product within that.

Yes. Well, I think the goal is to win, right? And then we can debate by when and with what. So -- and Mary, I think she laid out the 400,000 number over the next 2 years. So that's really what guides us. And then you kind of break it down, where do I go? Where is the highest propensity in terms -- and then where are the largest segments and so on. So that takes you to pickups and compact SUVs and then we've got a particular plant we want to make on luxury, which brings us to LYRIQ. So that's kind of how you get there. And then the way we think about it is trucks has been a franchise for us as you've highlighted here, will continue to be a franchise. And we've been leaders, we intend to be leaders, whether it's ICE or EV. So on the one hand, we're going to play hard on -- with products like Silverado EV and the Sierra EV. We'll reveal that a little bit later in the year. So we're going to go hard on EVs. At the same time, is, like I indicated here, about 50% of people would say they're willing to consider on their next purchase, while another 50% are not, right? So -- and then we see this Conquest opportunity on the EV side. By the way, we see a Conquest opportunity on heavy-duty pickups. And why do I raise that? Well, we're in the process of launching, literally as we speak, a really nice major change on our pickups and expanding our capacity on our heavy-duty pickup. So we're going to play hard on both of those and allow the customer to have the choice. We have flexibility in our capacity for a period of time where we can manage the sunrise and ultimately, the sunset as I refer to it, and we'll just follow where the customer goes on that. But it comes down to -- there's one thing that really counts, I think, in most ICE is that you can build and sell more. And we want to make that as simple as possible for people to understand. We want to win without a lot of caveats or explanation required on pickups and compact SUVs and certain segments of lux, and we'll go from there. It's 000 in the end game. We'll all get there at some point in time, probably sooner than we think right now. But in the early days, that's how we're parsing it out and how we're focusing.

Absolutely. That's super helpful, Steve. I think we are out of time. I could go on forever, but we'll end it there. Thank you so much for participating in a really great discussion. I always learn a lot from talking to you. Thanks to the entire GM team for making this happen as well. Thank you all for participating in the session today.

Yes. Well, thanks for the opportunity. I enjoyed it.

Absolutely. Great. So with that, we'll go ahead and conclude the session. Thanks again to General Motors, and thank you all for joining us.