The GM paradox: Sell more pick-ups, prepare for an electric car world – by Konrad Yakabuski (Globe and Mail – November 28, 2018)

https://www.theglobeandmail.com/

Mary Barra envisions an all-electric future for General Motors. But to get there, she first needs to bank as much profit as possible by selling millions more gas-guzzling pick-up trucks.

Therein lies the paradox of the strategy GM’s chief executive unveiled on Monday as she announced the elimination of six car models and the idling of five North American factories, including the Oshawa, Ont., facility that makes the soon-for-the-scrap-heap Chevrolet Impala sedan.

Ms. Barra is moving to shed slow-selling models and cut manufacturing capacity ahead of a possible recession, all while investing billions in the development of electric and autonomous vehicles. It’s a risky gamble for an automaker that owes its very existence to the internal combustion engine.

GM does not have a sterling record when it comes to weathering disruption. It went through bankruptcy protection less than a decade ago and only exists now thanks to the generosity (or gullibility) of American and Canadian taxpayers. Why would anyone trust Ms. Barra, now?

The big three North American car makers have been abandoning sedans to focus on the pick-ups, crossovers and sports utility vehicles that have been flying off the lots in the past few years. GM’s Silverado and Sierra pick-ups are by the far the most profitable vehicles in its fleet.

For the rest of this column: https://www.theglobeandmail.com/business/commentary/article-the-gm-paradox-sell-more-pick-ups-prepare-for-an-electric-car-world/

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