GM design head says cuts won’t compromise quality
CHICAGO (AP) ” When Ed Welburn does the math, he knows he won’t be able to design as many cars and trucks for General Motors Corp. after the big white-collar payroll cuts come by the start of May.
Fewer designers means fewer products. It’s that simple.
“It will be a challenge, I don’t deny that,” Welburn said Wednesday in an interview at the Chicago Auto Show. “We certainly won’t be able to do everything that we’d like to do, but every vehicle that we do is going to be a strong design, a very relevant design, a design that’s done with incredible quality inside and out.”
The wounded GM on Tuesday announced it would cut 10,000 salaried jobs across the globe as it tries to slash expenses and prove to the U.S. government that it is worthy of getting federal loans. Already the Treasury Department has loaned the Detroit auto giant $9.4 billion, with another $4 billion possible once it turns in a plan to show its viability on Tuesday.
Without government money, GM may have run out of cash and could have been forced into Chapter 11 bankruptcy protection.
Welburn, GM’s vice president of design and responsible for the way cars and trucks look, said the viability plan will include details of GM’s products into the future, a lineup that he says has cutting-edge design and engineering that will do well in the marketplace.
“We have what I know is a very strong portfolio of vehicles that are coming,” he said. “I reviewed every bit of it just a couple of days ago.”
He wouldn’t say how many cars and trucks are in the plan, but said he has been working nights and weekends preparing it so Chief Executive Rick Wagoner and Chief Operating Officer Fritz Henderson can present it to Treasury officials.
The products are just one part of the plan, which also has targets that include concessions from the United Auto Workers and bondholders and a reduction in GM’s eight-brand lineup, pruning out the ones that are unprofitable.
Welburn wouldn’t comment on what brands will go, but he said having fewer of them will help designers and engineers focus squarely on what’s left.
“We’re able to really focus, and we have said publicly, really focus on Chevrolet, Cadillac, GMC and Buick,” Welburn said. “We’re able to focus on that in a way that I think will show some real benefits.”
GM has said that the Hummer truck brand is up for sale, while it is reviewing Saturn for possible takeover by the dealer network. Saab also is for sale, and Pontiac likely will be pared back to just one or two performance-oriented models.
Of the job cuts, 3,400 will be in the U.S. But Welburn says his department will feel the pinch because it has 11 design studios worldwide, although he said it has run lean in recent years.
He wouldn’t say how many employees he will lose, but said even though design cooperates more with other departments and moves faster than it once did, GM won’t be able to do everything it should in the future.
“If we had more people, if we had more money, there are some products, I think some very important products, that you would want to do.”
The Detroit-based automaker said Tuesday it will reduce its total number of white-collar workers by 14 percent to 63,000. About 12 percent, of GM’s 29,500 salaried U.S. jobs will be eliminated.
With white-collar pay cuts of 3 to 7 percent also coming, Welburn is worried he may lose top designers to other automakers, but said GM is doing its best to keep people happy.
The company, he said, will not let cuts affect the quality of its designs, especially in its interiors, where he says the company has made great progress.
“We can’t do that. Our customers won’t accept it. We’re just going to have to work harder looking at the trade-offs and looking at creative ways of developing these interiors,” Welburn said. “Creative solutions that don’t compromise the interiors.”