Have the multiplier effects of the program been undermined at all by foreign cars being sold? Four in five of the top-selling cars through cash for clunkers were foreign. Actually, we were a point higher in July than our normal share point. Our [U.S. auto manufacturers'] share of the program was 45 percent in July. We typically have been running 44 percent, so we actually had a point higher. So it's been fair to us. I wouldn't be surprised this month if domestic share goes up. I think we're going to have a really good month.
One worry has been that the program has been so popular, inventory levels at dealerships are now too low. Are you planning on ratcheting up production to address this? That's what we're looking at. Our executive committee met today on that very subject of where we want to increase production.
When? And by how much? I don't want to say, but I can say we've made public that our third-quarter production volumes are going to be up 35 percent versus quarter two, which is a big increase. And we're probably going to boost that further in quarter four. We haven't announced quarter four yet. But, yes, we're looking at what could be some sizeable increases in production.
Are there worries at GM that a program like cash for clunkers—coming on top of the government bailout—makes it look like you're leaning on taxpayers too much? To be honest with you, I really think the negativism that we went through with the bankruptcy, and the ugliness—which was a fun thing to live through—are behind us. Now really what I see happening, one month later after we physically emerged [from bankruptcy], is we're finally able to switch gears and talk about our great new products that have been doing really well over the years. I think we're causing people to go, "Wow, these products are good." And some of the innovative things we're trying are really pretty interesting. So this thinking of, "Oh, we're feeding into the public trough here because of cash for clunkers"—we're not really afraid of that. Besides that, it isn't us. The imports and domestics are all equally benefiting from this. It's pretty hard to draw that conclusion.
Is the program influencing GM to develop more fuel-efficient vehicles? That's the irony of the thing: We've already made that decision. I came into this job a couple of years ago, and one of the first things I did was raise our long-term oil price forecast to a very high number.
Why? You're better to plan for high fuel prices because it makes you do all the right things. It makes you produce fuel-efficient vehicles; even if you don't produce them, your competitors are anyway, so it makes sure you're very competitive. Even if those aren't true, the government is going to mandate it anyway through CO2 emissions [regulations] and CAFE [corporate average fuel efficiency] laws, which they have. Only good things can happen to you when you plan for high fuel prices.
Corrected on : Updated on 8/18/09