Yesterday, new GM Europe chief Nick Reilly pulled off a minor management miracle. In doing so, he made it crystal clear why bringing him temporarily back to Europe from his South East Asian fiefdom (where GM has been scoring repeated remarkable successes) was the best thing The General’s big bosses in Detroit could possibly have done at a fraught time like this.
Pausing briefly to meet a small coterie of UK (mostly Fleet Street) hacks in the midst of a whistle-stop European tour to smooth the feathers of government heads and union bosses, Reilly managed to convey the impression - to a notably sceptical audience - that he was speaking for a highly competent management, which had a workable, affordable and ultimately profitable recovery plan ready to go, and only needed the confidence of participants over the next week or two to put it into practice. The fact that the plan involved carving off 20 per cent of GM’s entire European car-making capacity, sending 10,000 of its employees down the road and raising 3.3 billion euros (£2.9bn) from various governments was made to seem eminently “do-able”, as it probably is.
Reilly did have some positives to impart. GM would still make a million cars a year and would still employ 40,000 people. The public sum it was trying to raise was 30 per cent less than Magna’s, and could begin to be paid back in two to three years. Solid profits could be expected in 2012 and GM Europe’s design and R&D skills would be maintained and enhanced.