WEBVTT

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>>GERRY: HELLO AND WELCOME TO
INSIDE INDIANA BUSINESS.
I'M GERRY DICK.
GENERAL MOTORS DROPPED A

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BOMBSHELL THIS WEEK...ANNOUNCING
PLANS TO CLOSE FIVE PLANTS AND
ELIMINATE AN ESTIMATED 14,000
JOBS.

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GM APPARENTLY SHIFTING GEARS
TOWARD SUVS, PICKUPS, CROSSOVERS
AND AWAY FROM PASSENGER
CARS...WHICH PERHAPS PUTS THE

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FORT WAYNE ASSEMBLY PLANT IN A
GOOD POSITION...THE CHEVY
SILVERADO AND GMC SIERRA ARE
ASSEMBLED THERE.

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FOR MORE ON THE GM PLAN AND HOW
IT COULD IMPACT INDIANA...LET'S
GET SOME PERSPECTIVE FROM IU
KELLEY SCHOOL OF BUSINESS

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ASSOCIATE PROFESSOR OF
OPERATIONS MANAGEMENT ROD
PARKER.
WELCOME TO THE SHOW!

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>> THANK YOU.
>> BIG ANNOUNCEMENT PART OF A
MASSIVE RESTRUCTURING THAT
GENERAL MOTORS FIVE PLANT

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CLOSURES, 14,000 JOBS CUT OVER
TIME.
IS THIS ABOUT CONSUMER DEMAND?
>> YES, IT IS.

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CONSUMERS HAVE SPOKEN WITH THEIR
FEET BACK IN 2008 THE MARKET WAS
AROUND 50 PERCENT PASSENGER CARS
AND 50 PERCENT TRUCKS, SUVS

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CROSSOVERS.
BY LAST YEAR 2017 IT WAS 35
PERCENT PASSENGER VEHICLE 65
PERCENT TRUCKS AND SUVS, SO

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CONSUMERS HAVE SPOKEN WITH THEIR
FEET AND GM HAS BEEN LOSING
MONEY ON PASSENGER CARS FOR A
LONG TIME AND THEY FINALLY BIT

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THE BULLET AND MADE THIS
ANNOUNCEMENT.
>> SOME PAIN AT THOSE PLANT
CLOSINGS AND FOLKS WILL BE LAID

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OFF THEIR, BUT AS YOU LOOK AT
INDIANA EARLY IN THE GAME HERE
AND LOOK AT THE PLANTS AND
GENERAL MOTORS TRUCK PLANT.

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AS YOU LOOK AT THAT PLANT IT
WOULD SEEM TO BE PERHAPS
POSITIONED WELL FOR GM.
>> ABSOLUTELY.

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THEY MAKE THE CHEVY SILVERADO
AND SIERRA AS YOU MENTIONED VERY
GOOD SELLING AND POPULAR
PROFITABLE VEHICLES FOR INSTANCE

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PART OF THE ANNOUNCEMENT WAS GM
CONTINUOUS PASSENGER CAR MODELS
AND THE TOTAL OF SIX MODELS THEY
SOLD JUST UNDER 200,000 UNITS IN

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THE CHEVY SILVERADO ALONE SOLD
FOR 24 OVER THE SAME TIME SPAN.
SO THAT FACILITY IS WELL-PLACED
GIVEN THEY ARE MAKING THESE

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TRUCKS THAT ARE WELL RECEIVED.
>> ANY THOUGHTS ON VESPA?
>> THEY ARE MAKING PARTS THAT
ARE GOING FOR TRUCK

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TRANSMISSIONS, BUT ALSO PARTS
GOING TO PASSENGER CARS SO THEY
MIGHT HAVE SOME REMIXING OF
THEIR PRODUCTION BUT THEY WILL

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BE STICKING AROUND AS WELL.
>> IN THIS MOVE TO SUVS AND
CROSSOVERS HAS BEEN COMING FOR A
WHILE.

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6-7 MONTHS AGO FORD HAD A MAJOR
ANNOUNCEMENT AND IN INDIANA
HONDA IN LAFAYETTE.
THOSE PLANS ARE IN THAT GAME.

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>> THAT'S TRUE.
AT SUBARU THEY MAKE THE OUTBACK
CROSSOVER AND THE NEW SUV TOYOTA
MAKES THE HIGHLANDER, THE SIENNA

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AND THE SEQUOIA.
THEY ARE WELL PLANNED AND THEY
ARE VERY POPULAR CARS MADE BY
HANS OF THE THE CRV AND THE

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CIVIC.
SO ALL OF THEM SEEM TO BE WELL
PLACED GOING FORWARD.
THE MIGRATION TOWARD TRUCKS AND

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SUVS CONTINUOUS.
>> AS YOU LOOK AT GM
LONGER-TERM, THIS RESTRUCTURING
IS EXPECTED TO FREE UP

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$6 BILLION BY THE END OF 2020.
THEY ARE DOUBLING DOWN ON
AUTONOMOUS VEHICLES AND
ELECTRIFIED VEHICLES.

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>> THAT IS RIGHT.
GM SPENDING ABOUT A BILLION
DOLLARS A YEAR AND TWO YEARS AGO
THEY PURCHASED IN A VEHICLE AND

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CRUISE AUTOMATION AND APPARENTLY
THEY HAVE BEEN DOING WONDERFULLY
GOOGLE IS STILL NUMBER ONE.
PEOPLE SAY JIM IS DOING VERY

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WELL AND MOST PEOPLE SAY THEY
ARE SECOND TO WAY MOST SO THAT
IS PROBABLY GOOD AND GOING TO BE
A STEP TOWARD A RIDE SHARING

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SERVICE THAT MARY BARRA SAID
THEY WILL LAUNCH NEXT YEAR.
THAT WILL BE EXTREMELY
PROFITABLE FOR THEM.

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>> THREE SECONDS LEFT, BUT AS
YOU LOOK AT THIS PLAN UNBALANCED
EARLY ON IS IT A GOOD MOVE FOR
THE COMPANY?

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>> I THINK IT IS AND FOR A
LONG TIME THEY HAVE BEEN USING
INCENTIVES TO PUSH THE
MONEY-LOSING VEHICLES AND NOW

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FINALLY THEY'VE BITTEN THE
BULLET AND I THINK IT'S PAST
TIME AND THE MARKET RESPONSE ON
MONDAY WILL SUPPORT THAT.

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>> RODNEY PARKER, GREAT