I picked up a copy of General Motors' 1999 Annual Report recently. I must admit that it's the first such Report I've ever read, however, it certainly won't be the last because it's downright funny. I suppose I should have expected such humor from a company that has been run by buffoons for the past 20 years, an automaker who's products tend to be the laughingstock of the industry. But even the hilarity of GM's latest version of its silly and oft-repeated story (the best-laid plans...) is tempered by the sad realization that many of the people of GM believe in this pathetic fiction.
Open the Report and the first and only word on the page screams, "Potential." Turn the page and this thought is further developed: "6 billion people in the world. Only 709 million vehicles." On page 21, the Report continues this mantra: "Globalization...it means even more potential for growth. because GM is already a global company, with more experience than just about anyone else in that regard." Ostensibly, The General is saying that the great unwashed might like to have cars too-and GM will be just the carmaker to sell to them.
But if you look deeper, there's little to suggest that this is more than just wanton speculation ("more potential"?). In GM's markets outside of North America and Europe, it lost money last year. Its global market share is quoted at 15.8% in 1999, down from 16.0% in 1997. This is largely because its home market share has slid from 30.5% in 1997 to just 28.6% in 1999. Which is all that much worse considering that the vast majority of last year's vehicle sales-and profits-came in North America. Selling cars to aborigines and Buicks to the Chinese is just not a convincing plan for a company this dependent on its home market.
But I suppose that it does make for a decent, albeit failed, dodge from the mediocrity of its products in the U.S. Even the Report finds GM's domestic vehicle line forgettable, as only eight of the 24 pictures of vehicles in the Report are of North American production vehicles and most of these are not glamour shots. At least someone was wise enough to position Smith, "Wagoner and Pearce in front of the picture of the Pontiac Aztec on page 13; the suits block more than half of its ugliness from view. If only it were as easy for The General to obfuscate the fact that its days as the number-one car company in the world are clearly numbered.
I'm afraid that those who might be snowed by the Report's valiant attempt to pass off hope for potential are few. Nearly all of them must count themselves as part of the 10% of GM's North American customers who purchase their vehicles with an employee discount. Not surprisingly, this is at the root of the problem. When you believe the spin, it's hard to deal with reality. The ultimate irony of the Report, thus, is the baby that peers from its cover. A GM employee as a newborn, its innocence and purity symbolized by the deep white background, the image of a car reflected in its eyes. The brainwashing has already begun...