Mary Barra, Chair and CEO, General Motors (appearing virtually) Interviewer: Alyson Shontell, Fortune
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00:00Good morning, everyone.
00:01Good morning, Mary.
00:03Thank you for being here with us today, to each of you.
00:05And congratulations, Mary, on the cover of Fortune.
00:08We were so honored to put you there.
00:10Congratulations to 10 years at the helm of VM.
00:16Well, first of all, thanks to you and thanks to the crowd.
00:18I'm really honored to be in that position.
00:21And I'm so sorry that I can't be live.
00:23My schedule didn't allow me to travel.
00:25But I'm thrilled to be here virtually
00:28and looking forward to having our conversation.
00:30Yes, absolutely.
00:31So Mary, I'm not sure if everybody realizes
00:34that between you and your dad, you
00:35have like 80 years combined experience at GM.
00:39Pretty incredible.
00:40You started at the company when you were 18 years old
00:43in a stamping plant to help pay for college.
00:46At what point did you realize, I could
00:48be the CEO of this thing, and actually, I
00:50want to be the CEO of this thing?
00:53Well, I think it was pretty far in my career.
00:56I feel like I've had 10 careers at General Motors,
00:58starting as a college co-op student,
01:01working in many different areas.
01:02But when I was in the role of global product development
01:06and I understood that I was being considered,
01:08that literally was the first time
01:10I really thought about it.
01:11Through my whole career, though, I always
01:13looked for opportunities where I could continue to grow,
01:16continue to learn, and continue to have
01:18more and more responsibility.
01:19So when I understood I was being considered, of course,
01:23I went for it.
01:26And here we are 10 years later.
01:27Incredible.
01:28Well, you have been in the role for 10 years.
01:31That is two to three times longer than average, actually.
01:34For women at Fortune 500 companies,
01:37those who are fortunate enough to run them,
01:39the average is about 4.5 years in the role.
01:41And for men, it's seven.
01:43So you're off.
01:44And you've done a lot.
01:45And there's been a lot of transformation you've had to do.
01:47It hasn't been easy.
01:48Starting with, really, your first day on the job,
01:50you had a cultural transformation
01:51you need to make on your hands.
01:53It was a big recall for GM at the time.
01:56I think there was even a SNL skit poking fun at you.
01:59There was a lot going on.
02:00You've had to deal with a lot.
02:01So at the time, you had said, everything just
02:04felt bad at the company.
02:05I'm wondering what steps you made
02:06to make morale feel good.
02:08How do you do a cultural transformation?
02:10What are the important steps to get your employees back
02:13engaged through thick and thin?
02:17Well, at that time, when I first took the role,
02:20one of the things we had been working on prior to me
02:23being named CEO and also dealing with the ignition switch
02:27recall was we'd been working on what our core values were.
02:31And so as we got into this difficult period,
02:33we really used it as an opportunity to live the values.
02:37It's easy to live your values and have a corporate mission
02:39statement when everything's going well.
02:41But when you're really challenged,
02:43that's when people really take notice.
02:45And so we demonstrated the values.
02:47We also said, look, we're going to do everything
02:49in our power to help our customers through this period.
02:51We're going to be transparent.
02:53And then we're going to do everything possible
02:54to make sure something like this never happens again.
02:57And that really rallied the team.
03:00I would say, though, at that point in time,
03:02there was so much being written about General Motors
03:04of its culture and that it wasn't right.
03:07And I literally felt that pressure.
03:09But what I realized is your culture
03:11is just a collection of the way people behave every day
03:14and what happens to them.
03:15Do they go home from work and talk to their neighbor,
03:18talk to their child's soccer co-parent,
03:22or do they say, wow, I had a great day.
03:24I'm working on something really exciting.
03:26I feel supported and valued.
03:28Or do they go home and talk to that same neighbor
03:30and say, you know, I had a really tough day at work.
03:33I'm trying to do the right thing,
03:35and I'm just meeting resistance.
03:37And so we realized what we needed
03:39to do to have the culture that we wanted
03:41is to change all of our behaviors
03:43and to make sure we were creating that environment where
03:46people would feel valued and do their best work.
03:49And frankly, that's the journey we've been on
03:51through this whole period.
03:53So that's great advice for cultural transformation.
03:56It starts at the top with the behaviors that you're setting
03:58and really thinking about the impact
04:00that it's having on your employees.
04:02That's not the only transformation you've had to do.
04:04I'm sure a lot of this audience remembers,
04:07but many others might not.
04:10There was actually a bankruptcy for GM in the early 2000s.
04:14And now the net income for the company is over $10 billion.
04:18It's a pretty incredible financial transformation.
04:21And one of the core decisions you made
04:24that you said was a sea change moment for the company
04:26was deciding to scale back on some of the operations
04:29outside of the US that just weren't working
04:31and doing what you've always done.
04:33If it's not working, you can't keep doing it.
04:35That's not always easy to see, though,
04:37when you've been at a company for as long as you have
04:39or when you feel like it worked once,
04:42but why isn't it working now?
04:43So how did you stay fresh and innovative
04:46and just fight complacency and make those decisions
04:48that have righted the financial ship?
04:52Well, prior to bankruptcy and the restructuring,
04:56I think General Motors felt they had to be everywhere
04:58for everyone with every segment.
05:01And so as I got into the role
05:03and we moved past the ignition switch recall,
05:07we realized that our industry was being disrupted
05:10and we made the decision we're gonna join
05:13and lead the transformation,
05:14whether it be electric vehicles, software,
05:17autonomy, et cetera.
05:20And so with that, we had a,
05:22one of the most important things you do as a CEO
05:24is you're very invested in how you deploy capital.
05:27And so we started to change the rate of,
05:30if you don't have a, if you're not profitable
05:32or you don't have a plan to be profitable,
05:34how can we just continue to invest and destroy capital
05:38and really destroy our owners' capital, our shareholders?
05:43And so that was kind of a big shift within the company
05:45that we started in that 14, 15, 16 year timeframe
05:49of really looking where could we play to win?
05:51It wasn't that we just got everywhere
05:52that wasn't making money.
05:54There were places we stayed
05:55because we knew if we invested,
05:56we could have a strong business and we're seeing that today.
05:59But we had to go through that process
06:01and realize that we had to be better stewards
06:05of our owners' capital.
06:08And now the point that we're in with company,
06:11you've gone through an EV revolution,
06:14really the whole world is experiencing it.
06:16And some markets are quicker to adopt it than others.
06:20One particularly interesting market for you
06:22and for everybody I think is China.
06:24China has become like this EV epicenter,
06:27but it's really hard for outside companies
06:29to penetrate there because there's so many companies
06:33that are creating cars in China
06:34that are funded by state-owned enterprises
06:37and by government money.
06:38They're so cheap.
06:40And we've actually said,
06:41while it's been a strong market for you historically,
06:44if this keeps going, it could be a race to the bottom
06:46at this pricing level.
06:47That's really, really hard to compete.
06:49And GM has experienced I think like half the deliveries
06:52today that you were experiencing six years ago
06:54in the market.
06:56So I'm curious when you think about winning in China
06:59for a company like GM, is it possible?
07:02And at what point do you apply that same logic
07:04that you applied to other operations outside the US
07:07that weren't working there?
07:10Sure, well, when you look at China,
07:11there has been a structural change
07:13with the shift to electric vehicles
07:14and what in China they call new energy vehicles,
07:16so either hybrids or electric vehicles
07:19that has caused a shift.
07:20And when you have more than 100 domestic Chinese OEMs
07:25entering the market, most of which are losing money,
07:29it is exactly as you said, Alison,
07:31it has become a race to the bottom with pricing
07:34and the level of subsidies.
07:36Generally, I'm a free trader.
07:37Give me a level playing ground
07:39and let's compete based on our product
07:42and how well we serve the customer.
07:44But that's the situation we're facing now.
07:47Now, China's still an important market.
07:49It's the largest market
07:51and it still has tremendous growth potential.
07:53So at GM, what we're doing is we're working
07:55to restructure the business.
07:56We're working with our partner to make sure
07:58that we can move forward in a way
08:00that we can participate differently
08:02and still give customers choice for vehicles
08:04that may not be created from a Chinese OEM
08:08that GM has that references our strong brands,
08:11the quality and for instance right now
08:14with our own retail channel,
08:16we've just started to take orders for the Chevrolet Tahoe.
08:19So we think it's a market after we restructure,
08:22we can still participate in in an appropriate way
08:25and it can be a business that has growth for General Motors.
08:28But it's gonna take that change.
08:30And I guess when you look at adoption in China
08:34versus adoption in the US for EVs,
08:36it seems like there's a lot that potentially
08:38we could learn in the US about infrastructure.
08:40We still have charging anxiety here in the US
08:43that they don't experience there
08:44because they've laid out a good network
08:46of charging stations in China.
08:48I'm curious, what do you think is going on
08:50with the US consumer in EVs with the US market?
08:53What do we need to do to get there to be more adoption
08:56because they still have your goal,
08:58I believe of being pretty gas free
09:00for your vehicles that are lightweight by 2035.
09:04But the consumer in the US just seems to be slower to adopt
09:07than we had initially thought.
09:10Well, I think the consumers in the US
09:12and in most markets is very rational.
09:14And so when you look at what has happened in the recent past
09:18is cars either didn't meet the range,
09:20300 mile range for the US is kind of a magic number.
09:24Otherwise people have range anxiety.
09:26There was not affordable EVs.
09:28That's why we're very proud
09:29to have the Chevrolet Equinox and Blazer
09:32that get into that affordable range.
09:34And those vehicles are doing very well
09:35as we're ramping them up in the second half of this year.
09:39And then also you mentioned charging infrastructure
09:42is so important.
09:43I'm really excited that just last month
09:45we were able to open up the Tesla charging network.
09:48In addition to what we're investing in
09:50with Pilot Flying J, the partnership we have with EVgo
09:53and with several other charging networks.
09:55Because I think every quarter
09:57the charging infrastructure gets better
09:59and it's gonna open up for more and more people
10:01to be able to legitimately consider an EV
10:04if it's their only car
10:05and they need it for all of their use cases.
10:07I think a lot of people who own EVs right now
10:09have another ICE vehicle in their garage.
10:11So they're not having to make that choice
10:13and be so dependent on what the charging infrastructure is.
10:17But it will get better.
10:18And we finished in the number two position
10:22at the end of September in the US.
10:24We have started to see growth pick up
10:26and GM right now with our EVs
10:28is growing faster than the market.
10:30So I think we're gonna continue to see it
10:33but customers are gonna make rational choices.
10:35So we've gotta continue to have affordable vehicles
10:37that people wanna own and drive
10:39that are beautifully designed
10:40and the charging infrastructure needs to continue to improve.
10:44I know GM's doing its part and it will continue.
10:47I wonder how do you think about,
10:49you know where the future is going
10:51and you're driving the company there very clearly.
10:53This is an EV gas-free future that we want.
10:57But that means destroying your historic cash cow
11:00which is still a huge part of your business.
11:03Gas, cars, fuel, GM for the moment.
11:06So I'm curious how do you think about
11:08building for that future
11:09knowing that your cash cow is gonna have to dissipate.
11:13That's a scary position to be in
11:14and it can be hard for incumbents to be innovative.
11:20Well I think you have to look at
11:21this transformation's gonna happen over a decade plus.
11:25We are the only full line manufacturers
11:27that has said we wanna be all EV
11:30for our light duty vehicles.
11:31But we're gonna be guided by the customer.
11:33And in today's market we're providing choice.
11:35We have great electric vehicles,
11:37we have great internal combustion engine vehicles
11:40and the customer based on where they live, what they need,
11:43they can come to General Motors
11:44and they're gonna have a good choice
11:46of either propulsion system.
11:49But I think as we go forward
11:51and we have more affordable EVs
11:53and we're working, we're on track
11:55to be bearable profit positive by this year end
11:58and then we're gonna continue to work
12:00on improving the profitability
12:01to get it to like ice like margins
12:04as we move forward in this decade.
12:08And in addition to that,
12:09I think when people drive an electric vehicle,
12:12they're fun to drive.
12:13It opens up all new styling, instant torque,
12:16never having to go to the gas station.
12:18There's so many positives that we think
12:20when people have that experience
12:22and trust that there's charging infrastructure
12:25to support them, they're gonna wanna move to an EV.
12:28So that's the journey that we're on
12:31but we're gonna be flexible based on where the customer is
12:34and really be driven by the customer.
12:38All right, and GM really had the first EV
12:41on the market in the 1990s.
12:43As it was the first mover advantage,
12:45how even really almost a decade headstart on Tesla.
12:50So we should talk about Tesla a little bit
12:51because they do own the majority of the market.
12:55When you think about the fact that GM was first,
12:57like Tesla shouldn't even exist, GM should have it all.
13:00Like what would you redo in hindsight
13:04and what advice would you have to someone
13:05who's facing an aggressive startup,
13:07maybe even run by Elon?
13:10Well, I think I am very proud of our history with EV1.
13:15I actually think at that point in time
13:16where battery technology was, we were ahead of our time.
13:20We never stopped working on battery technology
13:23within General Motors and that's what led in 2010
13:26to the Chevrolet Volt,
13:27which was an extended range electric vehicle
13:29and then to the Bolt, Chevrolet Bolt that was an all EV
13:34that got about around 250 miles of range
13:37that those customers to this day
13:39are still some of the most satisfied customers
13:41across all OEMs.
13:42So I'm very proud of that journey that we're on.
13:45You know, I think we learned a lot with the Bolt
13:48and being the fact that we need to make this transition
13:51and make sure we take our workforce along
13:52because the jobs we provide
13:54I think are important to this company
13:56and the jobs that are whether in the supply base
13:59or the dealers are also very important.
14:01We need to make that transformation.
14:04Do I wish we would have had some of the EVs
14:06we have now a couple of years earlier?
14:07Sure, but we realized with the learnings
14:10that we had from the Bolt that we needed to dedicate
14:13and have a dedicated EV platform
14:15which we started working on in 2018.
14:19First rolled out in limited volume
14:21with the Hummer in 2021
14:24and now we're ramping up quickly.
14:25So the investments we made in 2018
14:28are really what are setting I think General Motors apart
14:31from a lot of traditional OEMs in being ready
14:35and being able to get to profitability.
14:36We also invested in the battery raw materials supply chain
14:40as well as batteries
14:42and making with our partner LG Energy Solution batteries
14:46in the United States is giving us an advantage
14:49because of that vertical integration
14:51but with the partnership
14:52we were able to do it very capital efficient.
14:55So we're gonna continue on this journey
14:56and we'll respond to whatever the market drives
15:00because we've got that flexibility.
15:03The other trend that's happening in your industry,
15:06I mean, there's so much Mary,
15:07like the rest of us are just trying to grapple with AI
15:09and you've got autonomous vehicles
15:11that are gonna be driving themselves at some point here.
15:13And I think that future is actually sooner than we think.
15:16I'm curious, when do you think the autonomous future
15:19is going to be?
15:20And some of the lessons learned
15:22that you've experienced through Cruise,
15:24you were very aggressive in moving on that technology,
15:27you put a lot of resources into it.
15:30There was a pretty big hiccup last year
15:32that derailed the initiative
15:34but the autonomous future is still there.
15:35So how do you think about
15:37when we're gonna experience that future
15:39and like the learnings from Cruise
15:42to reset the market expectations for it?
15:44Well, I think the learnings from Cruise,
15:46one of the biggest is you've got to work
15:47and build the right relationship with the regulators
15:50at the local level, the state level and the federal level
15:53when you have a technology that is so transformational.
15:56And we believe that when you get to,
16:00whether it's a robo-taxi and it's in unique communities
16:05where you have autonomous vehicles
16:07and getting all the way to personal autonomous vehicles,
16:09which I believe in, that it's going to be safer
16:12because they drive knowing all the laws,
16:15they don't drive impaired.
16:17And so we are trying to move to a safer future.
16:20And on that journey,
16:21we also have technologies like Super Cruise,
16:23which is one of the most trusted
16:25driver assistance technologies
16:28that really people tell us
16:30once they've experienced Super Cruise,
16:32they say, 80% of them say,
16:33I either wouldn't buy a car without Super Cruise
16:35or I strongly prefer it on my next vehicle.
16:38So I think we're moving in the right direction.
16:40Clearly the technology has taken longer
16:42than I thought when we first acquired Cruise in 2016.
16:46Generative AI and all the advancements happening,
16:49I think I have the opportunity to help us accelerate,
16:52but we still have work to do.
16:53From a Cruise perspective,
16:55we're doing driverless testing right now in Houston,
16:57and we're going to continue
16:59because General Motors believes in personal autonomy
17:03and what autonomy can do to help people move,
17:07not only safer,
17:08but give people back that precious commodity of time.
17:12Well, I hope your autonomous future has seatbelts in it,
17:14because I saw some of Elon's mock-ups
17:16and there was not one seatbelt in that robo-taxi.
17:18I don't want that future,
17:19that doesn't look very safe.
17:21But I'm curious-
17:21You still have to comply with laws.
17:23Exactly, put the seatbelts in.
17:27So, you know, look,
17:28with the pace of change being what it is
17:30and all that you've experienced,
17:32it can be really hard on employees.
17:33There's a lot of rescaling that needs to be involved.
17:37There's sometimes resistance to change
17:39and fear that technology will replace jobs.
17:43You have a huge workforce.
17:45You've dealt with things like union strikes
17:47as change is happening.
17:49I'm curious, sort of,
17:50how do you keep employees excited
17:53about the future that they're building,
17:55keep them on target, on task,
17:57and also help them be prepared
17:59for the future themselves and their roles?
18:02Well, you know, one of the things we've said
18:04in this journey,
18:05and especially speaking to our manufacturing teams,
18:09we really feel that they're a competitive advantage
18:11because they know how to safely build
18:12high-quality vehicles at rate.
18:14And so we have plants right now
18:16that have the ability to build ICE or EV,
18:18and we'll continue to add to that as we move forward
18:22and as EV demand grows.
18:24You know, from an overall perspective,
18:26it's communicate, communicate, communicate.
18:28And I was just in a meeting this morning,
18:30we were talking about,
18:30we need to do more communications
18:32to help people understand not only, you know,
18:35where we're headed and why,
18:37from an EV perspective, from a software perspective,
18:40but also we're going to continue to be agile and flexible
18:44to meet the customer where they are,
18:46because it is changing.
18:47I think, you know, a year or two ago,
18:48everybody thought it was going to be a, you know,
18:50straight rocket ship lineup to 100% EV adaption.
18:54We're seeing now that, you know,
18:56and we never thought it was going to be a straight line.
18:58So we've got to adjust,
18:59but we've got to make sure our employees know
19:01when we adjust, why we're adjusting.
19:03So if we've been communicating,
19:05I would say we need to up our game
19:06and continue to communicate even more.
19:09And your big vision is a world with zero crashes,
19:13zero emissions, zero congestion.
19:16I think we're all on board for that.
19:17That would be great.
19:19But if you've said electrification is the key,
19:22so, and we're still early days
19:24really in this EV evolution as well.
19:26So I'm curious,
19:27when do you think that goal is realistically achievable?
19:31And as a leader,
19:32how are you preparing for the organization
19:34in case it's not during your tenureship,
19:36it's maybe it's 50 years out or at some future state,
19:39your GM has been around for 116 years.
19:42How are you thinking about that long-term vision
19:45and your role in it and guiding the org
19:47even past your tenureship as CEO?
19:50Well, first of all, I'm having a tremendous amount of fun.
19:53I mean, what an opportunity to be,
19:55and I'm humbled to lead General Motors
19:57during this period of tremendous transformation
19:59and opportunity.
20:01So as an engineer, it's something very exciting to me.
20:04But I think it's having a leadership team that's aligned
20:07and really all of the things we've accomplished
20:09are not from what I've done,
20:11but it's what we've done as a team
20:12and motivating and engaging our entire workforce.
20:15And we're gonna continue to do that.
20:18But I also think it's making sure we've laid the foundation
20:21that next generation and next generation
20:23continue to build on.
20:25And it's because we believe we're moving to vehicles
20:28that are better, vehicles and methodologies
20:31where we can be safer,
20:32and then technologies on the vehicle
20:34that provide a customer experience
20:37we can't even imagine today.
20:39So that's what excites me about that journey.
20:41I've learned long ago,
20:42predicting what year something's gonna happen
20:44is generally wrong.
20:45So I'm just gonna say,
20:46we're gonna keep marching to that agenda
20:49with intent and with speed.
20:52And again, not to oversay it,
20:54but the customer will dictate how we move
20:57because at the end of the day,
20:58they tell us if we're right or not.
21:01And as you think about your leadership,
21:04the fact that you've been in this role for 10 years,
21:06you've gone through so much transformation.
21:07When you're meeting with other CEOs
21:09and they're looking for advice on how can I
21:11not just survive in this role, but thrive in this role,
21:15what do you think is a key characteristic
21:17of your leadership that has kept you in this role
21:20amid so much change that you would advise other CEOs
21:23to think about for their tenureship as well?
21:26Well, I think my learnings,
21:27and I've learned a lot from so many other CEOs
21:30that I'm grateful for them investing time in me.
21:34But what I've learned is first up,
21:35first thing is do the right thing even when it's hard.
21:38I think too often people think they have a decision.
21:40You just gotta do the right thing and move forward.
21:43That's something I learned very early in my tenure as CEO,
21:45going through the ignition switch crisis.
21:48The other thing I always say to people is,
21:50when's the best time to solve a problem?
21:52And they kind of look at me perplexed.
21:54And I say, the minute you know you have one.
21:56Because problems rarely get smaller.
21:59I think the other thing that it's important to know
22:01is it's all about the people.
22:03I mean, the people of your company are what distinguish you
22:06from others in the industry.
22:08And so making sure you have an engaged workforce
22:11that feels empowered, feels valued,
22:13is something we continue to work on.
22:16So it's about the people, it's about doing the right thing,
22:19it's about solving problems.
22:21Yes, and the problems don't get smaller.
22:22I like that advice very much.
22:24So thank you, Mary, so much for your time.
22:26It's been an engaging conversation,
22:27and we hope you have a great rest of your day.