General Motors Sets Strategic Vision on Efficiencies

Operating margins for General Motors (NYSE:GM) are predicted at 5%, while Ford (NYSE:F) and Hyundai are at 7% and 10%, respectively. To address that low number, Bloomberg is reporting that GM has brought on consultants Hackett Group to advise on where savings within the company can be found.

As opposed to 2009, however, buyouts and large numbers of layoffs will not be considered. And despite any talk of cutbacks recalling past times of major losses personally and professionally for the company, GM benefits from having new products awaiting their debut.

According to an outside analyst, GM matching Hyundai’s predicted returns is not likely because the Korean car maker has the benefit of exchange rates and greater efficiency. This analyst believes that GM’s efforts to cut costs will only find “a rounding error,” though even that may be a good start. Anything could help GM against competitors within its range, such as the aforementioned Ford, Volkswagen — with an operating margin of 7.7%. and Toyota (NYSE:TM) under 5%.

Here’s how top car manufacturer stocks are reacting to the news:

General Motors Corporation (NYSE:GM): GM shares recently traded at $19.91, up $0.05, or 0.25%. They have traded in a 52-week range of $19.00 to $39.48. Volume today was 2,964,368 shares versus a 3-month average volume of 12,226,300 shares. The company’s trailing P/E is 4.35, while trailing earnings are $4.57 per share.

Ford Motor Co. (NYSE:F): F shares recently traded at $10.60, up $0.08, or 0.76%. They have traded in a 52-week range of $9.05 to $18.97. Volume today was 15,198,102 shares versus a 3-month average volume of 60,067,000 shares. The company’s trailing P/E is 6.36, while trailing earnings are $1.67 per share.

Toyota Motor Corp. (NYSE:TM): TM shares recently traded at $64.91, up $0.66, or 1.03%. They have traded in a 52-week range of $60.37 to $93.90. Volume today was 148,853 shares versus a 3-month average volume of 530,476 shares. The company’s trailing P/E is 39.53, while trailing earnings are $1.64 per share.

To contact the reporter on this story: Brooke Edge at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com

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