GM Chief Outlines Growth Strategy: China, Cadillac and New Technology

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Just days after Ford Motor warned of headwinds slowing its financial performance, General Motors chief executive Mary Barra Wednesday gave investors a more confident outlook, saying GM is on track to achieve 10 percent operating margins in North America and restore profits in Europe by 2016.

In a presentation to analysts at GM's vehicle proving grounds outside Detroit, Barra said the automaker's goal is to achieve overall earnings before interest, taxes and special items (EBIT-adjusted) of 9 percent to 10 percent by early next decade.

'We have the resources. We have the technical talent. We have the global footprint. It's about execution,' Barra told reporters ahead of the investor meeting.

It'll require new products and technologies that resonate with consumers, a stronger Cadillac brand, continued growth in China, a stronger financial arm, and more efficient approaches to engineering and purchasing.

Barra said the company's objective is to become the world's 'most valued automotive company' - not just in terms of shareholder returns, but also in customers' eyes. 'We understand we have to earn customers for life,' she said. 'Every chance to connect with customers is an opportunity to build a stronger relationship.'

Barra has a lot of work to do to restore customer confidence after a spate of recalls, especially a deadly ignition switch flaw in older models that is blamed for at least 21 deaths.

'This is our first opportunity to talk about the future of the company,' said Barra, who has been consumed by the recall crisis almost from the day she became CEO on January 15. She said her management team, including President Dan Amman, global product development chief Mark Reuss, and chief financial officer Chuck Stevens are aligned behind the plan.

Barra said GM's goal is to drive sales and profit growth by adding new products and technologies like 4G LTE high-speed mobile broadband, which is rolling out now; vehicle-to-vehicle connectivity which launches in the 2017 Cadillac CTS and Super Cruise, a 'highly automated' driving mode which allows for extended periods of hands-free driving on highways.

GM said it has also patented a new welding technology that will allow it to introduce an innovative mixed material body structure, incorporating a combination of steel and aluminum components. That will enable new lightweight vehicle structures that require 20 percent fewer parts, yet are stiff and quiet.

Cadilac, which GM said last week will become a separate business unit headquartered in New York, plans to introduce four new models in North America in 2015, including the recently announced CT6 flagship. But the real opportunity for Cadillac may be in China, which is expected to become the world's largest luxury car market later this decade. Cadillac plans to introduce nine new models in China in the next five years.

Cadillac will help GM's overall growth plans in China, where it plans to invest $14 billion by 2018 to open five new assembly plants and sell almost five million vehicles a year. GM expects to launch 60 new or refreshed Cadillac, Chevrolet and Buick brands in China, including nine new SUVs, in China. GM Financial, GM's lending arm, also plans to enter China later this year.