DETROIT, MICHIGAN. JANUARY 12, 2009.
At the North American International Auto Show, I had the opportunity to chat one-on-one with James E. Taylor, Chief Executive Officer of HUMMER.
Jim Taylor has been with General Motors since 1980, working at Saturn, Opel, Worldwide Purchasing and GM Truck. His most recent position was as General Manager for the Cadillac brand. In mid-October of 2008, Mr. Taylor took over as the CEO of HUMMER.
He's been charged with the present operation of the brand, and with formulating its future strategy.
Mr. Taylor and I stood beside an H3T and talked about what might happen with HUMMER in the near future.
ABOUT: I'm a fan of the HUMMER brand. My favorite is H3 Alpha. I hope it can stay in the market.
JAMES E. TAYLOR: Staying in the market -- we can get to the key topic fast, which is what everybody's wondering about, especially from a customer standpoint. And the dealers, too. My role in life right now is to make sure that happens and to go out and canvass the investment market and find a new mother that wants to invest in the future. You can't just sell what you've got, you've got to be hiring, and reinventing the next gens of whatever -- H3s, H2s...
In the world that we're heading toward the big challenge for all HUMMERs and all SUVs is to try to comply with the world that Washington has elected to describe, non-negotiably, in 2011, '12 and on out to '17, is going to make it extremely difficult for all SUV manufacturers to comply.
It's almost like they've worked themselves backwards to pre-decide that customers should not be permitted to buy SUVs. It's a bit of an Orwellian state we're headed towards.
So, the answer's going to be a lot of technology and a lot of powertrain improvements that allow lower-displacement, higher fuel economy, probably turbocharged engines that allow you to get into that high 20s, low 30s in terms of fuel economy -- that's a bit of a stretch from where SUVs travel today. I'm not talking about HUMMER. All SUVs. So, in that space, we've got a product plan that we have in mind for an investor as they buy the company to say, okay, immediately execute to be able to be not just customer-friendly in that kind of time frame, it's to be legal and compliant and saleable.
The world of SUVs, the face of the SUV world is going to change dramatically in the next four or five years. People who don't pay attention to this industry will wake up in four or five years and look around and go, "Hey! What happened to my truck?" Oh, you should have been paying attention five years ago when your Congressmen were voting on a future state that sounded good but is really going to premeditatively decide the fate of large trucks. So, that's our challenge, to stay in front of that and to make sure that we come up with the kind of powertrain solutions that are going to allow us to get into that space.
ABOUT: I assume that you're looking globally as well, beyond North America...
JT: Yes, absolutely. Even this year, a third of our volume is global. People think of HUMMER as an American brand, but as the US economy shrank faster this year than the rest of the world, it was heading even higher than 30% of our volume. We're looking sales-wise more than the US, but also from powertrains. Right now we're gearing up for a diesel for the rest of the world that we've finished the engineering to implement. Okay, if that became a play, is that something that we should bring here, too?
China's another market, and they're into displacement taxes. In Europe, it's carbon. In the US, it's CAFE (Corporate Average Fuel Economy). So it's not going to happen, but it sure would be nice if the world agreed: We're going to go after a better environment, and less oil. What's the way to go at that? So far, everybody's going at it in a different way. So to sell around the world, you have to find all those different solutions.
ABOUT: Your chief competitor in the US has downsized, and gone to a car-based SUV. You haven't made that move.
JT: I give them a lot of credit. They've done a grand job with price point, cheaper, less-expensive. We've tried to remain a little more premium. Chassis solutions, interiors, materials -- a little more premium. All those are product decisions that you have to make. To their credit, they've got a lot more volume, so they've widened their envelope and appeal to a much broader market. As a brand -- it's a fabulous brand. Just Jeep. The word "Jeep," and the reputation they have -- they've done a great job of that.
ABOUT: Well, they had a bit of a head start on you.
JT: Yeah, they did. They good news is, they have a broad appeal and a high volume. Now, the bad news is, if you're a brand -- they have a really broad appeal. So if you start saying, well, what is a Jeep? Used to be, a while ago, you knew how to answer that question. If you asked, what's a HUMMER? It'd probably be pretty close to dead on when you answer the question.
In HUMMER's case, HUMMER is still HUMMER. We haven't stretched it outside to be all things to all people and to appeal to a really broad market. It's stayed very focused, and it delivers. As competition gets higher and higher and higher and there's more supply side, the guys that win are the guys that have brands that are real ones. That deliver what they say they're going to do. So that's the good thing about HUMMER. That's an attractive proposition for some investor that wants to buy a little car company that's successful and has a good brand. That's our hope.
Interview continues on the next page...