More Conversation with Mark Reuss

Here's more  conversation with Mark Reuss, Executive Vice President, Global Product Development, Purchasing and Supply Chain, who spoke to a group of journalists at the New York Auto Show.  He talks about Buick, Cadillac and how he figures out value for GM customers.

So, was this year’s New York Auto Show a big show for you?

Yes. On the Malibu.  “We’ve got competitors that are entrenched in the segment. So [we focused on] things we know are really important in the segment like operating costs, value, comfort and dynamic style. It is really hard to do on a sedan. It’s hard to create something that hasn’t been done before, something original, and I think we’ve done that with the Malibu.”

With Cadillac getting the focus on luxury could you discuss what the strategy is for Buick in the  near term?

Buick’s been very, very successful.  The articulation for me at Buick is really elegance and maybe a different approach to refinement than Cadillac.  And I think that’s what Buick’s always been.  And once in a while we’ll throw a wild card in there that gets everybody’s blood pumping like the GS AWD, which is really a great car and it’s right within Buick because it’s a beautiful car, very refined and elegant and still fun.  So I think that’s it and I think the Avenir exudes every single piece of that that you could ever imagine.  That’s why we did the car.  That car is not a Cadillac.  It’s not ever going to be mistaken for a Cadillac and its not hard to articulate why.  And people get it.  That’s why those brands are doing great—GMC and Buick.

The center for design for Buick is where?  China?

There is no center for design.  We’re a global design center. We really are.  Our brand studio is in Warren, Michigan.  The execution of the car though could happen at a studio in China and it has. Or it could happen here. But I don’t think it’s going to happen in Brazil.  So those are the two spiritual places where the markets are. We can share workloads and we can do all kinds of stuff.

When you talk about Buick as an elegant and refined Brand I think of it in those terms as an older buyer.

You do and I do. The people a generation behind us don’t have any baggage behind Buick typically.  So we’ve got a really cool buyer base that is diverse from a nationality standpoint and also from an age standpoint.  We see a lot of people taking the Asian perception of the brand into the United States. It’s really not traditional, especially on the West Coast. 

Can you articulate why you are successful in the premium segment and nobody else really is—why nobody can find the sweet spot?

I think we have a really clear vision of that and a focus on it and what it is and what it isn’t and that clarity I think is something that people really struggle with especially in a big company.  But I started there and I grew up there.  I worked in Flint for a good chunk of my career.  There are some people that are Buick zealots and know what it should be and think that helps. bringing people in from the outside to tell you what Buick should be is probably not a good idea.  Because we’ve been pretty successful with it since the beginning of General Motors.  I think people get it that work there that work on it.

Is there a development dichotomy between fuel economy and performance?

There are a couple of things I know.  Fuel prices with either stay the same or go up or go down. I am certain of that. I do know there’s been permanent changes in the way people buy.  Some of those are generational and some of those are income based.  We save cost using lower displacement engines that can do the same thing as a larger engine and on a lighter car. We can get our operating costs back—that value equation for the customer is much more valuable than electrification by itself on an older architecture. Independent of gas prices or the economy, that value equation never really changes. There will be electrification pieces that will make a lot of sense because there will be people that want 48 miles to the gallon but they want that at a value equation that pays back. And they like driving a hybrid and they like driving something that’s progressive and has less emissions.  There are people out there and, generationally,  are growing.

How much of a problem is it to get GM’s vehicles selling at higher prices? 

Incentives and discount prices are a road to nowhere.  Offer people what they are willing to pay for, what they value.  It’s what they value.  What are they really buying and what are they willing to pay for? Unlocking that for each car is what’s important. 

Mark Reuss at the New York Auto Show

Mark Reuss, Executive Vice President, Global Product Development, Purchasing and Supply Chain, spoke to a group of journalists at the New York Auto Show.  The following is from the interview attended by GirlDriver, USA.  Over the next few days we will post more of the interview.

GD: Do you think with younger generations, we will see performance end up in a museum?

I do not.  I really do not. It’s just like the discussion that says millennials don’t want cars because they’re getting their licenses later.  That was the party line.  Well they don’t have any jobs, they have no money and they can’t afford a car.  So they hate cars?  They don’t hate cars.  They love cars. 

GD: They are much more conscious of impact on the environment.  Are they going to turn on performance?

You can put a Volt in sport mode and have a blast.  That’s performance. We could make a small block hybrid that was really cool and really fast that doesn’t burn hardly any gasoline doing it for a very low cost.  I don’t think that would be a bad thing.  

GD: Are you going to do that?  

I would say the elements are there to create it and have fun.  At the end of the day [ vehicles] are an emotional purchase—always.  People don’t want to drive around in 20 second, 0-60 power.  That stinks. People like performance and I just don’t see that changing. Fun is fun.  We’re delivering that today that’s for sure.

GD: How fast are you going to be able to put the product into Cadillac and regenerate the brand?

I think a better question would be when do you think you are going to have the product right to be able to introduce it with high quality and technology that reflects what the brand should be? That’s the way we approach that.  I’m not on a timetable to say we’re going to have eight new products in two years and just hang on.  We’re trying right now the products we want to do because we can get ahead with our products of where the brand really is. That’s where we sit today and so we have to really have a discussion around what the brand health is when we talk about when we’re going to introduce products because we got to have a brand that can handle the product that’s being introduced.

GD: You’re talking about product and brand image.  And part of that was that the reason that Cadillac made the move to New York?

For sure. Johan’s job is not to go and develop an Omega platform for the CT6 Cadillac.  That’s my job.  Johan’s job is to take and use those products and change the brand perception of Cadillac into a brand that’s high on consideration lists so they give us a real shot at buying our cars.   

If we always did what we always did we’re always going to get what we always got. That was doing it out of Detroit. We’ve got to be able to change these things and that’s what we’re doing.  We’re giving it a shot.  There’s no downside to it, by the way.  There’s no downside other than you guys may say well that didn’t work.  OK?  So we’re going to keep trying.

GD: Is there a product push for them going to be on the crossover side?  

I’m not sure that I would say that but it could be.  because there are some things that are going to happen at the same time so I’m not sure there is a sequential cadence—we look at our product launch capability across all of General Motors not just Cadillac so I mean what we don’t want to do is have things happening in five places at one time and trying to get our supply base to do it and bring them up at the same time it would be a disaster so I’m pretty careful about that but that said Cadillac’s got a lot of priority.  From my people’s standpoint, it is to make it happen with the right timing, the right product with the right quality and performance. That’s where we’re focused.  

If you look at our portfolio at Cadillac today it’s got about half the entries that some of our competitors do and that’s a lot and so you look at what they are really doing and where they are successful and some of those are crossovers and some of them are cars that we don’t play in.  So here’s a car (CT6) that we need to do well with and I think we will.  But then there’s some crossovers beyond SRX that you know are probably pretty attractive for us as well.