This is a partial transcript from "Your World with Neil Cavuto," April 19, 2005, that was edited for clarity.
NEIL CAVUTO, HOST: Never mind that John Devine had to report a record $1 billion-plus loss for General Motors (GM) in its latest quarter. Who couldn't blame the executive for looking for a little heavenly help today?
Earlier, I asked him if there was a spillover, with people feeling good in Rome and feeling good everywhere?
JOHN DEVINE, CFO, GENERAL MOTORS: Well, consumer confidence is funny. I think it's a fragile beast. We think it's still pretty good, but, listen, we'll take any help we can get.
CAVUTO: All right, now, do you read anything into the fact that, as soon as it was announced that we looked like we had a new pope, the markets moved up, or is that outside your purview?
DEVINE: It's outside my purview. I have enough to do at General Motors (search).
CAVUTO: All right. Now, that's something that could have used heavenly help. Nothing against you personally, John, but your company has experienced some hard times. Your stock has been getting battered.
Is it an issue of just the wrong cars at the wrong time or are consumers just between a rock and hard place?
DEVINE: No, I think it's different than that.
Really, it's an issue — we have had a tough quarter. Our issue right now is very much around North America. And we have been caught in a vice, frankly. And it's happened the last couple of years, tough marketplace. We're responding to that, but also very tough in escalating health care costs. It's really squeezed our profitability.
And when our production dropped in the first quarter, it's given us a very significant loss in North America. So, what do we do about it? We have to get the product right. That's the top priority in the company. We have actually increased our spending this year on product to make sure that we're providing all the resources we need to in this business. We have reworked our marketing strategy to get more of a volume — or value play, not just focus on incentives.
And frankly, the toughest part of what we have to do is still reducing our costs. Health care is the top issue we have.
CAVUTO: Right. I was going to say that.
And I am wondering whether you ever entertained going into bankruptcy to do that.
DEVINE: Absolutely not, no. There's no question about that.
I realize some companies have done that, but it is not our game plan, doesn't enter our mind. Our issue is, get our product right, focus on our marketing and get our costs right. So, we think, in the case of health care, there are things we can do. We have other areas of cost. That's what we have to focus on. That's what we have to do to turn around North America.
CAVUTO: There are those, though, who say, John, you know, your stock has gotten so cheap that, much like Chrysler a couple of decades ago, you're takeover bait now. Are you?
DEVINE: It's a risk. I think the issue for us is to make sure that we run our business well to get the stock price back up. We know what we have to do. But there's always a risk of that.
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