This is a partial transcript from Your World with Neil Cavuto, April 15, 2003, that was edited for clarity. Click here for complete access to all of Neil Cavuto's CEO interviews.
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NEIL CAVUTO, HOST: Never mind its first quarter earnings jumped a lot, the fact that GM is worried a lot about the full year was enough to pummel the stock and rattle investors. Earlier I caught up with the company's chief financial officer, John Devine, and asked what he doesn't see happening right now.
JOHN DEVINE, CFO, GENERAL MOTORS (GM): We are worried about where the economy is, and what is going to happen, in particular in North America. We had a great quarter, very strong quarter in the automotive business, up 10 percent. Very and strong quarter at GMAC, our financing unit. But obviously as we look forward we are concerned about where this economy is, where it is going, what is the impact on volume, what's the impact on the pricing environment? And again in this regulatory environment we want to be careful on the guidance side. So we thought caution was a good idea here. We want to be very open and transparent. So, basically, we did what we did. We did say though that the second quarter we think we can make at least a dollar, in the third and fourth quarter, we can be profitable. So if you look at the first half of the year, that's roughly $3, not a bad start, $5, though, is a tough target in a today's environment. And we wanted to be cautious and careful in how we describe that.
CAVUTO: Would any of your prospects improve if the president got his way on that tax cut?
DEVINE: We think the stimulus opportunity is very important here. I think a jump-start in this economy we think is essential for the overall economy, and certainly for the auto business. We are obviously feeding this business now with high incentives. So a higher level of growth would help a great deal. And frankly it has been warranted for some time. So we a big supporter.
CAVUTO: So the fact that the president now will likely see the taxes that he wants halved from what he originally proposed, does that concern you?
DEVINE: Sure, obviously we would like to make sure it is enough. I think going back to the well here would be unfortunate. We think it is a opportunity, it's a window today to get this economy jump-started. It is weaker than we would like to see, frankly. So I think we would recommend that we would do it in a full level which the president views at a higher level in Congress right now. So we would support the higher level. And frankly we think this economy can handle it. So we would vote to get it done and get it done now.
CAVUTO: Let me ask you a little bit about the DirecTV, GM-Hughes Electronics sale to the point, some of your own investors were saying you could have done better. And you are not the blame, of course, for some other potential bidders simply opting out of the process. Any final comments on that sale?
DEVINE: Well, I think we could not have, this is a good deal for GM, a good deal for Hughes, a good deal for News. This was not - this was the best deal possible for our shareholders. There was not another deal. Some of the shareholders, I think, looked to say, could we have somebody buy the entire company, pay a big tax bill? Frankly that was not an option. So we think this was the best deal available. We think it is a good deal, good for us, good for the H shareholders and good for News.
CAVUTO: Did you ever look at that, John, as an option, selling the entire company?
DEVINE: We looked at every option. So there is nothing that slipped through. And again, we are very pleased with the deal. We think it's going to work for the Hughes shareholders in particular, the opportunity to go from a tracking stock to an asset stock, the chance to separate from GM and be part of what we think is a terrific opportunity with News as the leading shareholder. And the business prospects for the Hughes business, which had been getting better, they just at a very strong first quarter they he announced yesterday, that combination we think is terrific. And we think the H shareholders are going to agree.
CAVUTO: In the meantime, it is still very difficult to sell cars without incentives, isn't it?
DEVINE: It is. Unfortunately it is not only cars, I think if you look at electronics, you look at home furnishings, whatever you are looking at these days, I think incentives in one form or the other, are part of the business today, at least in this country. So we had better get used to it. Would we like them to be lower? Sure. But again, we think this economy is going to have to get stronger for that to happen. Our the products are getting stronger. And the stronger they get we think that will help. But that said, we think incentives are not going to go away. And what we are doing on, continue to work on the cost side, continue to work in the product side to reduce that impact.
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