Five Ways to Tell New GM Is The Real Thing

In its IPO sales pitch, General Motors claims it has a new corporate culture. But does it, really?

GM admits Old GM corporate culture was a contributing factor in the company's eventual bankruptcy last year. That makes it a valid issue whether GM really means it, when it says -â€" for the umpteenth time -â€" that it really is a New GM, not to be confused with the Old GM.

In bankruptcy restructuring last year, GM in effect finally admitted that is still really didn't know quite what to do with Sweden's Saab, after a total of nearly 20 years of owning first half, and then all of Saab. GM dropped Saab, plus Hummer, Saturn and Pontiac. "Old GM" would have hung onto those brands past the point where they made sense any more. Not only that, the company would have kept them, even though it didn't have a realistic plan for turning them around and making them relevant again. Come to think of it, that's exactly what Old GM did.

2. New GM Sticker Prices Actually Mean Something

This is a work in progress, but GM is doing the best it's done in years at trying to rein in discounts, euphemistically called incentives. According to Edmunds.com, GM still had an average incentive per vehicle in October of $3,437, but that was down from $4,382 a year earlier. GM, Ford (F) and Chrysler are all trying to keep incentives down by keeping production in check. In the past, the car companies resorted to incentives and sales to rent-a-car fleets, because they built too many cars and trucks for too few buyers.

3. New GM Financial Reports Are Short on Asterisks

This is also in relative terms, but New GM financial reporting looks less and less like what one Wall Street analyst once memorably called, "a smorgasbord of special items." Old GM had a strong tendency to report its numbers how they would have looked, instead of how they actually looked, in light of a long string of asterisks and one-time special items. The thing was, sometimes those special items represented billions of dollars. Besides, it seemed like "non-recurring items" occurred every quarter -- just different ones. The "New GM" has simpler-looking numbers. There's still a heavy black line in its financial reports between New GM and Old GM, but as time goes by, Old GM results will recede.

4. New GM Is Getting Globalization Right At Last

GM and its competitors have been trying to achieve globalization since at least the mid-1980s. The idea is to build a bunch of different-looking models and save money, by building several models on the same platform. Using common engines and common parts underneath the skin saves development costs and creates quantity discounts for parts. Today, GM says it is both saving money on global platforms, and charging more money for new, "global" cars and trucks as they are introduced.

5. New GM Has New Faces in Charge

No matter how competent they were or how committed to genuine change, it hurt GM's credibility when it was still being run by GM lifers like former CEO Rick Wagoner, or even the highly regarded Fritz Henderson. Understandably, people outside the company found it hard to accept that the same executives who were in charge when the company got in trouble were the right ones to fix it. GM's new CEO Dan Akerson is an outsider from the telecommunications industry, who succeeded another outsider from the telecommunications industry, Ed Whitacre. Old GM re-shuffled a lot of the same executives from division to division -- so often that they didn't have to live with the long-term consequences of their decisions. From the outside looking in, it didn't look like there was a whole lot of accountability.

Related:

• GM Dumps Saab; Are Hummer and Saturn Next?
• Push Comes to Shove: Wagoner is Out at GM
• GM Raises Sights for IPO

Photo: GM