GM exec says company is optimistic about 2003 sales

October 14, 2002

PHILADELPHIA -- The AP repoted that General Motors expects sales to be down this October compared to last year, but the country's largest automaker is optimistic that profits will grow next year, company executive John Devine said Friday.

"We still expect to see a very healthy U.S. industry next year. We don't expect to see a double dip. We still expect to see growth," Devine told about 80 people at a conference hosted by the University of Pennsylvania's Wharton School.

Devine, the company's vice chairman and chief financial officer, credited aggressive incentives with rallying car sales after the Sept. 11 terrorist attacks. The incentives have continued unabated; General Motors expanded its no-interest auto incentive program this week on most of its new 2002 and 2003 models.

Share prices have slipped for both GM and No. 2 automaker Ford amid concerns about sales and the economy -- a dip that Devine said should concern all automakers.

"Ford has obviously had their problems," said Devine, who worked for Ford for 32 years before joining GM. "If you looked at the numbers you'd wonder if the firm was going to survive. I think they will. I don't think we have to worry too much about that. But it doesn't make us feel too good either."

Falling share prices at Ford particularly hurt General Motors because investors link the automakers as "similar in business and similar in structure," Devine said. Whether that is correct, it is the reality, he said.

The two companies on Thursday announced a unique partnership to develop a new six-speed automatic transmission that would produce better fuel economy.

Devine retired from Ford in 1999 as executive vice president and chief financial officer. He joined GM in 2001.