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GM TradeXchange Launches Ahead of Schedule

21 December 1999

GM TradeXchange Launches Ahead of Schedule; GM and Commerce One Accomplish Auto Industry's First-Ever Internet-Based Auction

    WALNUT CREEK, Calif.--Dec. 20, 1999--Commerce One today announced that General Motors Corporation on Friday successfully conducted the automotive industry's first-ever Internet-based business-to-business auction on its GM TradeXchange web site, months ahead of schedule.
    In addition, GM buyers began purchasing on GM TradeXchange this week through the web site's catalog function. Two hundred thousand catalog items are currently available to GM and its suppliers through five participating companies. GM TradeXchange is powered by Commerce One, the global leader in business-to-business electronic commerce.
    "We said we were going to move quickly from concept to reality and we're doing it," said Harold R. Kutner, GM's group vice president of worldwide purchasing and North American production control and logistics. "It proves that we're serious about being an innovator and leader in the rapidly evolving e-business sector."
    The auction, conducted as part of GM's Global Asset Recovery Program, involved 108 supplier companies registered to bid on material "live and in real-time" on the exchange. Auction items offered in today's session were stamping presses. "The online auction was a win-win for both our company and GM," said Gary Ball, president of Ball Machinery Sales, Ltd., in Guelph, Ontario, Canada. "We were able to purchase material online without having to take time away from the office. This increases our productivity and reduces cost."
    GM also processed its first purchasing orders totaling more than $500,000 in maintenance, repair and operating equipment on the exchange this week. Supplies were purchased from online catalogs posted on GM TradeXchange by W.W. Grainger, Boise Cascade, Corporate Express, Direct Sourcing Solutions and Graybar. The catalogs on site contain more than 200,000 available items for purchase.
    "Although there's still much more to be done in terms of adaptation and process improvements, the message is clear - we've gotten started and we're transacting business-to-business e-commerce on GM TradeXchange," said Kutner.
    According to industry figures, it costs approximately $100 to process and manage a purchase order through conventional means. By processing purchase orders via the Internet, the cost can be reduced to around $10 per order.
    Perhaps the biggest benefit of GM TradeXchange to suppliers is its potential to significantly streamline their purchasing operations. The program's automated order processing will lead to lower operational costs. GM and Commerce One handle all ongoing software upgrades and maintenance of the ordering system.
    GM TradeXchange is part of the Commerce One Global Trading Web, a worldwide network of business-to-business e-commerce portals. It operates on Commerce One's MarketSite global portal solution, which automates supplier transactions from order to payment and utilizes Commerce One's BuySite electronic procurement application.
    "Together, GM and Commerce One are moving at Internet speed to bring the value of electronic commerce to the automotive industry," said Mark Hoffman, president and chief executive officer, Commerce One. "While others are talking about online trading, we're actually doing it."
    GM TradeXchange will allow participants to conduct transactions three ways: through an online catalog, an online bid-quote process, or an online auction. The online catalog and online auction were successfully run on the site this past week, while the online bid-quote process will be operational the first quarter of 2000.
    Most e-commerce experts expect business-to-business purchasing via the Internet soon will far exceed the volume of online consumer purchases. In addition, industry analysts forecast that auction sales will grow exponentially by 2002. According to Forrester Research, business-to-business auction sales will increase from $8.7 billion in 1998 to $52 billion in 2002.
    General Motors Corporation, founded in 1908, is the world's largest vehicle manufacturer. GM designs, manufacturers and markets cars, trucks, heavy-duty transmissions, and locomotives worldwide. In 1998, GM generated revenues of $161 billion on its global operations, which included sales of 8,165,000 cars and trucks. GM vehicles are sold in nearly 190 countries and the company has manufacturing operations in more than 50 countries. GM employs about 391,000 people worldwide.
    Commerce One is the leading provider of electronic commerce solutions that dynamically link buying and supplying organizations into real-time trading communities. Commerce One is based in Walnut Creek, Calif.

    Note to Editors: Commerce One, BuySite, BuySite Enterprise Edition, BuySite Hosted Edition and MarketSite are either trademarks or registered trademarks of Commerce One. Other product and company names mentioned herein might be the trademarks of their respective owners.