GM’s Ed Peper: ‘It’s All About Total Cost of Ownership’

Edward Peper

US Vice President of Fleet and Commercial Sales, General Motors

Ed, tell us what is the company’s focus right now. 

Our focus at GM is real­ly on all of the new prod­ucts that we have com­ing to the mar­ket­place. By the end of 2013,70 per­cent of our prod­ucts will be either new or refreshed. For us that is so excit­ing. Launch­ing these prod­ucts is so impor­tant to our over­all busi­ness and that is a huge focus for us right now.

Fleets are work­ing hard to meet nec­es­sary emis­sions and fuel econ­o­my man­dates for 2015 and out into 2025. And they’re explor­ing how they’re going to get their fleets to hit those marks. We rec­og­nize their need to meet these stan­dards and we are work­ing on prod­ucts and tech­nol­o­gy that can help them meet the nec­es­sary mile­stones.

We believe in ener­gy diver­si­ty. There is not one sil­ver bul­let when it comes to fuel solu­tions for fleets. For exam­ple, sev­en of the eleven mil­lion vehi­cles that are run­ning in North Amer­i­ca on flex-fuel are Gen­er­al Motors prod­ucts. We have 21 vehi­cles in our line­up that have E85 capa­bil­i­ties. We see that as a real­ly great solu­tion to reduce our depen­dence on for­eign oil and improve fuel econ­o­my. In addi­tion to that, we see CNG get­ting big­ger all the time. The price ver­sus gaso­line is very favor­able right now. When fleets are look­ing at total costs of own­er­ship, fuel costs are so impor­tant to them.

Three years ago, about 16 per­cent of our vehi­cles on the road got 30 miles per gal­lon or bet­ter, and today that num­ber is 40 per­cent. We are mak­ing great strides, and I think we prob­a­bly have the most diverse choice of fuel-sav­ing tech­nolo­gies of any OEM out there and we like that posi­tion.

Let’s talk about the ser­vices that GM pro­vides fleets after the sale.

We think it is crit­i­cal­ly impor­tant to take care of our cus­tomers. There are three pil­lars that we focus on at GM Fleet and Com­mer­cial. One is to pro­vide great prod­ucts. Two is to pro­vide very inno­v­a­tive busi­ness solu­tions for the com­pa­nies that work with us. Three is to pro­vide the best own­er­ship expe­ri­ence that a cus­tomer can have in the busi­ness. We have a Fleet Action Cen­ter that is not just a call cen­ter; they pro­vide coun­sel and advice and answer ques­tions for all of our cus­tomers. The Fleet Action Cen­ter has a 98- per­cent cus­tomer sat­is­fac­tion rate. When you look at our order-to-deliv­ery -time, as mea­sured by Bobit, we have achieved the best on-time deliv­ery of any OEM for four con­sec­u­tive years, and we think it is prob­a­bly going to be five. Time is mon­ey and get­ting those vehi­cles to the fleets and com­pa­nies on time is very impor­tant. I think we have the most exten­sive group of ser­vice per­son­nel out in the field meet­ing direct­ly with cus­tomers to help them with all of their needs. We’reable to pro­vide the best expe­ri­ence for com­pa­nies in the mar­ket­place today. 

How do your resid­ual val­ues com­pare with your com­peti­tors?

If you look at Vincentric’s study for total cost of own­er­ship, our large vans, the Chevro­let Express and GMC Savan­na, have been award­ed the best total cost of own­er­ship in the mar­ket­place, includ­ing the best resid­u­als for large vans. We have had the best resid­u­als ongo­ing for our pick­up trucks, light duty mar­ket as well. And it con­tin­ues with the new prod­ucts that we are launch­ing. On our new 2014 Impala, the resid­u­als are the high­est that we have seen on any pas­sen­ger car that we have ever offered. Resid­u­als are a big part of that total cost of own­er­ship and we are proud of the resid­ual per­for­mance, and the improve­ments that we have made the last sev­er­al years. The great news is we are going to get even bet­ter going for­ward.

 

Let’s talk more about the Impala, and the 2014 fleet line­up.

The 2014 Impala, what a phe­nom­e­nal vehi­cle! It is big, beau­ti­ful, and it is also very fuel effi­cient. There are three engine choic­es with the Impala this year includ­ing an eAs­sist engine mod­el, which achieves 35 miles per gal­lon on the high­way. With the trunk size that it has and the capac­i­ty, this is going to be an unbe­liev­able fleet vehi­cle. In addition,new for 2014 is the Chevro­let Cruze with clean diesel tech­nol­o­gy. It gets an EPA-esti­mat­ed 46 miles per gal­lon on the high­way, which for non-hybrid mod­els, is the most sig­nif­i­cant fuel econ­o­my  of any vehi­cle in the mar­ket­place today. 

We also intro­duced the all-new 2014 Chevro­let Sil­ver­a­do and GMC Sier­ra pick­ups. These trucks have out­stand­ing fuel effi­cien­cy. The V8 5.3 liter engine in the Sil­ver­a­do and Sier­ra will have bet­ter fuel econ­o­my than the V6 Eco­Boost engine that is in the Ford F150. To have all of that pay­load, pow­er, torque, capac­i­ty and bet­ter fuel econ­o­my with a V8 ver­sus the Ford V6 is a huge com­pet­i­tive advan­tage. We think fleet buy­ers and retail buy­ers both are going to absolute­ly love these new pick­ups; they are just out­stand­ing. As you can see we are excit­ed about the new Sil­ver­a­do and Sier­ra.

One last thing…. 

Resid­u­als con­tin­ue to be extreme­ly impor­tant to them because it is all about total cost of own­er­ship. We have to be able to pro­vide that excep­tion­al val­ue with every vehi­cle that we sell to fleets. That is what our goal is. I think it all con­tin­ues to cen­ter around cost of own­er­ship, but there also is an intan­gi­ble which is the cus­tomer ser­vice that we can pro­vide. We have many com­pa­nies tell us that our team does a mag­nif­i­cent job of get­ting the vehi­cles to them on time. If they have any issues, we jump on it right away and they get them ser­viced. If they have ques­tions and call our team or call our fleet action cen­ter, we are very respon­sive. Those are the kinds of com­ments that we want to hear because they build the loy­al­ty that is going to con­tin­ue to take our busi­ness upwards and for­wards going in the future. 

BIO

Ed Peper is the US Vice Pres­i­dent of Fleet and Com­mer­cial Sales for Gen­eral Motors. Pre­vi­ously, he was Gen­eral Man­ager, Fleet and Com­mer­cial Oper­a­tions, has served as Gen­eral Sales Man­ager for Cadil­lac, and has held sev­eral lead­er­ship posi­tions at GM through­out his career.

ed.j.peper@gm.com

 

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