‘Build where we sell, source where we build’
MANILA, Philippines—A highlight of the Philippine media’s visit to the Bangkok Motor Show was a conversation with Martin Apfel, General Motors president for Southeast Asia; Roberto Rempel, GM’s global vehicle chief engineer; and Albert Arcilla, president of The Covenant Car Company Inc. (TCCCI), which is GM’s Philippine distributor. Based in Bangkok, Apfel discussed the new Chevrolet Colorado, the performance of Chevrolet in the region, and why GM doesn’t show Batmobiles.
Question: One of the selling points of the Colorado is the bold design. Apart from that, what are the selling propositions of the new pickup?
Martin Apfel: The way we conceptualized the Colorado, there are two pillars for this truck. First, it is 100 percent Chevrolet, with DNA that defines a Chevrolet truck that’s right for its time. I doubt there’s anything as pretty as this on the market. Second, we aim to build the best truck, benchmarked against competition in everything that matters.
Rempel: GM is a tremendous engineering company for trucks. We understand trucks. Our truck will be very refined. You will feel the difference in our trucks, and yet it will not lose sight of what a truck should be.
Question: Will you be developing MPV and SUV variants of this platform?
Apfel: Is that a recipe for success? Yes!
Question: How is the growth of GM in Southeast Asia?
Apfel: Thailand January-February is 80 percent stronger than 2010. In Indonesia, we have outpaced the industry by practically 100 percent. Those numbers sound impressive, because they come from a low base. But it tells you our trajectory. Philippines—I would say—in pure growth numbers, not yet as strong as the other big markets, but also growing. We have a great partner in TCCCI. They’re thinking very creatively in how to reach the customer.
For example, Chevy certified used cars—that helps us tremendously in Thailand. We are going to see the first application of that in the Philippines this year. We need to get better on the service and parts availability side, and improve the predictability of the cost of ownership.
Albert Arcilla: We’re really excited, as we are in sync with regional objectives. We will be choking with new messages and new products this year and next year. When we all go back to the Manila Auto Show on April 7, I’m sure the Filipino motoring public will appreciate Chevrolet even more. The growth has been 54 percent in 2010, in just one year (under TCCCI).
Apfel: I promise you, you will see me on April 7 at the Manila Auto Show, and my hand will be ready to pull back the cloth on a new vehicle.
Question: How will the production truck be different from the concept truck?
Apfel: This is the 42nd concept car under Ed Wellburn. Ed said he wants to build concepts that are street-ready. General Motors does not show Batmobiles. Remember those words—they are a good indication of where the production truck will go.
Local content: There are competing and combating groups in motoring, and many in media and in government tend to be swayed by favorable policies. Particularly: local content.
Question: Do you have a standing policy for local content? How much percent of the Colorado or future Chevy products will be composed of locally sourced parts?
Apfel: Our policy is twofold: Build where we sell, and source where we build.
Previously, GM had been looking at the thresholds. If the law said 40 percent, we would do 41 percent, 42 percent, 43 percent and that was it. We’ve changed that concept. We’re seeing localization up to the level where it makes sense for the product; jumping the fence is not enough.
If you look at the production model of the Colorado, I would be disappointed if it will be below 70 percent Southeast Asian content. I’ve had conversations with the representatives of the Philippine government. My takeaway is this: the rules that were intended to attract manufacturers to the Philippines have not done what was promised. So the volumes and the localization is far below what was hoped for, and maybe even committed.
Our offer is: how do we find a good mix of suppliers? Not only have big dogs in there, global suppliers, but start to develop capable local suppliers. I like family-owned businesses that have track record in the industry for delivering on time, that have the engineering capability to work on improvements with you. They may not do the exact part that you’re looking for, but they have the foundation in place. They are trustworthy, and you can build a partnership with them.
My proposition is always: if you want to do something that shows economic impact in the Philippines, then work on developing on a strong supply base. We’re already sourcing in the Philippines. We can build on some experience; we need to broaden the appeal. It’s our opportunity to work with suppliers worldwide, and match them with local partners.
Question: You’re heading for a divorce from Isuzu, as far as pickup products are concerned. How do you hope to avoid a battle for ownership of the product?
Apfel: I don’t see a divorce. We’ve always been competing in the market; we don’t see dual dealerships of Isuzu and Chevrolet. We enjoy a great working relationship with Isuzu in South America and South Africa. Partnering means that when it makes sense, you work together. If it’s a mature partnership, both can decide, and it doesn’t mean that if a certain product is discontinued—for example, the contract assembly of Isuzu trucks for export in our plant—that it has any negative impact on our relationship.
Isuzu chose not to continue the contract assembly of their product in our plant. I will fill that plant with lots of Chevrolet trucks.
