DETROIT — General Motors Co. has embarked on a monthlong effort not just to reintroduce itself to the public — but also to sell itself.
To pitch its initial public offering, tentatively slated for Nov. 18, GM will position itself as a new company with a leaner balance sheet and high-tech, fuel-efficient products such as the Chevy Volt extended-range electric car.
But will investors and consumers buy it?
To succeed, GM's stock must attract big investors and maintain value and momentum when it becomes available to the general public. That's the only way the U.S. Treasury will be able to recoup the $50 billion taxpayers gave GM.
But GM is pitching itself to a public with a fresh memory of its bankruptcy.
GM has pointed to the Volt as the main example of its promising future technologies. But the Volt launch in early November must be glitch-free to convince Americans that GM has really changed.
The Volt launch and the IPO come 16 months after GM's emergence from Chapter 11 bankruptcy — in both cases, more quickly than many thought possible. But those 16 months have been tumultuous, with several executive shake-ups and three CEOs. And the work continues.
"I think it's premature to say we've completed the turnaround," GM CEO Dan Akerson said. "We can't live in the moment. We have to look forward."
But first, GM's road show. Two teams of executives have been meeting with investors in major cities in North America and Europe. They'll sell the stock. They'll sell the Volt. And they'll sell themselves.
The next month holds the possibility of both elation and reality checks for General Motors executives.
Count on celebration as GM returns to the stock market that dumped the company when it went bankrupt last year. But before that, executives must sell GM to initial investors in a "road show." That means meeting after sobering meeting, in which executives must own up to the company's remaining shortcomings and promise to fix them.
That's a posture executives are used to by now.
GM CEO Dan Akerson said his team is already looking beyond the immediate future.
"We have a lot of work in the near to intermediate term, across a wide variety of efforts. But I can assure you that we're thinking well into 2011, '12 and '13," he said. "We're formulating strategies that will lead, I hope, to the long-term success of General Motors — not next quarter or the quarter after."
GM must sell those strategies to investors. Three people familiar with GM's IPO said main investor concerns include GM's money-losing European sales region, its product plans, its unproven management team and its pension-funding obligations, which amounted to $26.4 billion on June 30. To help, GM said it plans to contribute $4 billion in cash and $2 billion in common stock to its pension plans. The move was part of a broader $11 billion plan to clean up and prepare its balance sheet for the IPO.
A peek at General Motors' road-show pitch to market its stock shows the company plans to focus on its sales potential in emerging markets such as China.
In a 10-minute video, viewable at http://retailroadshow.com, chief financial officer Chris Liddell points to GM's sales outside North America, which make up two-thirds of its total sales. Top emerging markets in Brazil, Russia, India and China — where GM and its joint-venture partners are tops in sales — are projected to increase sales by almost 14 million units by 2014, Liddell said.
"That growth alone is more than the total vehicles sold in North America last year," he says in the video.
Liddell is leading one of GM's two teams on its road show to North America and Europe, where executives will meet with investors to persuade them to buy stock in GM's $13 billion initial public offering.
Retailroadshow.com says the GM IPO is expected to price "on or about Nov. 17."
The IPO will be in the range of $13 billion, GM announced last week, and the target share price will be $26 to $29. GM plans for the initial public offering to reduce the U.S. Treasury's stake from 61 percent to just over 40 percent.
GM predicts a third-quarter profit of between $1.9 billion and $2.1 billion with sales of about $34 billion.
Coincidentally, the biggest company effort during the road show is likely to be the production launch of the Chevrolet Volt, with the first customers to receive vehicles by the end of next month. The Volt gets 25 to 50 miles of battery-powered driving before switching to a gasoline-fed generator.
GM has already used the Volt as a hint of the company's future product plans, pointing to the Volt 21 times in the latest version of its IPO registration, usually as an example of its commitment to new, green technology. That's despite the Volt's low-volume forecast for the vehicle's future. GM says it will build only 10,000 Volts by the end of 2011 and 45,000 in 2012, although product chief Tom Stephens has said those numbers could increase. By comparison, GM has sold 163,000 Chevrolet Malibus so far this year.
"I think the Volt is clearly representative of what this company can do when they set their mind to it," said Joseph Phillippi, principal of AutoTrends, a consulting company in Short Hills, N.J.
North American president Mark Reuss has said customers interested in the Volt's fuel efficiency may convert into buyers of the Chevrolet Cruze compact car.