WHEN: Today, Tuesday, October13th
WHERE: CNBC's "Fast Money Halftime Report"
Following is the unofficial transcript of a CNBC EXCLUSIVE interview with General Motors CEO Mary Barra and CNBC's Kate Kelly on "Fast Money Halftime Report" (M-F, 12PM-1PM ET) today.Following is a link to the interview on CNBC.com: http://video.cnbc.com/gallery/?video=3000431906.
All references must besourced to CNBC.
Scott Wapner: We are back. U.S. auto sales climb to a ten-year high last month and GeneralMotors played a large role in the jump with sales up more than 12%. The stockhas seen a 10% rally this month alone. So can that momentum continue? Our ownKate Kelly joins us now with GM CEO Mary Barra. It is an interview you will seeonly here on CNBC. Kate?
Kate Kelly: Hey, Scott.Thanks so much. Mary Barra, CEO of GM, thank you so much for joining us. It'sreally a pleasure to be talking with you. Let's talk about why we're here.We're at the Fortune Most Powerful Women's conference. Later this afternoon,you are going to be spending some time with high school students doing some mentoring. What is your philosophy on mentoring young women in particular thosewho might be interested in stem fields and engineering specifically, which isyour background?
Mary Barra: Right. Well Ithink, first of all, I want to create interest for everyone – for science,technology, math and engineering because it's so important. There's not asingle industry that you can be involved in where technology isn't having animpact. So science and math at that middle school, high school is soimportant because it's a foundation to take you wherever you want to go. Sothat's my message for young women and young men.
Kate Kelly: Do you think schools are doing a good enough job teaching math and science to kids? Andespecially peaking girls' interests? Because I know that learning stylesbetween genders are different. Is there room for improvement?
Mary Barra: I think there is.I mean I think there's been tremendous advancements in education. So I certainly don't want to say that good work isn't going on, but I think having a 16-year-old daughter myself and also spending time around a lot of middle schooler and high schoolers, I just think really helping paint that connection between what taking science and math and what that means now and how that's going to translate ten years from now, 15 years from now. That's where I thinkwe can do a better job.
Kate Kelly: So when you think about it, you have a really diverse resume. I mean people think of you as anengineer, which of course you are. But you also ran HR, you also did a spell ininternal communications. Did those skills, those various skills come into playin terms of the ignition failure crisis that you faced shortly after gettingyour current job? How did that range of experiences give you a hand?
Mary Barra: Well, I think it's helped me in all aspects of my career, and really in communications, just understanding the power of having a good message and so people know what's going on so you can motivate them, so you can keep them informed. Because people, I think, will act and support you if they understand what's happening.So communications was vitally important and something that we did regularly. Iwould also say from an HR perspective, I really – you know, through my careerat General Motors, have gotten to know the men and women of General Motors. Andthey care. And they want to do the right thing. And so a lot of it is justgiving them the tools and the systems and the processes to do that. And so, youknow, both were very important.
Kate Kelly: So Volkswagen – I have to bring it up – is going through a crisis of its own right now. Obviously their CEO has already been replaced, and they've got some huge damage to mitigate in terms of what happened with the emissions cheating. Without askingyou about them specifically, do you have advice for a competitor who findsthemselves in turmoil like that, especially early on in the job?
Mary Barra: Well, you know, I think when you look at that type of situation, whether it's in the auto industry or across any industry, the factors are different. So it would bepresumptuous for me to think I could give advice. But what I can say is, youknow, at General Motors, what we focused on when we had the challenges lastyear was first putting the customer at the center and really looking and doing everything we could to support the customer. And we took several steps to dothat. The second was being transparent. Of making sure, again, thatcommunication focused, to make sure everybody understood both inside andoutside the company, what was happening. And then third and more lasting, wasto make sure we made the changes necessary to do everything in our power tomake sure it never happened again. So those were the principles that guided usand really became foundational in the company. And, you know, we're leveragingthat as we move forward with a true focus on the customer.
Kate Kelly: Let's talk about your core business in North America.
Mary Barra: Sure.
Kate Kelly: So, sales are still growing and in line with the industry. But there's a concern, I think,even though the economy has improved, that things may be topping outindustry-wide. How do you continue to grow sales? I know you announced sometechnological innovations last week in terms of driverless cars, a car-sharingprogram. Are those bedrocks of your future growth? How do you see North Americaas a medium to long term story?
Mary Barra: Well, you know,first as we look at it now, this has been a slower recovery, and so generally what that means is we didn't over correct so it won't be – you know, there isn't a drop coming. But having said that, we do know we are in a cyclicalbusiness. So we are focused on the fundamentals of having the right products and making sure we have profitability in the core and then looking at adjacencies. Whether it is after sales or our GM financial business. But thenon top of that is really looking at where mobility is going. And we havea tremendous asset with OnStar and the 4G LTE connectivity that we have in thevehicle right now, and we have it across a broad range of products in NorthAmerica. Going to Europe, we are launching it right now. Already in China, strengtheningit. And we'll even be launching that in South America. And so when you look athaving the right technologies to build on however people are going to get frompoint a to point b, that's what we're focused on. Because General Motors willbe a part of personal mobility as we move into the next you know, two, three,four, five years.
Kate Kelly: So you mentioned China. When you think about some of your overseas markets, what's at the top ofyour worry list?
Mary Barra: Top of my worry list. Well you know, I think each – we're a cyclical industry. And so you know,at all points of the cycle, you have got to be looking at where is the strengthof the business, how are you planning, how are you looking over the horizon tomake sure you're going to have the right product portfolio and the rightefficiencies in that market. So right now, when we look at South America,obviously, a very challenged market from a macro-economic perspective. So howare we driving efficiency? We're on several steps that we've taken to driveefficiencies in the business. And also looking at how do we make smartinvestment? Because one thing we know about South America is when the marketcomes back, it comes back quickly. I think China is a little bit of a differentstory in that China we've had, you know, record years of growth and reallydriving growth for the globe. But now, we still think there will be significantgrowth over the next 10 to 15 years. We think it will be about 10 million unitswhen you put that on top of an already large market of 24, 24 ½ units global –China volume, it's very important that we have the right product portfolio, but we also have a business that can respond quickly from, you know, taking the ups and the downs and still driving the right margins. Because at the end of theday, we need to demonstrate and we will continue to do that, that we can seemargin improvement in all aspects of the cycle.
Kate Kelly: Mary Barra, thank you so much. It's been a pleasure talking with you. Scott, back to you.
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