Problems don't get smaller. When's the best time to solve a problem? The minute you know you have one.
Mary Barra is General Motors. She began working on a GM factory floor at age 18, and 46 years later, she's now running the company. Mary rose to CEO during one of the biggest safety crises in General Motors history. Since then, Mary has transformed the company into one that generates over 180 billion dollars in annual revenue. GM currently ranks number 23 on the Fortune 500, but today she faces a whole new set of challenges: fierce competition from China, shifting EV policy, and the rise of artificial intelligence and autonomous vehicles. After more than four decades at GM, Mary told us how she intends to steer the company into the next century. I sit down with her today for an hour to talk through all that and more for this episode of Fortune 500: Titans and Disruptors of Industry. We'll be back after a message from our sponsors.
Fortune spoke with Deloitte U.S. CEO Jason Girzadas on building a culture of speed and agility to drive innovation in large organizations.
There's a natural tendency for large organizations to become slow and deliberate, but in this environment, given the pace of technology and other competitive dynamics, there's also a need to increase agility, increase speed, and so there's a way through evaluating cultural drivers of the speed of decision making, the speed of communications, accountability for decision making that large organizations can be agile. It doesn't have to be an either/or. An entrepreneurial culture within a large organization really means that the speed of decision making is a priority, that the decision-making process, accountability, clarity of decision rights, a culture of making speed a priority can thrive. It's a CEO's job, a leader's job to make sure that individual units or divisions or groups or teams within a large organization feel that degree of empowerment and support and expectation that the speed of decision making is a priority. It's something that winning larger enterprises are intentional about.
Mary Barra, it is such a pleasure to be with you today in this gorgeous Cadillac facility you have. I'm surrounded by stunning cars that I want to buy.
I love to hear that. I love to hear that.
GM is 100 years-plus old, 185 billion dollar annualized revenue company. You are number 23 on the Fortune 500, number 39 globally of all the companies in the world—you're 39th in revenue generation. Such a pleasure to have you.
Well, it's great to be here, and it's so nice to spend some time with you. And I'm so proud of everything that General Motors has accomplished.
And you should be, and a lot under your tenure. So I want to cover a lot of ground. But first, I just wanted to start with 2026. The last two quarters have really had a strong financial performance in a year where that was not a given. You were combating tariff changes, an EV rollback schedule, a lot going on. So, what is behind the resilience that we're seeing in GM this year?
Well, I think first of all, I have to give credit to the General Motors team. Agility is their superpower now, and also we have a really strong product portfolio. I'm so pleased, and you can see some of them around us right now. And when you have a really strong product portfolio, it speaks to the customer, and they're choosing us. We have much lower than industry incentives. We're either usually one or two, and we're growing share. And so I think it really speaks to the strength of the underlying product that we have, and that really fuels everything. And then there's been predictions for the last several years, "Oh, this is peak. This is peak." I still think there's more room. We're seeing it this year, and that the customer, our customer for new vehicles, has been more resilient than I think people thought. I look at the metrics every couple weeks, and we still see strength in the market from a vehicle perspective.
It seems like customer demand, which was predicted to be waning, really hasn't felt that in the U.S. And that seems like Americans still love their gas-guzzling trucks and SUVs, of which you make them quite well.
Well, I do think, and one of the things that we have with our portfolio is giving the customer choice, whether they want a full-size truck or SUV, or even a small under-$30,000 crossover vehicle, and then we still have over a dozen EVs. So we really give the customer a lot of choice and reach a lot of pocketbooks, as Alfred Sloan would say. And I think that's one of the strengths, because wherever the customer is, we have a vehicle—and again, beautifully styled with the latest technology and safety features.
So, one thing I did want to address is just the affordability around cars. And I know GM makes a number of cars that are below the $50,000 threshold, but the average cost of buying a car is now hovering around that. For someone looking to buy a car, can you explain what's going on in the industry? Why are cars now feeling so expensive?
I think if you actually look at the rate of inflation over several years, vehicles are lower than that from a price increase perspective. But again, I think it comes to having a portfolio where I think last year we sold over 700,000 vehicles that were under $35,000. And so I think it speaks to the affordability. When we first released the Chevrolet Trax, which is a vehicle that's under 30, I drove it for a couple months. I loved that vehicle. It had safety features. It had great technology from a center screen perspective and everything that you could do to make your drive better. And so I think it's giving customers the features and making it affordable at the different price points for the functionality of vehicle that they're looking for.
EV ambitions for GM or the timeline for them at least has changed. A few years ago, it was all in by 2035. There were going to be lightweight EV models all over the United States. That timeline has changed. You're now thinking the transition to EVs will take decades, and it hasn't been an easy road. I'm curious why you think America has screwed up the EV transition. What did we do wrong? Because when you look at China, when you look at Europe, they're flourishing in EVs.
Well, I think it has a lot to do with the regulatory environment. So when you look at where all auto companies in the U.S. were a couple years ago, we were moving to a regulatory environment where you had to be making 40 to 50 percent of your vehicles as EVs by 2030. And so I think that's where we were all moving to. As the regulatory environment changed, that has really given customers choice. And I think one of the fundamentals also is what enables EVs is charging infrastructure. And although there were funds passed in the infrastructure bill a few years ago, it's been difficult due to permitting and a whole bunch of things to get those in the ground. We still see, though, every quarter the number of chargers goes up.
So I think over time, we still believe EVs are the end game from just the styling, what it enables, you know, that instant torque and never having to go to the gas station. And so I think regulatory, when you look at Europe and China, that's really what's driven it, along with other policies that enable the charging infrastructure to be robust. Because let's remember, when someone buys a car, for most people, it's the most expensive or the second most expensive thing they buy. They're very rational, and most people don't have multiple vehicles. If there's two people in the family, they have two vehicles, but they both need them every day to get to work to take care of their family. And so they're very rational about, "Is this going to meet my needs?" Not just in a typical week, but when I want to go on vacation, or I've got to go drop a child off at college, or I've got to go visit my parents. They look at it holistically, and that's why charging infrastructure is so important for people to have confidence to switch to EVs.
I think we'll get there. I think because of the policy in this country, it's going to take a little longer. And in the meantime, we have a great and very efficient internal combustion engine portfolio, and we have a very strong EV portfolio. And we'll have hybrids in the segments we think are important to give customers a full range, and they can pick what they want.
So I think you touch on an interesting point that must be at least a little frustrating as a leader, where every CEO who's running a Fortune 500 has to deal with Washington in some way, shape, or form. But your efforts are so also tied, it seems, to whoever's in the White House and what their agenda is. So how do you create a nimble org no matter who the president is? Biden was very pro-EV: "Let's create incentive programs." President Trump has not been as focused on that, and it's shifted the mission for GM, it seems. How do you navigate?
Well, I don't think it's shifted our mission. Again, we still think EVs are the end game. And when I've had conversations with President Trump, he's talked about wanting to give customers choice, not wanting to force them into something. So we can definitely do that. We do constantly remind all administrations we're a capital-intensive, long-lead industry, and so people have to respect that. But what we've tried to do is, again, have a robust portfolio of both, but then also the minute we start to sense something might change, what are these no-risk decisions or these no-regret decisions we can make to say, "Okay, how can we prepare for this?" We did that as we started to see the regulatory front changing. We also did as we started to see tariffs: what are no-regret moves, and then what are the shifts we need to make?
And that's where I think, again, our team, I'm so proud of them because they're so resilient in figuring that out. Like I said, agility is a superpower now, but it's agility partnered with looking over the horizon to say, "Okay, there's a variety of regulatory environments we could face. What's the best path forward that we're not totally out of business if it heads one way or the other?" And I think that's what you see GM doing. That's why, unlike many others who have just really abandoned EVs, we're not. We're really proud of the EVs we've had, but we're equally proud of the ICE vehicles. So we're going to continue to give that customer choice.
A few years ago, GM announced plans for all new light-duty vehicles to be electric by 2035. But shifting U.S. EV regulations, as well as strong international competition where newer auto giants like BYD are being boosted by national subsidies, are significantly slowing progress towards the goal. GM still says EVs are the end goal, but maybe not by 2035. Mary believes that American innovation, from AI-powered vehicle design to self-driving, will keep GM and the U.S. competitive as a manufacturing powerhouse.
There are other decisions that have been made in Washington that have helped the American car businesses quite a lot. We don't see the China electric vehicles all over the place in the U.S. like you do see in Europe and in China. I'm curious what you make of the rise of a company like BYD internationally. They have a huge chunk of the EV market now, but their prices are—you can't compete when China is subsidizing a car that low. I think for a $15,000 vehicle, you won't make money if you sell for that. So, first off, how long do you think the subsidies can last in China, and what's your long-term approach to how do you wait that out?
Well, I think first of all, in China, we've taken a long-term view. We've had a successful business in China for many years, and as we saw it dramatically changing with EVs and the growth of a lot of domestic auto manufacturers, we took the steps to restructure our business. I think we're the only Western OEM that is growing share ever so slightly and also returned to profitability. And so we think it's an important market to be in because, even though it's a little smaller than it was a couple of years ago, it's the largest EV market around the globe. But as we look at other markets, I've often said I'm a free trader if I have a level playing field, and there really hasn't been a level playing field. And I think that's something this country recognizes. They also recognize the importance of having a strong manufacturing base. I mean, I think many people realized through COVID being able to make things matters.
And so I think when I look at the policies in the U.S., many of which are no different than what China is doing for their own market, I think we're well positioned. Europe right now, I think, is still sorting. You've seen a lot of the established European OEMs really struggling. And I think from a U.S. perspective, recognizing and looking at the policies that are in China and here has been helpful for the U.S. auto industry to allow us to remain strong. But I also say we have to drive efficiency across the board. So we're always working on how do we give the customer more, how do we do it for less, how do we leverage technology, and that journey will never end.
And how do you decide when a market is worth staying in? China, you've had business there forever, it seems like for a long, long time, and you've made it profitable and you've made it work. But how do you decide, "Okay, I'm going to lean into this market and I'm going to maybe wait it out until the conditions get ripe and we can really take it over again"—I know you have a fruitful partnership there as well—versus like a Europe? How do you decide where to lean in and where to lean out?
We made the decision to sell our European operations to Peugeot at the time, PSA, and that was, I think, a really good decision for General Motors because at that time we were subscale, and we also saw a very big regulatory change happening in Europe. When you're subscale and you've got to make that investment, it becomes very difficult from a shareholder, our owners', perspective of is it a good use of our capital. So we think selling Opel ended up being a win-win-win: a win for General Motors, a win for PSA because they got more scale, and a win for the Opel brand and the team there. So I've often said I have no regret from making that decision. We stand ready. We export to Europe right now, primarily with EVs, because that's where that market's going. And I think as that market stabilizes, we can grow business there. So I think Europe now becomes an opportunity for GM in the future.
So as we look at the landscape, it does strike me that China has a clear advantage in some technologies that will really shape the future right now. Whether it's robotics and physical AI, batteries—they're very strong in chips. You're not necessarily stronger than the United States, but a lot of the things that GM utilizes and that just companies need to utilize, even energy, are really strong there. Do you worry for American companies in the long term when you see the strides that China is making?
Well, I think we as business leaders have to make sure that we're on that same pace and that we understand it, and we're moving at a pace that we're going to be able to compete, investing in technology. I'm really proud of the fact that in China, our vehicles, for instance from an infotainment perspective, were independently rated number one with the system we rolled out about a year ago and are rolling across the portfolio, competing with all of the big Chinese OEMs. So I don't think there's any reason we can't do that. I think we're making strides, and there's a tremendous number of robotics startups in this country as well. So I believe in American ingenuity and innovation, and I think we can compete. The fast pace technology moves right now, there's moments in time, but I bet on America continuing to lead in innovation.
One of the most exciting things, I know you've been in a Waymo. I know you've been in a self-driving vehicle. If you've never been in one, it is one of those futuristic things that you're just like, the world has changed. I might never have to drive again, or my kids might never have to drive again in the near future. I know you've gone through a journey with autonomous technology and some acquisitions and even some building of your own. Super Cruise is an amazing, not new line of business, but a growing line of business for you. I'm curious just how you think about the autonomous vehicle landscape and your decision to go into personal autonomous vehicles. When will that be a reality for the American consumer? When will I be buying a GM self-driving car that's entirely self-driving?
I'm done making predictions, because I originally predicted—
Yeah. That in 2019 we'd be on the road, and obviously autonomy—
Yeah, exactly. Autonomy is one of the ultimate AI and robotics challenges when you think about all the different situations that a vehicle goes through, and so I believe we'll get there. I believe from a personal autonomy perspective, GM will be one of the leaders, if not the leader, in personal autonomy. I'm excited that in 2028, that's when we've announced that we'll have our eyes-off-the-road highway on the Escalade IQ, and then we'll just keep expanding from there. I'm really proud of what we have with Super Cruise because what we've done with Super Cruise is we've really built trust. That system continually is very highly rated from just acting the way someone expects it to act, and we're proud of the safety, and that kind of gates everything we do. So I think we'll get there. We'll keep building with '28 of not only more areas that the vehicle can be operating fully autonomous, but then also adding at the same time across the portfolio. So it's going to be an exciting time.
Very. And like I said, so many people were predicting in 2019 that self-driving cars would be here. That last mile, it turns out, is really, really hard. Yeah, and I know how much you care about safety and trust, given all you've had to overcome here at GM. And we'll talk about some of those things. But I wanted to just ask one last question: do you think that personal autonomous vehicles will even be cars? There's talk of drones, flying drones. There's talk of all sorts of things, little pods. Does the vehicle of the future look different?
You know, I think it will continue to evolve, just like vehicles have evolved today from what they were even 10, 20 years ago. So I think they'll evolve for many different use cases that technology will enable. But that's an exciting piece of it, too. We have an advanced design team that constantly is imagining that future. So someday we'll have to take you in there.
I would love to see. Yeah, we'll take the camera crew.
There we go. Well, maybe some.
The next biggest upgrades to GM cars may not be in size, shape, or color. Instead, it might be what's running inside the vehicles. General Motors is building its future in code through autonomous driving vehicles like Super Cruise and connected support and control systems like OnStar. Both Super Cruise and OnStar are subscription-based services which provide high-margin revenue streams for the company, according to GM. A software business retains about 70 cents for every dollar it earns.
When you see a big technology shift coming, as a major company, you can either build or you can buy. And one technology you bought was Cruise, and a lot of money was spent there, and then ultimately Cruise was unwound. But it was like a Waymo competitor, and ultimately you decided, "You know, we're not a fleets company. We're not going to do robotaxis. We're going to do personal." But I'm curious about the learnings from an acquisition like Cruise that you had, and how other leaders should be thinking about when to acquire and when not to, when to let the future unfold before you make a big spend like that.
Well, I think with what we knew at the time, I would probably make the same decision over again. And we learned a lot, and a lot of the capability that we had at Cruise we were able to leverage as we work on personal autonomy. So, I think there's a lot that transferred. Much of the team is so committed, which is so cool to see, to achieving autonomous personal vehicles. And so I look at it. Yeah, were there changes I wish I would have made? But I would also say we were a generation back on technology, so the investment not only was that we were going to have to make a lot of investment in time to get to how technology and how autonomy is being done today, but then also it was a big decision. Again, we're stewards of our shareholders' capital, and when we looked at investing in internal combustion engine and EV vehicles, a fleet, like you mentioned, is not something we do today. We don't run a bus fleet. We don't run a taxi fleet. And so we started to look at what's our core competency, where do we have to go? And frankly, there's a lot of differences in autonomy from a robotaxi to personal autonomy. So that's where we're focused, because I think that's where our strength is.
And when you look at AI and robotics, this is clearly technology you've been utilizing for a long time, whether it's on the manufacturing floor or it's even in a job capacity to make roles that were unsafe done in another way. I'm curious how AI and physical AI or robotics has changed GM already, and how much change you anticipate happening over the next few years.
As you said, we have been on this journey for a long time, and it starts with our people. How do we use technology to make our people more effective, to get rid of jobs that are hard from a safety perspective, or create ergonomic issues, or are dirty or hard to do with the human hand, where so often the agility of a human is so important? So we look at technology as how do we use it to enhance what our team is doing, give them tools to take toil out, to improve quality and improve speed, because that just means we can give the customer more. So we're focused on both from a back office perspective—what are the tools that make everyone's life better and exposing everyone, so it's not something that's kind of scary; it's real, and like, "Okay, I get this. I can use this."
I was just in one of our manufacturing plants last week, and one of the skilled trades individuals was showing me how they're using AI to improve the speed of starting up new equipment faster. And I was just so amazed because now that it's in their hands, they're leveraging it. And then there's whole areas we're looking at, for instance in how do we do more work using AI from an aerodynamic perspective, which means we can explore more design themes to really perfect design. So that's exciting when I see those things. And then we're looking at other areas that will completely transform what we do.
So we're going to continue on that journey. Every other week, I deep-dive an area with a small team and I am like, "Okay, show me how you're using AI." And it's been fascinating. It's far exceeded my expectations for how quickly across the company, from the plant floor to R&D, they're leveraging the technology to make GM better.
