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With a sales record that commands respect, GMC's Terry Johnsson talks about the factors that brought them to top
Ashley Mark Hammond

At the end of a hard day spent toiling at the top of General Motors Corporation's (GMC) Middle Eastern division, regional managing director Terry Johnsson likes nothing more than to sit down with a cigar and listen to some Miles Davis. But there's certainly nothing 'kind of blue' about this man's persona or his work environment. To say that the Gulf is the current golden region in sales is somewhat of an understatement, as the figures show. Since Johnsson's appointment in May 2004, sales have rocketed, though he says with modesty that his arrival into this equation is somewhat of a fortunate coincidence.

Total sales in the second quarter of 2006 (April, May and June) saw 36,173 units drive away, bringing the first half sales performance to 62,629 units, an increase of over 20 per cent on the same period last year.

In 2003 the overall yearly sales stood at 50,000 units, in 2004 it reached 88,000 and 2005 saw GMC comfortably surpass the 100,000 milestone to touch 113,000 units. After such a good start, this year's expectation is set at an excess of 130,000 units.

Speaking at the launch of the new 2007 Yukon at GMC's Ghubra showroom, Johnsson, with a grandfather who was a Swedish sailor settled in Australia, and parents who worked as teachers in India, where he was born, told us exactly what it was like to be working for a company that is going places.

What's the key to your success and is the Middle East car boom as big as it seems?
It's true, there aren't too many places on the planet growing this fast and we need to make the most of a unique window where factors such as the market environment and a young population of car buyers are all in our favour. Take the demographics and the prosperity coupled with a completely revamped portfolio of cars, and it ends up being a great business formula.

Since you started, sales have blossomed. Is it all down to you?
My arrival in 2004 and sales suddenly shooting up have very little correlation. I'm fortunate to be surrounded by an amazing team. I don't think I have ever had so much fun working with such a young and dynamic set of people who are able to combine passions of the car industry with connecting to the customers so naturally. But of course it’s always fun when you are winning.

The business is easy when you get a couple of things right. We have brought a wealth of fresh products to the consumer, 26 new launches in 24 months. It means a lot when you bring in iconic brands like GMC, Chevrolet, Cadillac and something new like Hummer. You already have something promising there but when you marry this with good retail partners who are keen to grow – that's when things go from strength to strength. The real battle is on the ground and you have to fight for your sale everyday, you can only sell one at a time. From here if we've got the basics right, success just filters up.

The hardest part when you grow so fast is making sure you can sustain quality of service. This region, with so many expatriates, has a higher degree of turnover so to maintain service levels and training standards on customer care is a challenge.

Is it fair to say that internationally you are coming out of some dark times? And how has GM adapted?
Without doubt there has been a lot of attention on the US but also some amazing, perhaps unprecedented change. You don't find too many companies who can strip US$8bn of costs in one year, and this was done so consensually. We didn't, as the headlines suggested, send 10,000 people packing, we worked with labour unions and employees; all went voluntarily. We have dominated business back there for almost 100 years and have been number one since 1934. In that time we have had to keep reinventing ourselves and it's hard.

In my observation we have geared the company somewhere towards 25 per cent of the market, but I don't think our customers or shareholders care about that. They care about what tomorrow brings and we have to do our best even if it is for that quarter share.

The slowdown in the US domestic car market means you have no shortage of cars to sell to the Gulf market. Does one person's loss lead to Middle Eastern promise?
Fortunately the issues back home (Johnsson now lives in Dubai, but sees his actual home work-base as Detroit) haven't taken anything away from the growth regions and so in the last three years we have asked for and received the resources so that we can grow. In that time we have invested about USD$63mn in capital into a parts distribution centre just outside Dubai. We have taken our entire parts inventory from around the world and brought it here and so dealers no longer have to wait 70 days for parts to be shipped from Australia, Korea or the US.

What place does the new Yukon have in your new sales scenario?
It's not very often you get a complete redo of a vehicle and the Yukon comes on the market at a very good time. For those a little conscious of gasoline prices, this vehicle gives you the unique combination of great style, the best power and the best fuel economy of any car in its class. The variable intake system actually allows the engine to be quite efficient when cruising and when you need it the acceleration is there.

The customers really like small conveniences like being able to start the vehicle from 100m away to let the AC cool it down while you are walking towards it. This fits nicely in this environment and it is ideas and cars like these, that are helping our business boom.

It seems like you are out of the dark. Do you think the good times will keep on rolling with these plans?
All this points towards a very promising future. I can't tell you what, but we have some astounding products in the pipeline.

At the moment we are far from market domination in the Middle East, we are number two behind Toyota who are way ahead. And when I say we are second, there are probably a few of us who are sharing that position jointly. There are only about 2,000 sales units between us, Nissan, Hyundai and KIA. You can almost double that again before you even touch Toyota. But we believe we have a formula to change that.

You talk about the problems in the US but at the same time in China, which will one day be the largest market in the world, we are now number one. We have made a tremendous investment in that market with great success. India is another huge developing market where we already have one plant, which is soon to be joined by a second. Our footprint there is very strong. Whether it is Latin America, Africa, the Middle East or Central and Eastern Europe who are now coming on strong, I think we are positioned pretty well for the next 100 years.