GM CEO Concerned About Rising Korea Tensions

NEW YORK — (WWJ) As North Korea makes more threats against its southern neighbor—and the United States—General Motors has started making some contingency plans.

GM has five plants in South Korea, as well as a large research and design center. It build about one and a half million vehicles in that country each year, mostly for export.

“Anything that goes on in Korea is critically important to our global production, and how we view the world,” said GM CEO Dan Akerson.

Akerson tells CNBC that, for now, GM is making plans to protect its employees. But, if tensions rise more, they could look at moving production.

“You’ve gotta start to think about where you have the continuity of supply and safety of your assets and employees. So, it’s a concern to, I think, everybody.“

The GM CEO says while his company has had discussions with experts, he has now clear idea of what will happen on the Korean peninsula. It’s a particular concern, he says, because in North Korea, “you have an untested, young, unseasoned leader, and the dynamics underneath that are hard to understand.”

The global dynamics of the auto industry, Akerson says, mean any production disruption in Asia, has the ability to have a very wide impact very quickly.

“If there was something to happen in Korea, it’s going to effect our entire industry, not just General Motors.”

Akerson spent the 7 to 8 AM hour guest hosting the CNBC morning business news program “Squawk Box.” He also said that he believes that it will take four to five more years before all of the pent-up demand in the auto industry plays itself out, and that GM research shows that the “Government Motors” label has mostly faded from the company.

More from Jeff Gilbert

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