General Motors is the largest automobile manufacturer in the world, and last year it placed Heidi McCormack at the helm of its operations in the C.I.S., where she now focuses on imports and distribution operations. General Motors C.I.S. imports four brands of cars — Opel, Chevrolet; Cadillac and Saab — distributes them on a wholesale basis and manages a dealer network. Ms. McCormack spoke to The Leader about the unusual career path that led her to GM via Egypt and her plans for increasing the company’s market share.

Heidi McCormack spent the third undergraduate year of her politics and economics degree at the American University in Cairo. After graduation in the United States, she returned to Cairo to do a Master’s in Middle Eastern Studies and then stayed on to work at a think tank and help Egyptian companies write business plans for USAID. Then she made a shift to Russia - and later became general director of General Motors C.I.S.

Why did you leave Egypt?
I was worried about the prospect of being an Egyptophile. So I got a job on Wall Street at a medium-sized investment bank, Bear Stearns. I worked in the mergers and acquisitions department of emerging markets. The management looked at Egypt, with its hyperinflation, post-socialist emergence and mass privatization and said that it reminded them of Russia.

So I moved from Egypt to New York in ’90 and my first assignment was to be part of the team privatizing AvtoVAZ. It is ironic that I’ve known the people at AvtoVAZ for longer than I’ve known my colleagues at GM. I spent a lot of time at AvtoVAZ’s base in Toliati from ’90-’92.

Did you experience a culture shock going from Egypt to Russia?
No, there really wasn’t one. Both countries are emerging markets with big disparities in wealth and with people who’ve had exposure to travel. Both have highly educated populations. Russia, in particular, has very high levels of literacy. I was also impressed by the level of multi-lingualness: certainly in comparison with America.
    
What brought you to Russia on a full-time basis?
In the mid-‘90s, a lot of Eastern European markets were really starting to happen economically. Russia is the country I was, and remain, most impressed with, in terms of development and natural and human resources.

So in ’94 four of us from Bear left and started an investment fund in Russia. It was called the Central Asian Investment Corporation and it focused on everywhere outside Moscow and St. Petersburg.

A lot of foreigners were here in ’94 investing in the stock market, but not many companies had taken the step of doing direct hands-on investment in the regions. In contrast, we had offices in Bishket, Almaty and Irkutsk. I ran the office in Irkutsk and covered Russia from east of the Urals East. I was out there for just under two-and-a-half years.

In April ’97 I joined General Motors as chief financial officer and director of new business development and the second part of my title was what took up 70 percent to 80 percent of my time — the development of the AvtoVAZ joint venture. GM wanted an in-house investment banker to come in and structure a deal for them and it helped that I knew AvtoVAZ.

Have you ever considered returning to the United States?
Russia is my home and has been for eight years now. I am probably more familiar with European business culture than I am with American business culture. Apart from Arabic, I also speak French, Spanish and Russian and Europe is an environment that I can function in easily. I like the fact that Moscow is multi-cultural and that everywhere you go there is history, a story, and it’s not just old history, but history in the making.

How many people does GM C.I.S. employ?
GM C.I.S., as a national sales company, employs about 50 people, with personnel working in finance, marketing, sales, after sales, parts and warrantee and brand management.

We don’t do any assembly here. The joint venture in Tatarstan did, but they have assembled all the parts they have. But the AvtoVAZ [joint-venture] will be a full-scale manufacturing operation, employing over 1,000 people.

What makes GM a unique place to work?
From the car side, it’s unusual because it has a very broad product diversity, and has everything from Chevrolets to luxury brands such as Cadillac and Saab.

The second thing is that GM has a strategy of forming alliances all over the world. GM owns part of Suzuki, Isuzu and part of Fiat, and the list goes on. That creates a very exciting sense of diversity and flexibility in product development and the market segments that we participate in.

It is also an interesting place to work due to the complexity of the automobile industry. There is really no other industry in the world quite like it. It goes from the smallest nuts and bolds on a car and the engineering and safety principles behind that, through to the manufacturing production process, the wholesale and retail process and finally to the ultimate thing, when a customer goes in a showroom.

And, in America especially, people spend hours in their cars. There are other industries that are as technically complex as the automotive industry, but I don’t know of any that have such a high daily impact on people’s lives and where customers have such a physical relationship with the product.

And, last but not least, GM is the largest automobile manufacturer in the world. It’s a legendary giant, and I guess it’s quite an honor to work for such a company.

What is your market share in Russia?
In the import sector, over the past seven months, GMs four brands have a market share close to 4 percent. Opel has occupied 2.9 percent of market share, and Chevrolet 0.4 percent. At the moment, the market leader is Daewood — which has 12 percent market share.

How do you plan to go about increasing your market share?
We want to be in the top five. Right now we are in the top 15, but the difference between each car manufacturer is not great. The difference between us now and being in the top five is only about 1,000 cars. It is a very small, competitive market. Given the new dealership we are opening up in the regions, increasing our market share so as to become one of the top five is very doable.

Two years ago, before the problems in Korea, Daewood sold some 15,000 or 16,000 cars. This year their sales figure is down to 4,000 or 5,000. Last year, Daewood’s market share was much higher than 12 percent; it was about 25 or 30 percent.) Daewood is probably not going to be in the future what it was in the past — so that’s one big chunk of the competition gone.

At the moment, other market leaders are luxury cars such as Mercedes and BMW. Our main-selling brand, Opel, is in a segment that will experience more growth than the luxury cars segment next year.

Please tell me about your growth strategy.
We are really pushing forward with dealer training programs and focusing on customer service and satisfaction.

Russians buy cars on cost. This means that they are not particularly brand-loyal. When you buy your first car you often don’t think about warrantee cost or about how much it would cost if you were to have an accident. But when you buy your second car, you will be more likely to think about these things.

In the coming years, customers will start to focus on quality service, car maintenance and operation. We are getting ready for that.