By on April 27, 2009

Time’s up! GM has announced that 2010 will be Pontiac’s final year. No surprise to anyone who’s been reading the writing on the wall. But nevertheless a sign that those in charge of GM’s destiny are more interested in appearing to be doing something than in actually addressing the core weaknesses of the car manufacturer. Why is so much attention focused on GM’s brands? Because, like the CEO, they’re what outsiders can see and at least superficially understand. The real problems are both less visible and less easily comprehensible.

As some within GM have long recognized, a wide array of brands could be a major competitive advantage. When you have multiple brands to work with rather than just one or two, each brand can be tightly focused, and thus be more meaningful than a brand that must be all things to all people. GM didn’t prosper because it failed to provide each brand with distinctive, desirable cars. Instead, every brand attempted to be all things to all people. Why? Partly because distinctive products cost more to develop than badges alone, but also because each brand had its own dealers, and each dealer wanted one of everything.

Dealers’ desire was not irrational. Demand for different sorts of cars varies with gas prices, the economy, and fluctuating consumer tastes. Any dealer that wanted steady sales—a key goal for any business—wanted a diverse set of products to sell. This longstanding problem was finally addressed a few years ago, when Buick, Pontiac, and GMC were combined into a single channel. This should have freed up Buick and Pontiac to focus on specific groups of car buyers with finely tuned products.

Pontiac’s focus was to be enthusiasts—for real this time. Bob Lutz announced that every future Pontiac would be a rear-wheel-drive performance-oriented car. Three models, each with two or three body styles, would have been sufficient: the Solstice coupe and roadster, the large G8 sedan and (planned but canceled) wagon, and a smaller Alpha-based coupe, sedan, and (possibly) hatch. No other mainstream brand offers a compact rear-wheel drive sedan, or focuses so tightly on enthusiasts. An Alpha-based Pontiac could have been a big winner. Hopefully we’ll still see this car from Chevrolet. But it would have been better from a brand focused entirely on driver’s cars.

So, maybe GM had finally figured out how to realize Pontiac’s potential, only to have gas prices shoot up and then have the bottom fall out of the market. GM being GM, plans for performance-oriented cars were tabled not long after gas prices spiked. Unlike the strongest auto companies, GM has long had a habit of constantly second-guessing its plans and over-reacting to car market fluctuations. Of course, this time around GM had no choice: it’s out of cash. It might have finally muddled through to a solution, but too late.

And so Pontiac will die next year. Saturn, Hummer, and Saab will be gone even sooner. This doesn’t change one key fact: killing brands does not address GM’s historical inability to consistently create distinctive, desirable cars.

Limited resources have often been blamed for this inability. Supposedly GM split its product development and marketing funds too many ways. But if each product was viable, it should have been possible to gather the necessary funds for it, at least before the recent collapse. Funds were limited because of limited faith, both inside and outside GM, that proposed products would be profitable.

The root problem: senior executives at the top of the corporation continue to be involved in more product decisions than they can possibly make well. These senior executives cannot understand each product and market the way an empowered, dedicated product team could. And they lack the time to personally make all of the decisions that need to be made.

The visible consequences: a few great cars that received the undivided attention and logjam-breaking influence of senior executives, and a larger number of not-so-great ones that did not receive this attention and influence.

Two possible solutions: reduce product offerings to a number that senior management can personally attend to, or transfer decision-making authority for these products to multiple units lower in the organization. GM made feints at the latter strategy, most notably with the mid-nineties formation of cross-functional vehicle teams led by Vehicle Line Executives. But this decentralization was never complete, and with each crisis the organization backslid to its old ways.

Even with GM on the brink of bankruptcy, there’s still no sign that substantial changes are being made to the GM organization. They’ve replaced the CEO and they’re reducing the number of brands. This treats the symptoms rather than the disease. How this course of action generally turns out: the surgeon (wielding a cleaver in this case) cuts and cuts and cuts until the patient dies.

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40 Comments on “Editorial: General Motors Death Watch 247: Brandicide Won’t Save GM...”


  • avatar
    MisterB

    I agree. On the DEALER level, GM will now have Buick/GMC, Chevy and Cadillac dealers. I don’t see how Buick/GMC dealers will be viable. The BG (PBG) dealers will now have old people cars and trucks which have the same models available in Chevy trucks. They will not have any inexpensive cars or performance cars. Is Buick going to now sell cheaper cars and performance cars??? Buick and GMC already have limited advertising support as it is.

    I see the problems being more at the dealer level. GM’s tying to support all of its dealer lines with a full product line has been a major problem. If through bankruptcy, GM could conbine dealers into two groups: Chevy and Cadillac then they could actually keep the Buick and Pontiac brands. It is really the GMC brand that has no real purpose. GMC exists solely so that the current PBG DEALERS have trucks to sell.

    If there were only Chevy and Caddy dealers, GMC would disappear. Pontiac could move to the Chevy dealers as their performance product. Buick could go back to its role as a near-luxury line. As such, Buick could be sold under either Chevy dealers or under Caddy dealers.

  • avatar

    It does seem that almost everything GM does avoids dealing with the changes that are required in their corporate culture. It’s unfortunate, because it shows that they are capable of making good cars, but have not proven they can do it consistently. And if (a BIG if) GM is able to come out of this (with or without C11), I don’t see them as a stonger company.

  • avatar
    thalter

    GM made the right call. While turning Pontiac into a performance boutique sounds good in theory, in reality it would take years to undo the damage done to the brand by Sunfires, Montanas, Aztecs, and G3s.

    GM does not have that kind of time or money. They could always try to resurrect the brand in a few years, after it has had time to “rest” (a la Mini).

  • avatar
    GS650G

    I think Buick and Cadillac have a better chance on the same lot than GMC Buick. Buick can offer cars that are more refined and luxurious while providing an upgrade (or up sell) path to Cadillac. At least the demographics of buyer would match.

    Saab is a sob story, time to die already. Sales are non-existent for a complete line of cars, the only way it could survive is to have a single model under Chevy that carries a Saab name but that is a bit ridiculous.

    Hummer. I thought they dumped this already.

    Saturn. Truly a shame, but someone has to notify those Saturn dealers that unless they want to turn into Walmart auto sales and slap the Saturn badge on foreign built cars, it’s over. We are talking about a lot of dealer closures, bankrupting and un-employing a lot of people. I think the Saturn drop will be bigger than Olds and far more costly.

  • avatar
    dolorean23

    The root problem: senior executives at the top of the corporation continue to be involved in more product decisions than they can possibly make well…and they lack the time to personally make all of the decisions that need to be made.

    I couldn’t agree more. Unfortunately most big business over the last 30 years tends to work this way; providing for the Shareholder over the Customer. When you constantly worry about Profit margins vs. Quality concerns, Short term vs. the Long term. This creates a culture where you learn nothing from mistakes by trying to create a no-fault environment, mistakes that are made are swept under the rug and paid for later, and executives who pay more attention to Wall Street and the Dealerships than to Joe Q. Public.

    The only GM cars I’ve bought in the last 20 years has been Saturns. Saturns weren’t BMWs by any means, but they never tried to be either. They were what GM needed; A simple brand with a good price and a quality car. Too bad they never figured that out.

  • avatar
    jpcavanaugh

    I agree completely with the thrust of the editorial. It has been decades since GM was a leader. Instead, GM has been in reactive mode since the 60s. I would add that the badge-engineered vehicle clones are the fault of Chevrolet Division as much as or more than that of the dealers.

    In the early 50s, Ford (then #3 of the big 3) set out to reorganize itself along GM lines. By 1957, Ford had 2 wheelbases, Mercury moved upmarket and got a unique body and Edsel was slotted between the long wheelbase Ford and the Mercury. Then there was Lincoln. By 1958, the bottom was falling out of the mid-upper priced market and FoMoCo retreated to what it had always been – Ford, a slightly disguised Ford (Mercury) and Lincoln. In short, virtually nothing to compete with Pontiac, Olds and Buick.

    With no Choice, Ford started to grow the lineup and prestige of the Ford line. Starting with the TBird, they added the Mustang, the LTD, the Granada, luxury vans, the Explorer, the Expedition, and so on. Not all of these were very good cars (the Granada comes to mind), but each was (when new) seen as competitive with GM vehicles higher up the price ladder from Chevy. And each time, Chevy responded with a new model.

    By the 90s, everything of value in the Ford stable (below the Cadillac/Lincoln class) came from Ford Division. Ford had successfully taken on and either vanquished or was at least competitive with Pontiac, Olds and Buick.

    Just like in 1959-60 when the new Ford chief Robert McNamara squeezed Ford and Mercury into Edsel’s territory, starving it out of the lineup, GM has done this same thing with Chevy moving up from the bottom. Ford’s weakness became its strengh, its structure becoming most like Toyota’s has become – a full line brand and a luxury brand. Mercury hangs on to add volume for Lincoln dealers, but is inconsequential. GM’s strenth, mismanaged, became its weakness. GM management still doesn’t appear to understand what has happened, which guarantees that the fumbling will continue.

  • avatar
    windswords

    Wow, two GM Deathwatches in a single day. Is this some kind of record?

    “Two possible solutions: reduce product offerings to a number that senior management can personally attend to, or transfer decision-making authority for these products to multiple units lower in the organization. GM made feints at the latter strategy, most notably with the mid-nineties…”

    Sounds like what Chrylser did in the early 90′s. Too bad GM wasn’t able to pull it off.

  • avatar
    Rod Panhard

    You can like or admire Fiat’s CEO, or you can call him an egotistical doofus. It matters neither, as there is one critical thing he knows. GM is an example of what’s wrong with the U.S. car industry. It’s a company that’s mired in bureaucracy. He learned it first hand.

    So while this zombie walks, it will continue to have two master bureaucracies. … What’s left of GM and the US Government.

    Nothing’s changed. It’s just smaller.

  • avatar

    thalter:

    I’ve been wondering whether GM execs might be telling themselves that they can always bring a brand back if and when they get the company back on its feet.

    I’m not arguing that, given their current condition, they can sufficiently support these brands, only that cutting brands is not in itself the solution.

    And yet–how will it help to cut Pontiac so quickly? Are they losing so much money on Pontiacs that they’ll burn through less cash by cutting them?

    I hope they’re not assuming that most people who would have bought a Pontiac or a Saturn will simply buy a Chevrolet or Buick, because that’s been proven not to happen. Note how Saturn sales continued to fall even after they cut Olds.

  • avatar
    mach1

    Am I missing something here?

    GM should have at most three channels:
    - Cadillac / Buick
    - Chevrolet (all cars except Cadillac & Buick / no trucks or vans)
    - GMC (all trucks and vans)

    With Cadillacy and Buick in the same showroom, the Buick buyer of today may someday “move up” to Cadillac. (like Ford has done with Lincoln / Mercury.)

    Putting all the trucks / vans together eliminates the duplicate name plates and the internal competition between Chevrolet and GMC.

  • avatar
    OldandSlow

    Yep, the bureaucratic culture of GM finally did them in.

    With the exception of Corvette and the Tahoe, it’s been at least two generations since a small team of engineers and designers from GM have put out a best in class product.

  • avatar
    MisterB

    I still believe that GM should have only 2 dealer channels. Chevy dealers sell the most trucks by far and they need trucks. GMC as a stand-alone truck dealer seems extremely weak. You need to consider what GM has now: Caddy, Chevy and Pontiac, Buick, GMC. It’s the new Buick/GMC channel without Pontiac that seems very weak and should not exist in a re-organization.

  • avatar

    There’s absolutely no way that trucks would be taken away from Chevrolet. Chevrolet dealers would probably be more willing to give up cars, even in the current market.

    Buick/GMC does not seem viable. But they’re already tooling up for two new Buick cars, so it probably doesn’t make financial sense to kill the brand before these have a shot at earning back some of that tooling money. Ditto GMC with the Terrain.

  • avatar
    menno

    I believe 2010 Pontiac G8′s are already on the ships coming from Australia, so I suspect that very soon, that’ll stop and Pontiac will, too.

    I have to wonder if the NUMMI plant in California will cease to be, or whether Toyota will simply buy it (in hopes that they can actually use it as a viable plant in the future). Actually, now that I think about it, why should/would Toyota buy a UAW plant?! Especially given that there is a massive reduction in the market and their other plants are underutilized.

    Nah. NUMMI is dead. Pontiac, Hummer, Saab and Saturn, too.

    Buick and GMC are not going to be viable unless GM brings Chinese built Buicks over (built with super-cheap labor).

    Watch them do just that (assuming GM survives I mean) and possibly even move the price point of the cars down to the level of the old Pontiac G6 which seemed to be popular.

    The upcoming mid-sized Buick (epison? platform, is it?) intended for China would fall into the spot vacated by the (equally Opel based) Saturn Aura and Pontiac G6.

    Found it (thank goodness for the edit function) – it’s called the Buick Regal, which is the same class car as this name used to use. Looks nice…. at least.

    http://images.google.com/imgres?imgurl=http://www.blogcdn.com/www.autoblog.com/media/2008/12/x08bu_rg002cn-1280_opta.jpg&imgrefurl=http://www.autoblog.com/2008/12/29/pics-aplenty-chinese-spec-buick-regal-looks-darn-good/&usg=__NBBLa3Hzyy-r6A9D4rQXGgQYsnw=&h=387&w=580&sz=60&hl=en&start=4&um=1&tbnid=g_ajPBGcCTA5ZM:&tbnh=89&tbnw=134&prev=/images%3Fq%3Dchinese%2Bbuick%2Bepsilon%2Bsedan%26hl%3Den%26safe%3Dactive%26sa%3DN%26um%3D1

    Buick historically did fairly well selling this size of car prior to their discontinuation about 1/2 a decade ago.

    Once upon a time, even leadfoots bought Buicks.

    1940′s and 1950′s Buick Century’s; 1960′s Buick Rivieras; 1960′s Buick GS-455′s, 1970′s Buick Skylark GS’s; 1980′s Buick Grand National and GNX….

  • avatar
    joeaverage

    Hey I’ve got a new idea – why not cut Chevrolet? Everybody tip-toeing around Chevrolet’s product lineup.

    GM is so screwed.

    Trucks, vans = GMC
    Sporty cars = RWD = Pontiac (never mind)
    Clever compacts = FWD = Saturn (never mind)
    Lux = Caddy (no wagons?)
    Boring $ sedans = Chevy
    Boring $$$ sedans = Buick
    Crummy compacts = Chevy

    Exactly what does a Buick offer that an expensive Chevy doesn’t? Not much in my opinion.

    Maybe they need Chevy + Caddy and ‘nix everything else.

    Really I’m so mad at them for screwing up so many times over the my entire adult life. And now they are doing it with my tax money.

    And yet again the overseas products are beautiful and yet again we can’t get them here. Buick Regal = nice… I don’t care what nameplate they put it under. Just sell the damn thing here, okay???

    My perfect daydream is one where GM continues to ****-up and Opel brings their entire product portfolio here independent of GM about the same time I need a new car or two and I can then buy whatever one I want from a former Saturn dealer with no-haggle (but fair) pricing. And then have a positive owner experience for 200K miles+.

    If you think that is impossible – I’m pushing 176K on a ’99 CR-V and it appears to have at least an easy 100K miles left in it. Original clutch, original everything else too – except radiator (leaked), timing belt, front pads x2 and fluids. Struts are still good, clutch is still good, a/c is still good, shifter is still tight, steering is still tight, etc.

  • avatar
    menno

    I strongly suspect GM will “kill” Saturn off and not sell it. Why sell a (somewhat viable) dealer network to some Chinese or French-Japanese competitor when the actual fine-print on the dealer franchise agreement allows GM to shut the whole operation down without penalties? (Unlike other GM “makes” – hence the reason that only Pontiac went away and not Buick and GMC as well – this will limit lawsuits to a minimum since there are VERY few Pontiac only stores). Most “middle of the road” GM franchises sell Buick-Pontiac-GMC. Now it’ll be Buick-GMC.

    Besides, the rumor that Renault was going to buy up Saturn is just stupid. What exactly would be any benefits since Nissan already has an underutilized presence in this country, anyway? It’s not like Renaults and Nissans are hugely different under the skin any more, anyway.

    BTW, both Edsel and DeSoto were killed off in the actual year BEFORE the model year cars then being sold. Edsel was killed before Christmas of 1959 (with only a few 1960′s sold) and DeSoto likewise met its maker before Christmas of 1960 (with only a few 1961′s sold). Likewise, Studebaker quit building their (quite rightly famous and beautiful) 1964 Hawks before Christmas of 1963. A few Lark bodied cars were built in Canada through early 1966…

    I bet GM could bring this Regal into the US (and even assemble it here from kits with some US content), and if the bumpers can’t be modified for Canadian 8km/hr (5mph) spec inexpensively, it sure would be easy to slap a new grill and badges on the Malibu for cheap (maybe use the now redundant Aura interior, even), slap on some Beaumont badges and sell the sucker through Buick-GMC dealers in Canada only.

    The Canadians would probably love to see that old brand come back.

  • avatar
    Jim Cherry

    I agree with Oldandslow: “Yep, the bureaucratic culture of GM finally did them in. ”

    But not just any old bureaucratic culture, a bureaucratic culture of a very specific kind. MBAs ran the show with increasingly centralized power given to the financial side. This worked in the short run, but killed the goose in the long term.

    You can read about that here:
    http://www.examiner.com/x-6882-LA-Classic-Cars-Examiner~y2009m4d17-GM-near-bankruptcywhat-happened

    And Pontiac in particular?
    http://www.examiner.com/x-6882-LA-Classic-Cars-Examiner~y2009m4d25-The-Pontiac-story-death-of-an-American-classic

  • avatar
    stars9texashockey

    This is the best synopsis of the once mighty GM and how it has crumbled before our eyes.

  • avatar
    amadorgmowner

    First GMAC kills my local (rural) long-time Chevy-Buick-Cadillac-GMC-Pontiac dealer (huge fleet sales and local retail loyalty)then they kill the products that I have owned and currently own (Pontiac). What next? GMC? (I also own a 2007 GMC Yukon Denali XL)Am I not getting the message that GM no longer wants my business? Then, they and GMAC take my tax dollars, shut down my local dealer and then kill or threaten to kill the products that I prefer to buy. My tax dollars used to pay for the past mistakes of the GM/GMAC bean counters who ran the company like a bank ( a bad one) and then punish me the loyal customer. I am done with GM. They couldn’t build their way out of a paper bag, let alone build good cars without bean-counters killing them. Toyota, here we come.

  • avatar
    oboylepr

    The whole shooting match needs to go. GM and ALL it’s brands are collectively a poisoned chalice. The success of the automotive enterprise that replaces GM will depend on how much of a disconnect both culturally and technically there is between it and the old GM. Many of the cars can be kept as they are good vehicles but they will need new names both for the brands and the models. GM lasted for 100 years, a long time for sure, but both it and it’s brands are well past the ‘sell by’ date. Sure a lot of history, tradition, heritage or whatever will slip into the past but so be it. let it go. As someone has already said the GTO (the original) may be a legendary Pontiac but Joe Public will only remember the Aztec or the Montana or some other pathetic mediocre product that had a Pontiac badge on it. I used to be an Olds fan but the only one I ever owned was a piece of unmitigated crap. The new GM, ENTER NEW NAME HERE:…….., must not be hobbled by the huge mistakes of it’s ancestor. Maybe TTAC should have a competition to name the new company, it’s brands and it’s models?

  • avatar
    quasimondo

    What do you mean brandicide won’t save them? It’s what you all have been screaming for.
    File Chapter 11!
    Dump the UAW!
    Jettison the dealers!
    Eliminate everything except Chevrolet and Cadillac!

    At times, it seems like GM was secretly reading from your playbook and now you say it’s all for naught?

    It’s enough to make me wonder if these suggestions are nothing more than a subliminal form of sabotage.

  • avatar
    mtr2car1

    If it was me and I was looking at it from a productivity stand point – I would Dump Cadillac before even thinking about Buick. For these guys the brands and the lines within cost money (marketing/product development/incentives/ect.) and the spreading of the costs is a good way to make more.

    Last year, Buick sold 85% of Caddys volume but did it with less than 50% of the nameplates (basically 2 cars and a truck vs. 4 and 4 for Cadillac) – sounds pretty productive to me.

    Pontiac is a victim of not being able to pay back in sales for the line they carry – think beyond the enthusiast perspective and Buick makes sense.

  • avatar
    Scorched Earth

    Agreed with quasimondo. What gives?

  • avatar
    Pch101

    By itself, killing the brands will, without further action, achieve nothing.

    But no argument has been presented here as to why they are worth keeping. Not only are they indistinct, but the effort that could be invested in creating several niche brands would be better allocated to creating a couple of monster brands that actually make money.

    Other car companies can successfully and profitably sell 20-25 vehicle lineups with two, maybe three brands. I see no reason why GM needs eight brands, or even four, to do what others have done with less.

    If anything, these brands have been crutches that created inaction. Instead of focusing on making great cars, they scrambled to figure out (poorly) how to justify the ongoing existence of badges. Not a particularly useful strategy, in my view; a lot of wasted time and money, with no payoff. It just sucks that now it’s my tax dollars that have to pay for what GM should have funded out of its own operations.

    At times, it seems like GM was secretly reading from your playbook and now you say it’s all for naught?

    Look at the byline. Messrs. Karesh and Farago don’t agree with each other. Personally, I think that it’s a good thing that alternate views get published, even if I don’t agree with some of them. Call that “sabotage” if you like, but I wouldn’t.

  • avatar
    akear

    With just two brands I don’t see GM even maintaining a 15% marketshare. I predict by 2015 GM will have only 12% of the US market. Even Nissan and Volkswagon may someday surpass them in the North American marketshare.

    GM is done.

    Excrement!

  • avatar

    what people are missing is that they are doing this on purpose.

    Olds dropped names, changed slogans, and went to only console shift.

    Pontiac without Grand Prix? Bonneville?

    Pontiac is Car???

    are you kidding me?

  • avatar
    kovachian

    Woohoooo another one down, just two more to go! Come on GM, you can do it!

    TWO. BRANDS.

  • avatar
    ctoan

    The problem with the Chevy-and-Cadillac theory is that Chevy’s cars (Corvette doesn’t count) are currently competing with Kia — and Kia’s offering is usually better. Even the Malibu can’t sell because it’s surrounded by crap. Discounts are expected. Cut off enough fat and GM can probably survive for a while longer selling the low end of the market, some thoroughly competitive Cadillacs, and some awesome trucks, but that can hardly be called saving the company.

  • avatar
    russification

    pontiac was one of my favorites growing up. the badge had all the dynamics to make great cars, excellent analysis of the business model above. A sad day.

  • avatar

    quasimondo:

    As Pch101 notes, RF and I don’t agree on the value of GM’s brands, and RF deserves credit for posting perspectives he doesn’t personally agree with.

    Pch101:

    There are two ways to compete.

    You can either do the same thing everyone else is doing, just better. Or you can do something that the competition cannot do.

    GM’s brands gave it the potential to offer more focused brands than the competition. The problem wasn’t the number of brands, but that this potential was repeatedly squandered.

    An automotive world in which focused brands don’t make sense is one where all we have to choose from are Camrys and Accords and competing cars that want to be Camrys and Accords. A bunch of boring appliances.

    My personal interest in GM was that they offered the best hope for interesting mainsteam cars, because if they failed to develop such cars they would fail.

    We now have our answer.

  • avatar
    shaker

    I owned a dark green ’69 Grand Prix like the one pictured.
    It was a unique car – I don’t know if the chassis was “shared” with any other GM vehicle, but the car was unmistakably a Pontiac. It had a 400 Pontiac motor that was different from a Chevy, Cadillac or Buick motor. It had… brand identity!

    That’s what was lost over the years.

  • avatar
    Pch101

    GM’s brands gave it the potential to offer more focused brands than the competition.

    I question in this case whether that was necessary or even possible. Focused brands require investing time, effort and money in building niches, and there doesn’t seem to be much call in automotive sales for niches.

    They become all-or-nothing affairs, as did Hummer (which went from hero to zero in no time flat), or get caught in a product trap such as Mini, which is now going to have to build every variation on the theme possible if it wants to go the distance, which both helps and threatens to dilute the brand at the same time. For luxury consumer goods or exotic cars, this can work, but I have to wonder about this for mainstream and luxury cars.

    And if all of the specialty products end up in niches, then none of the image building that may come from halo products is cast onto the mainstream brands. You end up with a main brand that is bland, which means low prices. If there’s anything that GM doesn’t need, it’s low prices.

  • avatar

    Great cars have no need for halos. And when people have a choice between a great car without a halo model in the line-up and an average car with a halo model in the line-up, they overwhelmingly choose the former.

    Even a halo that stands on its own like the Corvette hasn’t influenced a significant number of people to buy a Malibu instead of an Accord. Designing a better, more attractive Malibu was a much more effective strategy.

    The whole “halo” argument is a BS justification for developing a specialty model that cannot be financially justified.

  • avatar
    mach1

    The only halo that is worth a damn is the one attached to the brand itself. The fact is that a Toyota vehicle gains luster from the overall reputation of Toyota, This is a circular relationship where the brand is burnished by consistent qualities of each offering from the brand and the brand reputation flows back to the vehicles giving each new offering a head start in customer acceptance

    This works in reverse also. One or two bad vehicles can taint all the vehicles from that brand and it takes a very long time to recover.

  • avatar
    Pch101

    Great cars have no need for halos.

    If used effectively, halo cars build and save brands. Ghosn’s use of the Z-car is a prime example of using halos effectively for repositioning a brand. The Prius is arguably a halo car for Toyota, one that is now quite profitable.

    Even a halo that stands on its own like the Corvette hasn’t influenced a significant number of people to buy a Malibu instead of an Accord.

    True. But there is no design DNA whatsoever that filters from the Corvette into the rest of the lineup, which is a mistake.

    In effect, the Corvette has become a brand unto itself, even if it theoretically is just a nameplate. GM has failed to leverage the Corvette into something that can be used to create credibility for the other Chevys. The fault with that lies with the design of the other vehicles (and by extension, the management of Chevrolet and GM), not with the Corvette.

  • avatar
    KalapanaBlack

    Anyone else remember when the all-new 2004 Grand Prix was supposed to compete with and beat the Accord and Camry? How it had class-competitive interior and packaging?

    As 90% seem to have gone to rental fleets since 2005 (its second year on the market – that turned out well!), I’ve had plenty of experience with those pieces of trash. Amongst the constant power steering pump failures and incessant need for replacement wheel bearings (at less than 30,000 miles, most had multiple replacements of both), rental customers often turned them down because of the fugly, Dollar Tree-grade interior and complete lack of rear seat headroom/legroom.

  • avatar
    geeber

    shaker: I owned a dark green ‘69 Grand Prix like the one pictured.
    It was a unique car – I don’t know if the chassis was “shared” with any other GM vehicle, but the car was unmistakably a Pontiac. It had a 400 Pontiac motor that was different from a Chevy, Cadillac or Buick motor. It had… brand identity!

    The 1969 Pontiac Grand Prix used a special version of the standard intermediate platform – it was known as the “G” body within GM. It was shared with the 1970 Chevrolet Monte Carlo and Oldsmobile Cutlass Supreme formal roof coupe.

  • avatar
    Flake

    Mr. Karesh is right. GM’s brands could have easily been an asset if they were nurtured and focused properly. Problem, is, the company STILL doesn’t seem to understand that you can’t just decide what you want your brand to stand for, say “This is the Word of the Lord”, and have customers believe it. It takes decades of product consistency to build a powerful brand, especially with a product that has as much longevity as a vehicle.

    GM’s brands are an epic FAIL when they could have so easily been a WIN with proper product planning and consistent brand messages. Instead, they became a clusterf*** because too many cooks (dealers) spoiled the soup with their input (i don’t blame them for wanting more product and profits). Management (the head chef) should have been policing this. But their greed got the best of them and they drove the brands into the ground. So why is GM Management STILL catering to what its dealer network input when they so easily could be making the tough decisions necessary to ensure that their brands last? After all, the largest ever presidential bankruptcy court wouldn’t be all that nice to those franchise agreements.

    GM should be Chevy, Cadillac, and Buick (Buick should only be kept because or China…they can be designed there and sold here) and, if they intend to be successful in their respective missions, they each need their own dealer network. If Buick wants to be near-luxury, putting it in the same dealership with a brand that must also cater to those who want a common man’s industrial grade truck is a disaster. GMC is, and will continue to be, unnecessary unless truck buyers begin caring that that their manufacturer also sells cars. Let Chevy have the trucks. And Chevy and Cadillac under one roof is absolutely foolish. Sales personnel will never be the caliber they need to be if you make them sell Cadillacs and pay Aveo wages…no profits on Cadillac wages for selling Aveos. I see no other luxury brand being sold alongside its non-luxury sibling.

    I know there’s a lot going on with franchise agreements, etc., but hasn’t the time come to make the tough decisions?

  • avatar
    davejay

    Okay, here’s my painfully uninformed guess at what they might do, or at least maybe should consider.

    TRUCKS

    Chevrolet: sell “consumer grade” things. Their trucks would be SUVs and lower-weight-capacity vans and pickups.

    GMC: sell “professional grade” things. Their trucks would be higher-weight-capacity vans and pickups, and rolling chassis for utility vehicles and whatnot.

    CARS

    Chevrolet: sell “consumer grade” things. Like Nissan’s 350Z compared to Infiniti’s G37, chevrolet products would have the cheaper interiors, less elegant exteriors, and lower price tags. Not much change, really. If you like American products, this is where you go.

    Buick: sell “alternative” things, no badge-engineering allowed. On the small side, you’d have the Buick Astra and the Buick Vibe; on the large side, you’d have the Buick G8 and the Buick Sky (all renamed, of course.) Buick as a brand sucks, so reinvent it by letting Buick mop up people who don’t like what Chevrolet has on offer. If you hate American products, this is where you’d stop on your way off the Chevrolet lot.

    Cadillac: sell “top-of-the-line” things. The CTS, the Escalade, a fantastic small car along the lines of the Mini, and so on. Keep the product mix small, and make it the best stuff you sell. The Corvette might be the only exception to this, but in theory it should be a Cadillac. Where Chevrolet is Nissan, Cadillac is Infiniti.

  • avatar
    Prado

    Lets see… there is a huge demand for the new Camaro and GM’s flagship sports car is also a Chevy. So what exactly does GM need Pontiac for?


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