General Motors Death Watch 48: The Price is Wrong

Robert Farago
by Robert Farago
general motors death watch 48 the price is wrong

Regrets? GM's Vice President of North American Vehicle Sales has had a few. Then again, too few to mention. When quizzed about the wisdom of last summer's Fire Sale for Everyone, Monster Mark LaNeve said "Hindsight being 20/20, I probably wouldn't have done it." Probably? The campaign annihilated The General's fall and winter business and sealed GM's rep as America's largest discount car company. Which LaNeve now vows to fix by ignoring the connection between guilt and change and reanimating the company's short-lived "Total Value Promise" program.

Which is what, exactly? Although LaNeve's past rhetoric qualifies him for a job as the fifth Wiggle, and the specifics of the latest version of the Total Value Promise (TVP) await a Detroit unveiling, Monster Mark's been dropping hints. At the LA car confab, the slightly confessional marketing maven revealed the basics: lower sticker prices and a clear focus on comparative excellence. "We'll say, 'Best product, here's why," LaNeve said. "'Best price on an MSRP basis.'" What's more, "With every new product we bring to market, we'd like to price it very aggressively."

Not to coin a phrase, but the spin-out starts here. First of all, GM doesn't make the best products. While The General's camp followers will cry foul and cite various measurements placing GM vehicles head and fenders above the competition, the Chevrolet Corvette is the company's only undisputed class leader– and the $65k sports car division isn't exactly what you'd call crowded. Sure, GM's refreshed SUV's may turn out to be the business, but the majority of GM's products are also-rans. After all, if GM vehicles WERE the best of the best, the world's largest automaker wouldn't have to discount the damn things.

As for GM's plan to reduce advertised prices, well, we've been here before. In the brief period between Fire and Toe Tag sales, GM launched (pre-launched?) the TVP. Then as now, Monster Mark declared that GM's window stickers would be "closer" to the actual bottom line. The fact that this less-than-iron-clad "promise" was quickly and completely deep-sixed for yet another nationwide incentive campaign removed any chance consumers would believe GM's latest pledge. And why should they? You don't have to be a Keynesian economist to know that The General's inability to limit its supply guarantees a glut, which assures an eventual price cut. Lesson learned? Wait and prices will fall.

In fact, the whole concept of MSRP (Manufacturer's Suggested Retail Price) has been thoroughly discredited. Thanks to a seemingly endless succession of nationally-advertised discount campaigns, consumers now operate on the basis that a vehicle's MSRP is only an inflated starting point, or, if you prefer, meaningless. No one pays sticker. No one. How do consumers compare vehicle prices when they're subject to an ever-changing farrago of incentives and finance offers? The savvy ones go to independent websites like, press a few buttons and sort it out. Given the confusion, volatility and newfound transparency of car prices, GM might as well lose the sticker and simply direct consumers to an appropriate website.

Obviously, legally, they can't do that. Equally obvious, strict TVP adherence is highly unlikely, veering towards impossible. Think of it this way: if one of GM's competitors reduces their prices with an incentive campaign, a TVP-faithful GM could only respond by lowering their advertised sticker price. That's not a strategy bound to please recent owners or dealers, whose livelihood depends on trying to maintain as much of the inflated MSRP as possible. It also flies in the face of common sense: what's built must be sold. If discounts are what American consumers need to get the iron off the lot, discounts is what they're gonna get.

The biggest problem with TVP is that GM is, as always, hedging its bets. Note LaNeve's use of MSRP as a measure of relative price; GM is not promising to have the best price relative to the competition in absolute terms. By the same token, LaNeve said he would "like" to price new vehicles aggressively, not that he 'will.' In truth, there's only one alternative to the current rebate-driven set-up: the no-dicker sticker. If GM really wants to eliminate incentives, they have to say 'this is the price for this vehicle.' Period.

You could certainly posit that much of the Fire Sale for Everyone's success was due to the [perceived] lack of price negotiation. You could also credibly maintain that non-negotiable prices assured the Saturn brand's initial survival. But you'd have a hard time arguing that GM's management has the stones to weather the inevitable fall-out from a no-haggle pricing policy, as dealers scream bloody murder and duff vehicles pile-up in their thousands. Bottom line: expect GM's TVP to fade into obscurity for the second time, replaced by yet another round of rebates. And once again, Monster Mark LaNeve will be left without regrets.

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  • Brett Woods My 4-Runner had a manual with the 4-cylinder. It was acceptable but not really fun. I have thought before that auto with a six cylinder would have been smoother, more comfortable, and need less maintenance. Ditto my 4 banger manual Japanese pick-up. Nowhere near as nice as a GM with auto and six cylinders that I tried a bit later. Drove with a U.S. buddy who got one of the first C8s. He said he didn't even consider a manual. There was an article about how fewer than ten percent of buyers optioned a manual in the U.S. when they were available. Visited my English cousin who lived in a hilly suburb and she had a manual Range Rover and said she never even considered an automatic. That's culture for you.  Miata, Boxster, Mustang, Corvette and Camaro; I only want manual but I can see both sides of the argument for a Mustang, Camaro or Challenger. Once you get past a certain size and weight, cruising with automatic is a better dynamic. A dual clutch automatic is smoother, faster, probably more reliable, and still allows you to select and hold a gear. When you get these vehicles with a high performance envelope, dual-clutch automatic is what brings home the numbers. 
  • ToolGuy 2019 had better comments than 2023 😉
  • Inside Looking Out In June 1973, Leonid Brezhnev arrived in Washington for his second summit meeting with President Richard Nixon. Knowing of the Soviet leader’s fondness for luxury automobiles, Nixon gave him a shiny Lincoln Continental. Brezhnev was delighted with the present and insisted on taking a spin around Camp David, speeding through turns while the president nervously asked him to slow down.
  • Bobby D'Oppo Great sound and smooth power delivery in a heavier RWD or AWD vehicle is a nice blend, but current V8 pickup trucks deliver an unsophisticated driving experience. I think a modern full-size pickup could be very well suited to a manual transmission.In reality, old school, revvy atmo engines pair best with manual transmissions because it's so rewarding to keep them in the power band on a winding road. Modern turbo engines have flattened the torque curve and often make changing gears feel more like a chore.
  • Chuck Norton For those worried about a complex power train-What vehicle doesn't have one? I drive a twin turbo F-150 (3.5) Talk about complexity.. It seems reliability based on the number of F-150s sold is a non-issue. As with many other makes/models. I mean how many operations are handle by micro today's vehicles?