By on July 31, 2006

ssr-jpg22.jpgWhen Alfred P. Sloan took the reins at General Motors, he had a clear vision of the company’s future: “a car for every purse and purpose."  Sloan’s business model– offer customers a wide range of vehicles across distinct brands and encourage them to move “up” within the portfolio– was wildly successful.  GM soon replaced Ford as US market leader, and never looked back.  Ninety years later, the same structure is in place, but the car market has changed.  And GM’s portfolio is part of the problem, not the solution.    

While most enthusiasts recognize the philosophy behind Sloan’s GM brand structure, few realize that each company within the GM fold used to have just ONE car in its line-up.  Even during the 50’s, in the middle of GM’s “golden years,” each brand had no more than two wheelbases and three body styles.  With such a limited number of models within each brand, overlap was minimal.  Moving “up-market” was simple enough; you took your old car and your new money to a different dealer.  

When GM started adding new models, expanding their offerings to cover bases like “compact car,” “utility vehicle” and “minivan,” they altered the dynamics of their business.  Despite this horizontal model spread, GM tried to hew to a vertical brand system.  Buick and Olds stayed true to their roots, offering two to three big cars (aside from the Cadet experiment).  But Chevy and Pontiac became their own worst enemies.  Chevy dealers currently sell over a dozen different vehicles over a wide spectrum of price points, from $10k econoboxes to a wide range of pickups to $70k sports cars.  At the same time, Pontiac’s place in GM’s firmament has become unclear.

The problem isn’t so much the sheer spread of vehicles– most companies’ “main” brands spread as far.  The problem is that Chevy is still selling only discount cars, even though it embraces up-market price points.  GM’s other divisions also have a discombobulated product mix.  Pontiac exists in the gaps above each Chevy price point.  Cadillac is still perched at the top of the market, but their line shows little commonality (save a bit of “bling” here and there).  Product overlap is endemic for all divisions.  Actually, it isn’t so much overlap as “strangulation”.  Chevy is trapped under the new trinity of Pontiac/Buick/GMC.  For every Chevy, there’s one or more up-market counterparts it dare not exceed. 

Where once you chose your GM car with your pocketbook, now it’s more a matter of taste.  GM’s website illustrates the point perfectly; enter a price range into the “shop by price function” and you get a list of differently-sized models and vehicle types across several brands.  If a GM car buyer wants a certain type of vehicle or a vehicle at a given price, they have to shop at least two and quite possibly four GM brands’ dealers to see all their choices.  Otherwise, they could end up being steered to an inappropriate vehicle– and we all know what that does to a brand. 

Acting like it’s still 1955 has left GM with a huge product line that’s full of holes, along with “boutique” brands scattered about like polka dots.  This so-called strategy’s lack of focus robs Chevy of the quality it needs to be a reasonable alternative to the price-sensitive end of their “foreign” competition.  It restricts Pontiac, GMC and Buick to marketing cars “better than Chevy” (a standard that keeps slipping lower).  It detaches Cadillac, Hummer and Saab from the ownership ladder.  In fact, GM’s brands don’t just steal sales from each other; they pull each other into a pit of mediocrity.    

GM’s oversized dealer network makes the problem worse– and solutions problematic.  One answer: make some of the marques into models.  Instead of trying to keep Buick and Pontiac alive with a tiny line-up and a huge dealer network, GM could fold their products into Chevy’s portfolio.  The top trim sedans in the largest two sizes could be called Buicks, while a Pontiac would denote a performance model (the GT’s not the SS’s).  GMC could go back to its commercial customers.

To make this realignment fly, GM would have to transform all Chevy and all Pontiac/Buick/GMC dealers into Chevy dealers, all selling the same full line.  The remaining single-marque dealers would be retired (a more affordable prospect than killing the two networks).  Of course, there would be a severe dealer shake-out afterwards; only the strongest Chevy stores would survive.  But that’s no bad thing. From a corporate perspective, the biggest loss would be less presidents, a smaller ad budget and a less burdensome bureaucracy (oh darn). 

This brand consolidation would allow GM to offer a car for every “purpose” and most “purses” under a single roof.  Alfred Sloan would spin in the grave at the idea, but it just might work. 


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46 Comments on “GM’s New Brand Strategy: Chevy Uber Alles...”

  • avatar

    its interesting! With any large company, especially GM, it would be seen as catasrophic because of the amount of change needed to accomplish this. MY chevy truck has less than a dozen pieces different than its GMC brother, yet there are two different commercials, and two separate dealers here. I prefer GMC’s front end treatment, but for the same truck, I have to pay extra bucks. It makes no sense. If GM can transition to lean and mean, they can definitely turn around.

  • avatar
    Sajeev Mehta

    Sloan never intended to make cars like the Buick Skyhawk or the Caprice Classic: his business model allowed for a few Chevy models, a Pontiac, an Oldsmobile, a Buick or two, etc…I bet Sloan would be thrilled at fewer models per division in today’s economic climate.

    Andrew mentions GM’s boutique brands; which also applies to Ford. What’s the point of Lincoln and Mercury with Mazda, Jaguar and Volvo appealing to its original, pre-war target market?

    Good thing Sloan and Edsel Ford aren’t around to see this mess.

  • avatar

    Since the market is size-conscious, GM should base their models and marques on size, e.g., Chevy should sell the econoboxes, Pontiac the smaller sporty and fanily cars, Buick the larger sporty cars and near-luxury models, and Caddy should sell the large luxury cars and corporate exotics. GMC should handle trucks, SUVs and all the crossovers.

  • avatar

    I have serious doubts that GM will ever be able to turn this ship around, no matter how drastic the moves. It has yet to be seen if they can even make a well-built car that lasts and is worth the dough, and one that is sexy enough so buyers actually want it (except maybe a Cadillac or two). Maybe, if they weren’t putting a million eggs into a thousand baskets, they could straighten this mess out– but that’s a wicked big maybe.

    Still, I think the ONLY brands that should remain under the GM umbrella are Chevy, Pontiac, and Cadillac. Chevy should be the all- truck/SUV brand and offer ZERO pass cars; Pontiac would adopt the few suitable orphans from the other pass car brands and should focus on sex appeal and/or muscle; Cadillac would be exclusively high-end (SUV, pass car, whatever- as long as it’s dripping with luxe). GM should offer no more than 20 vehicles total, they should all be extremely high-quality, built to last, and have gorgeous, top-line materials in their interiors. Let all the Asian auto makers make perfectly fine and functional cars for the unwashed masses. If GM would return to their mid-century, design-leader roots they could really distinguish themselves.

    But they have so many other fires to put out, how can they possibly accomplish, well, anything?

  • avatar

    I think there should be 3 diff dealers. Chevy/Pontiac/Saturn; Saab/Caddy; HUMMER/GMC. That way if you want a car you go to the Chevy/Pontiac/Saturn Dealer, if you want a luxury car you go to the Saab/Caddy Dealer and if you want a truck or SUV you go to the HUMMER/GMC Dealer. plain and simple. I could see cutting Saturn, Saab, Buick and maybe GMC since Hummer has a much stronger brand presence. Regardless of how they do it the General needs to cut some deadweight.

  • avatar
    jerry weber

    schmu. you have hit the nail on your chevy gmc thing. They are identical trucks sans grille, and have two different: dealer networks, advertising, parts depts, brochures etc. GMC only made sense when they had a medium and heavy duty diesel line,including busses. and they wanted to give those heavy truck dealers a shot at a few pickup trucks and vans. As a stand alone franchise,with today’s light duty product it is unnecessary. Back in the 1960’s the last justification went like this. Even though the gmc is a chevy at heart, the gmc salesman told my father his truck has more welds per foot then a comparable chevy. If it were ever true it isn’t now. To have a gmc halo pickup at the top of the chevy line would be okay but only as a model.

  • avatar

    Getting my drivers license in the late ’70, Chevy was always synonymous to me with, ahem. value……….
    The value has long since moved elsewhere and the reputation of chevy cars is on a balancing act, with no safety net between the Corvette and oh, lets be generous, the Impala. From the looks and the technology the latter is purely: blah!! OH, NO!! Seems that the Impala shoe has just lost its grip on the tightrope!!!!!

    Goodbye Chevy!! The old ones will be missed!!!

  • avatar

    Since I stumbled on to the TTAC site, I have spent more time with it than any other in recent memory. The writing, especially by RF is extraordinarily good.
    My prime interest is in the area of corporation and auto history. I have developed a fairly well stocked shelf in my library devoted to same – especially GM, Ford, Chrysler, Studebaker, and Packard. The series on GM has been utterly fascinating. I look forward to each new posting. They are well stocked with chuckles and some outright laughs. One such, the best to date: GM’s Board of Directors referred to as “Board of Observers”. Great

  • avatar

    My take:

    Chevy: Minivans, econoboxes
    Saturn: Picks up where Chevy leaves off, small / midsize sedans
    Pontiac: RWD-only, driver-oriented sports sedans (think: BMW-lite) small / midsize
    Saab: Mercedes C – Audi A4 / Convertible – BMW 3-Series / Convertible competitors, two base cars: a sedan and a coupe / convertible
    Cadillac: Mercedes E-Class / CLK – Audi A6 – BMW 5-Series / 6-Series competitor, 1 luxury sedan, 1 sports-oriented sedan and one coupe / convertible
    Hummer: perfect as is
    GMC: SUV’s and cross-over vehicles
    Corvette: is a separate brand onto itself, with variations of 1 model, convertible, strip-down coupe, etc…


  • avatar

    As much as we might understand a restructured GM with each brand specializing in something, how could GM possibly explain it to the public? Unfortunately, I think some brands must be killed. Buick and Pontiac must go and their “types of” cars should be marketed under Chevrolet. Saturn and Saab are the two strays. With the best looking cars, there is really no point in having them compete against Chevrolet. Instead, they should have those companies working on taking their skills in design and engineering to making Chevrolet much more presentable. Hummer and Cadillac should be combined. The herd must be thinned and brands sacrificed. Also- The dealer structure needs to be changed. No haggle pricing would change the entire image of the company.

  • avatar
    Jordan Tenenbaum

    Buick is needed though to compete in the entry level luxury class which it could very well do, if they only did their homework. Buick with a minivan? Seriously who thought that was a good idea?

    The General to me seems like that kid. You know, the one in class who thought everyone was talking about monkeys when they were actually talking about elephants. The kid who turned in their homework two days late. The kid that fell asleep in class when an important discussion was going on.

  • avatar

    Forgotten here is a couple of factors why GM’s brands are so bloated: 1) less-than-desirable products and 2) the UAW. OK, make that three factors: the dealers.

    In order to keep UAW workers employed despite the fact that buyers prefer not to buy GM’s products unless bribed, to keep the factories humming GM has to spread its investment over more models, hoping the people are, in fact, easily fooled. This kind of thinking is why we have virtually the same minivan design spread over four brands.

    Then you get the predictable I-want-one-too mentality of the dealers. Suppose Pontiac gets a decent roadster to sell. It isn’t surprising to see, say, Saturn’s dealers begging to sell a version. Which folds nicely in GM’s need to maximize its investment.

    My version of Kappa would’ve made the Sky a 2+2 to avoid obvious comparison, much less cannibalism. (How big is the 2-seat roadster market anyway?) And Chevy would now be building the Nomad concept. See–one platform, less obvious badge engineering, distinctive products for each brand. How simple.

    To its credit GM is finally realizing that blatant badge engineering is a bad thing, but that didn’t stop Pontiac dealers from begging for a Cavalier -um- Cobalt clone.

    The solution, like the problem, is multi-pronged. 1) Build cars that people want to buy w/o the need for bribes. 2) Shrink the dealer population, ultimately allowing GM to kill a brand or two. 3) Focus each (remaining) brand’s mission a lot more precisely.

  • avatar

    The herd must be thinned and brands sacrificed
    The shutdown of Oldsmobile cost the General in excess of 1 billion dollars, lots of it payoffs to jilted dealers. I believe some lawsuits are still ongoing, years afterwards.

    GM doesn’t have billions more to spend at this time, and you simply can’t combine/shed/shred dealers at will due to strong state-to-state franchise laws. Brand and dealer consolidation is near impossible without bankruptcy, so, the Deathwatch continues…

  • avatar

    Good analysis. The one thing often overlooked when analyzing GM is that their dealer network is as much a financial liability, in many respects, as their employee/retirees. Each line has a lot of models so that all the dealers will have lots of things to sell. At some point in the past, the decision was made to have several, large GM dealers competing with each other in a market rather than one mega-dealer selling multiple GM brands. Of course, it hasn’t quite worked out that way. These large dealers could not survive on a severely curtailed product line.

    I imagine it cost GM a bundle to pay off dealers when it killed Olds. Do you know what GM requires of a dealer as far as facilities, parts and inventory investment? Have you ever talked to a smaller market dealer, who had to go hugely into debt to keep his franchise (excuse me, dealer agreement)? If, after saddling all their dealers with such debt, GM just shut down lines and dropped dealers, the lawsuits would be biblical.

    So, now they have painted themselves into this corner. Some would say that this is the inevitable result of years of corporate arrogance. The only solution to downsizing may be Chapter 11. And GM would not be the only one filing.

  • avatar
    Martin Albright

    As someone who has never worked in “the industry”, I, too, would be curious to know what the relationship between the dealers and GM is. I assumed (erroneously, I guess) that the dealers were franchisees and that there was some sort of term to the franchise agreement that would allow GM to simply ‘run out the clock’ on less desirable dealers and/or brands. It seems ridiculous (to me, non-industry person that I am) that GM should have to keep building vehicles that ultimately hurt their ability to compete, simply to keep their dealers happy.

    Though I guess it’s no more ridiculous than paying workers to sit around in the “Job bank” and do nothing.

    Maybe someone should send these guys back to business school?

  • avatar

    I tend to agree with the majority of these observations. GM needs to seriously re-think each of its “brands” specific purpose in life and then redirect its products to the appropriate brand. Of course this means there needs to be a corporate understanding, a readily available, razor-sharp definition, of just what it means to be a Chevrolet, or a Buick, or Pontiac product.

    I think it would be interesting for someone who is familiar with the complete GM line to look at what a vastly trimmed-down GM product offering should look like; car by car, brand by brand. I suspect GM could survive, if not thrive, with only HALF of its current line of cars and trucks, and perhaps half of its current brands consolidated or deleted altogether. I realize this sort of consolidation would be impossible without GM filing for Chapter 11 bankruptcy, but just what is it that could rise from the ashes? The future may not be that bleak after all.

    And, for what it’s worth, our Saab was purchased at a Saab/Cadillac dealer; it is an excellent arrangement as both of these car manufacturers seem to be appropriately up-market. Having seen both products side by side, I think GM would be silly to sell-off Saab; nicely innovative cars with plenty to offer at a reasonable price.

  • avatar

    n2f writes:
    I suspect GM could survive, if not thrive, with only HALF of its current line of cars and trucks, and perhaps half of its current brands consolidated or deleted altogether.

    Yeah, if they can produce anything attractive. In the early ’90s, Saturn was selling a couple of hundred thousand copies of one model (the SLx), because the car had a real identity, some attitude, and some sportiness. Now, it’s selling fewer copies total of 3-4 different models, because they’re selling bland stuff.

  • avatar

    Agreed. But the Pontiac Solstice, while not universally praised as aesthetically pleasing, is at least a sign of GM wanting to try something different, i.e. NOT bland.

  • avatar

    I’m going to get a bit wacky, but here is what I’d do.

    GM would be remodeled to have these brands/cars. I’m picking these based upon my current perception of the sub brand and the community good will each has.

    Sports Cars
    Brand: Corvette
    Models: Cx Supercar, RWD Impala or other Charger-competition, Camaro/Monte Carlo/GTO (pick one), G6, Sky, Fiero (non-convertable), SSR

    Standard Cars
    Brand: Chevrolet
    Models: Lucerne/Malibu, Cobalt, Aveo, Ion, Uplander (minivan goes here…), Vibe

    Luxury Cars
    Brand: Cadillac
    Models: XLR, 9-3, CTS (+V), STS (+/- V), DTS (+/-)V

    Brand: GMC
    Models: Avalance, Silvarado, Colorado, Savannah, Suburban, Tahoe, Trailblazer, Equinox, HHR

    Luxury Trucks
    Brand: Hummer
    Models: Escalade (base, EST, EXT), H2, H3, 9-7x, Luxury Minivan/Van if the market moves in that direction.

    That lineup gives you competition for every garage and wallet, allows sane platform sharing , and isn’t confusing as to what brands offer what products. It maximizes the brand-presence and current brand image (at least in my eyes) of the current GM lineup.

  • avatar

    There has always been a certain commonality between GM brands. The problem in how it was done took root over four decades ago with one of the most famous cars ever produced by a GM division, then was exasperated when Roger Smith became CEO from 1980 through 1990.

    It was during Smith’s reign that the GM divisions really lost their individuality. But it wasn’t really Smith’s fault. He just carried on the corporate meddling that was a direct result of none other than the ‘father’ of the GTO, the late John Z. DeLorean.

    When DeLorean did his end-run around corporate policy by bringing out the GTO as an option package rather than a specific model in 1964, he was on the verge of being fired. The trouble was, the GTO turned out to be a runaway hit. So instead of being fired, DeLorean became a legend.

    However, GM corporate would exact their revenge by making sure something like the 1964 Pontiac GTO would never happen again. The result was the 1971 Chevy Vega, GM’s first ‘corporate car’. This was really the beginning of the end for GM. That’s when the GM divisions really lost the say-so in what they were able to produce. DeLorean would leave not long after to start his own, ill-fated car company.

    The downfall began in earnest in 1975 when the Chevy Vega was rebadged to create the identical Pontiac Astre. But 1975 was also the year that the Vega-based Chevy Monza, Buick Skyhawk, Oldsmobile Starfire and Pontiac Sunbird were all introduced. All of these cars were identical except for different grills and some interior and chrome trim.

    Compare this to how the compact Chevy Nova was spun-off to the other divisions in 1971. The Nova, Pontiac Ventura, Buick Apollo and Oldsmobile Omega all shared certain body panels but they all had their own, individual division’s drivetrains. These cars were the last vestige of how the old, Alfred P. Sloan GM operated. Unfortunately, with the 1975 models, GM would follow suit and all Nova-based cars would simply have different grills and minor exterior and interior trim.

    It was when Roger Smith arrived in 1980 that GM ‘badge engineering’ would go to extremes. The Vega-based Monza cars were replaced with the even more identical J-car Chevy Cavalier, Oldsmobile Firenza, Pontiac J2000 and Buick Skyhawk in 1981. The low point was the J-car-based 1982-1988 Cadillac Cimarron. GM is been paying a hefty price now for the short-term profits realized through the decisions made by Roger Smith during his tenure as head of General Motors in the eighties.

    Until GM is able to have truly individually identifiable models the way Sloan intended (as in prior to 1975), they’re certainly doomed.

  • avatar

    It’s always been my thought that the decline of Oldsmobile was traceable to two cars: the Cutlass Ciera, which stayed around just a bit too long, and the Saturn, which leached off the sort of customers Olds really needed.

    The Ciera spent a decade and a half crawling downmarket. By the end, what had originally been a decent semi-luxury compact wound up as a boring, dowdy fleet car. The Saturn appealed to exactly the sort of people Olds should’ve been after, except that one sight of the Ciera would’ve sent those customers running for shelter.

    In 1982, the Ciera was a good alternative to cars like the Honda Accord and the Toyota Cam . . . wait, there wasn’t a Camry in ’82. By the Ciera’s last year in 1996, Honda was on its third Accord generation since ’92, and Toyota had already done three generations of Camrys. Oldsmobile still had pretty much the same car they’d been selling since a year before “The A-Team” premiered.

    That’s how a brand which once stood for upward mobility came to stand for corporate motor pools. Saturn has now crawled into Oldsmobile’s demographic space, but in the end, you wonder how much GM has spent to shoot itself in the foot.

  • avatar
    Brian E

    It’s a lot of fun to backseat drive (and I mean that in a good way) GM in the US. However, a lot of these articles seem to overlook the rest of the world. GM has Chevrolet competing with Vauxhall in the UK. Cadillac is struggling for a foothold by directly badge-engineering Saabs. I’m not familiar enough with the European market, or the world market in general, to sort out the whole mess.

    A lot of the brand revitalization strategy I’ve seen places Chevrolet as the key Toyota / Honda fighter. In my mind, this battle can’t be fought anymore. Toyota and Honda’s small and midsize cars have moved too far upmarket to be truly entry level anymore. Now that Hyundai is offering reliable, functional cars at a lower price point, GM needs to aim Chevy straight at the Koreans, and leverage Daewoo to do it. It’s gutsy, but it’s the only strategy I can see that puts GM’s lineup in the place it needs to be to attack the Koreans on value and the other domestics on price.

    That leaves open the role of the mid-market Toyota / Honda fighter, which I think its already defining itself. I was driving into work the other day and I was surprised to see a dozen or more Pontiac G6 sedans in the parking lot. It’s an unexceptional car to the pistonhead, but so are the Camry and Accord. The exterior styling is precisely the right kind of inoffensive pastiche that manages to be both recognizably Pontiac and blandly modern at the same time. The interior actually doesn’t suck. I don’t care if Pontiac goes RWD or not. As a matter of market position it needs to stack up in the middle of the market. The mid-market truck brand belongs to GMC, which helpfully is already combined with the Pontiac dealer network.

    This leaves Saturn among the mass-market marques. Whereas it would once slot as the Korean fighter, its transformation into the American marque for Opel places it in the same margin of the market that Volkswagen currently occupies. The Passat is a nice car, but I doubt very many Camry and Accord shoppers are drawn into VW dealers. The type of buyer who shops a Passat for the European design and dynamics but doesn’t have the means (or the ego) for a luxury marque is Saturn’s new target. The much-maligned L-series was underrated because its bland exterior and interior and horrid reliability (another VW-ish trait), but it handled well enough to convince me that Saturn Opels can succeed in this niche.

    Buick should be killed immediately. GM plans to turn this into a Lexus fighter. GM does not need a Lexus fighter. Luxury brands are about identity, and a Lexus knockoff is not a luxury car. Buick’s only surviving identity is a car for folks who remember the 50s and 60s as their prime years, not their childhood. Needless to say, this is the very definition of a dying market.

    One thing GM has been able to competently do is to give Cadillac an identity of its own. As a luxury marque it should be aligned with Pontiac, akin to Toyota / Lexus and Honda / Acura. Saturn is aligned with Saab, and Saab’s products should be taken further upmarket to distance themselves from their Saturn cousins. Chevrolet already has its luxury alignment: Hummer.

    The resulting brand strategy does have a car for every purse and purpose. The alignments of Chevrolet / Hummer, Pontiac + GMC / Cadillac, and Saturn / Saab only overlap in price on the margins, and appeal to three distinct sets of personalities: the utilitarians (male bias), the image-conscious (female bias), and the Europeans and like-minded folks (whatever).

  • avatar

    GM is configured as a manufacturer of cars that has 40 to 50% of the domestic market operating with a 24% market share. The business model is hopelessly out of alignment with the changed global car market. It has redefined the concept of losing money. It competes against itself at many levels. It is locked into crippling legacy costs both in it’s dealership structure and it’s unionised employees. It has backed itself into a corner and it has bet the farm on new vehicles which are exactly the type nobody will want due to their high fuel consumption. It is selling off the family silver (GMAC) and pawning it’s assets to secure loans. In short, it will take a miracle to keep it alive in it’s present shape. Years of mistreating it’s suppliers, it’s dealers, it’s customers (and some would say it’s employees) has left it with a reputation of being an arrogant company who many individuals and businesses refuse to have dealings with. The GM name is damaged and not associated with quality, style, efficiency or reliability. It is notorious for not honouring warrantees and like it or not it has created a breed of people (in large numbers) who have a real hatred for GM and it’s products and who would not drive a GM car even if they got it for nothing. All this is their own doing. To survive they will have to address all of these issues at the same time. I sure feel sorry for Mr. Wagoner because he has an enormous task ahead of him and whether any one man can turn this mess around is far from certain. GM needs a born-again experience, it needs to see the light and it needs to acknowledge it’s past sins, obtain forgiveness and repent and move on with a different attitude. Please excuse the religious metaphor but it seemed the most appropriate to illustrate the magnitude of change needed here. Will it happen? I don’t think so but that’s me and this is one area I would love to be proved dead wrong.

  • avatar

    GM has a lot of brands. But not enough.
    For instance, their brands are mostly very macho and blue collar.
    What is a female to choose from GM?
    Or, which GM brand can serve you if you’re looking for ‘refined excellence’?
    What if you’re looking for ‘high tech’?
    What about ‘smart fuel efficiency’?

  • avatar
    Lesley Wimbush

    Ummm…you’re kidding right?
    I know several females that drive full size Silverados, but if you want to stereotype, how about the Solstice, Sky, HHR, Cobalt, Aveo, Optra, Malibu Maxx ??? none of those are particularly macho.

  • avatar
    Terry Parkhurst

    As I recall hearing in a “Frontline” show concerning GM on Public Broadcasting System, in 1957, one half, maybe as much as three-quarters (my memory is shakey on the number, since this show was on about 10 years ago and I didn’t take notes) of all cars GM sold in that year were Chevrolets.
    It was a time when the late Dinah Shore helped introduce the new Chevrolet line on her television show and sang, “See the USA in your Chevrolet.”
    With certain groups – especially Latinos – Chevrolet is a marque to be proud of, not a brand like a toothpaste. I saw four Latinos today get out of a Chevrolet Malibu with California plates, at a coffee shop where I had stopped. I asked one of them how he liked the car and he said, “It looks a little like an Impala” (which admittedly, is what I thought it was, from the front end). “It’s a nice car.”
    The 1964 Impala, known as the “6-4” in some hip-hop tunes is an icon in the Latino community. And at Hot August Nights in Reno NV this week, the unofficial car of the event is the Tri-Fifities (1955 through ’57) Chervolets, all kinds. But capturing that old mojo might take more than a bit of work.

  • avatar

    1. Chevy’s lineup needs to more closely mirror Honda/Toyota in size. For example, Chevy has two cars (Malibu and Impala) competing in the Camry/Accord class from above and below. Nissan does the same thing with the Altima and the Maxima and it doesn’t work.

    They also need to start adapting Opel’s styling. It will be wasted on Saturn. Chevy needs it more.

    2. There’s still a place for Pontiac, as a “bold” alternative to a Chevy. Chrysler has proven that you can sell 300s AND Dodge Chargers, but the alternatives have to be truly distinctive.

    3. Buick line should be LaCrosse/Lucerne/Enclave. That’s it. Needs to stay focused on the soft, plush cars as an alternative to the now-sporty Cadillac image.

    4. Cadillac has successfully transformed it’s image. Not much to change here. There’s a common family look. All they need is a crossover upmarket of the Enclave.

  • avatar
    jerry weber

    I see hints of the UAW bashing creeps into some of the GM analysis. Just remember, a corrupt GM executive all througout the years had to negotiate and sign off on every one of those cock-0-mamie points like getting paid for no work. Let’s look back,should the Gm execs stayed off the golf course for a few days during contract season and god forbid took a strike rather than kick the can down the road to the present day? If the GM managers today can (because they must) make hard decisions, why couldn’t they do it back in the good old days? It is the unions job to ask for the sky, moon, etc, it’s the gm vice presidents for labor to say no.

  • avatar

    Great point: “Chevy???s lineup needs to more closely mirror Honda/Toyota in size. For example, Chevy has two cars (Malibu and Impala) competing in the Camry/Accord class from above and below. Nissan does the same thing with the Altima and the Maxima and it doesn???t work.”

    Never understood what the difference between the Maxima and Altima is since the Altima continued to move upmarket. Here GM is pushing a bunch of cars in the same class. Toyota and Honda have done well offering low (Civic, Corolla) middle (Camry, Accord) high (Avalon, Acura, Lexus). Even VW figured it out with the Jetta/Golf and Passat. Although the Phaeton is another story… GM needs to find a new strategy to fight these line-ups, because the current one isn’t working. Would anyone shop Camry v. Accord v. Altima (maybe getting crazy and checking out a Passat) and then look at Buick, Pontiac and Chevrolet? How much time do they have on their hands?

    Some brands must be killed (and surely contracts account for every possibility allowing GM some leeway). It will be expensive to fight and hard to sign settlement papers in the end, but a lot of dealers might be happy to get rid of their lesser performing stores too. Wouldn’t the cost of not designing, advertising, manufacturing and shipping a brand win out over some very high settlements?

    The problem with a Saab/Saturn alignment is that it makes no sense. Acura/Infiniti/Lexus/Audi all work because they were there before. They have always been upscale brands for Honda/Nissan/Toyota/VW. Now all of a sudden Saab is the upmarket brand for Saturn? Saturn has nice design, good dealers, fair prices and Saab is “born from jets?” Why not just merge them into a new brand kill the names and start over as the new European Opel? Until then its trying to combine parts that have nothing in common. This is the problem, it needs a complete revolution to combine/kill to survive.


  • avatar

    There’s nothing fundamentally wrong with bracketing the Camry with the Malibu and Impala. Choice is good. How many people want exactly the dimensions, trim, performance, etc, that the Camry offers? How many want exactly the dimensions, trim, performance, etc that the Camry offers but wouldn’t be willing to consider other options or compromises, especially at a savings? Every car decision is a compromise. Offering more models does give you more chances to win.

    GM has to offer exactly the reliability of Toyota (and find a way to persuade skittish former customers that they have the same reliability) but they don’t have to offer exactly the same car.

  • avatar
    Joe C.

    It’s very interesting to me that everyone has slightly or substantially different ideas about how to “save” GM. I wonder if this isn’t an indicator of how most boardroom meetings at GM on this same issue turn out: The various brand and line feifdoms scrapping for dignity and survival.

    I think that’s the real problem. GM has grown to (and maybe beyond) the point where it’s true: What’s good for GM is good for the US. Alternatively, what’s bad for GM can be very bad for the US.

    With every tremor at GM comes risk. If Buick goes off a cliff, dealerships close, somewhere production stops, thousands of jobs are lost, buyouts and lawsuit settlements impact Wall Street. To do nothing at all solves nothing and increases the volume of the death march drumbeat until it can’t be ignored by car buyers.

    Changes in GM strategy will have to be (at first) subtle, gradual and sensible in order to avoid collapsing the house of cards. But, will they have the assets to withstand a 5-year or 10-year resurrection plan?

  • avatar
    Don Whitefield

    Man oh man.

    You guys keep day dreaming about what GM COULD do when in reality there is nothing they CAN do. They simply do not have the cash anymore.

    First comes the bancruptcy, then come loooooooooooooong negotiations and THEN comes the re-structuring. And none of this is happening until Wagoner and his cronies go.

  • avatar

    some think the union is responsible, wrong. if someone has time to research the period of time gm started going downhill it most likely starts when the bean counters took over. when car guys take over and get back to the car business things will get better. the gm boardroom does not help either. business runs from the top down, not bottom up.

  • avatar

    One way for them to get out of the mess with the dealers is to change all of the dealers to “GM Stores”.

    Just like when you go to the grocery store, you choose from all of the brands they offer. We don’t go to the cold cereal store, then the peanut butter store, so why should we have so many different dealers?

    As an example, any dealer could offer any vehicle. This way corporate could manage ‘brands’ easier, including addition or deletion of brands. Set them up as the Saturn dealers are, no haggle pricing, nice showrooms, no plaid pants and white belt salesmen…

    Order your Pontiac Solstice LS4 (just a wet dream of mine) online and pick it up at the GM Store. Oh wait, can’t do that, thanks legislators!

    Some larger dealers have something similar to this, with the exception of the build to order and order online stuff.

    I see that my new Malibu Maxx has a little GM logo on each front door, I wonder if they’re thinking what I’m thinking…

  • avatar

    These are all great ideas, and keep them flowing, but Don Whitefield has hit the nail on the head. No large scale changes can happen until GM enters bancruptcy.

  • avatar

    So how much do those little GM logos cost, anyway? Tens of millions to design & stick on the millions of GM NA vehicles, I would guess, pocket change for a big multinational. Or is it?

  • avatar

    Holy crap.  Where is GM going to get the money?

    Synopsis:  If the legislation passes, GM will be required to <i>fully fund</i> its pension obligations within 7  years starting in 2008.

    Not from auto sales:

    Synopsis:  GM said its sales dropped 22.2 percent from July 2005 (trucks dropped 31.2 percent, cars 2.7 percent); Honda and Toyota sales increased.

  • avatar

    GM needs to go. This can be discussed all day but the reality is for the most part they dont build cars anyone wants. I am not sure what the designers look at but they sure dont look at foreign cars. After having lived with numerous Japanese and German cars and you get into the average GM car you wonder just what the heck they were thinking about.
    GM has been all about badge engineering for along time. The public all knows that they are all the same cars under the badge. This has recently carried over to poor Saab. What was a European sports sedan is now selling rebadged SUV's and rebadged Forresters.
    Just what where they thinking about?
    I will tell you. Its all about making the quick buck. Get in, get out. This is not new, this is the American business mantra. They dont really care about their customers, they care about making $$$. I can point to  numerous other American companies that are in the same boat.
    What people dont realize is that the rot starts at the top and flows downhill. Always has and always will. The executives are there to make the most $$$ while they can and than get out. Which is exactly what they are doing. Fideling while Rome burns. 
    When the company is long dead and buried the executives will all be out playing golf toasting themselves and the money they made on the suckers out there.

  • avatar

    GM To Do list

    -Drop Buick

    -Drop GMC

    -Drop Sabb

    -Hire Audi interior department

    -Hire the guy that Designed the Alfa 8C

    -Devlope Brand identity/restructure Dealers

       Saturn: Entry Level (Kia/Hyundia)- Miro Small and Medium car, Small SUV, Minivan

       Chevy: Middle Level (Honda/Toyota) Small car, Medium Car, Large car, Small SUV, Medium SUV, Camaro, Corvette

       Pontiac: Performance- Solstice, GTO, RWD Sedan

       HUMMER: Trucks- Small, Medium, Large Truck, H3, H2

        Caddy: Luxury (Audi/BMW) – CTS, STS, XLR
    anything else is dead weight. Let the UAW go on strick and hire none union works to take ther place. maybe then GM could be competative in the price game.

  • avatar

    "There’s nothing fundamentally wrong with bracketing the Camry with the Malibu and Impala. Choice is good. How many people want exactly the dimensions, trim, performance, etc, that the Camry offers? How many want exactly the dimensions, trim, performance, etc that the Camry offers but wouldn’t be willing to consider other options or compromises, especially at a savings? Every car decision is a compromise. Offering more models does give you more chances to win."

    It's also a matter of using resources wisely and recognizing what is successful. Eventually you come to realize that the market has decided that Camry/Accord size is "just right." You adapt or die. Why spend the money to engineer and market two cars when you can fill the need with one? Nissan gets away with it with the Altima and Maxima because it's essentially the same platform.

    Platform sharing has forced GM into all kinds of awful compromises. The same platform that serves the "premium" LaCrosse underpins the "value" Impala. Neither fish nor fowl, and successful at neither. I'm not saying that platform sharing is inherently bad, just GM has tried to stretch platforms across too wide a spectrum.

    GM also has to learn that people don't want a Chevy that looks cheap. The Chevrolet used to be admired for looking like a "small Cadillac." Now they seem to go out of their way to make them look dumpy. Maybe if a Malibu was actually attractive no one would step up to a G6? Who honestly designed the Malibu and thought, "Oh yeah, people are going to WANT that!"?

  • avatar

    I agree with fuzzyman and Brian E's perspectives on what GM is trying to do right now.
    Brian E's take on Chevrolet and Saturn are spot-on.
    I agree with Fuzzyman's take on Buick and Pontiac.
    Saturn is well on its way to being the poor man's VW (in a good way): a little less stylish, a little less expensive, and a bit more reliable. That's a legitimate business niche. 
    A corollary to Brian E's take on Chevy being downmarket from Toyota: GM should consider moving Chevy even FURTHER downmarket. Toyota, Hyundai, even Kia keep moving upmarket. Even if the interior trim isn't actually getting better, they keep pretending to make it better…Everyone wants to be upscale. There's actually a growing vacuum at the bottom for no-frills, bare bones, but dependable line of cars.
    If you're not convinced, let me just say this: If Chevy doesn't go downmarket, Chinese manufacturers will gladly go there soon. 
    Tto be clear, GM shouldn't let Chevy become the new Yugo. The brand will stand for durability and dependability without frills and will maintain a respectable image with halos;  the occasional quirky car (HHR), Camaro and Corvette.
    Pontiac is well on its way to being urbanish, sportish, Mazdaish, Nissanish in sensibility. The G5, like Dolly, is an unsettling form of cloning, but the dealerships need a compact to sell, I suppose.
    Buick is being kept alive just for the dealerships. But there is lemonade to be made from this lemon. LaCrosse, Lucerne, Terraza, and Enclave. Not a bad limited line up to defend the Oklahoma to Indiana, Michigan to Missouri middle American states. Make sure they all have available AWD, standard turbo front & rear defrosters, hot windshield wiper fluid, headlamp, side mirror defrosters, and remote starters and Voila! You've got a winter-mobile for the Mid-American masses. They'll sell about a dozen in California, but who cares…Buick will be a strong Mid-American niche vehicle. It's stuck in that niche now anyway, so instead of running away from it, embrace it…
    I've got to stop smoking this joint now… until next time…=)

  • avatar

    Several people have suggested dropping Buick.  The problem with that is that Buick is the division building the attractive cars.

  • avatar

    Warning: Here comes another "backseat driver" with ideas of how to save GM!

    For years I've always felt that GM should create a strong GM brand, and with the exception of Cadillac, relegate the makes (Chevrolet, Pontiac, etc.) to being model names.  In fact, with GM badging now appearing on all 2006 models, you wonder if that's not the direction in which they're heading.  For legal reasons this wouldn't work unless a bankruptcy reorganization were to occur (the dealers would scream bloody murder), but think of the possibilities if six to eight platform teams were creating the best damn dozen or so vehicles possible, instead of almost 50 vehicles built off of a dozen or so platforms.  The lineup at my GM dealerships would look something like this:

    SATURN: Stylish subcompact in the Mini/Fit/Yaris mold
    CHEVROLET: Solid compact along the lines of Civic/Corolla; build a small crossover (like the Vibe) from this platform, and include a Solstice-like roadster at this level
    PONTIAC: High-value mid-size sedan, coupe and convertible a la Accord/Camry; build a crossover off of this platform
    BUICK: Rear-drive large sedan; more emphasis on substance than gimmicks
    CORVETTE: Sports car

    Maybe revive the Oldsmobile name as a front-drive sedan slotted between Pontiac and Buick.

    Ditch GMC and Hummer, and use the Chevrolet model names for two trucks (Colorado and Silverado), two vans (Uplander and Express) and two truck-based SUVs (Blazer and Suburban).

    Keep Cadillac intact, and use Saab as an engineering resource (maybe keep the brand alive in Sweden).

    Less development costs, less marketing costs, less internal competition.  Makes perfect sense…which is why it will probably never happen.

  • avatar

    Occupants Drive Available Transmission Price
    Body style Engines Axle ratios Range Models WB

    4/wagon front 2.4 I4 5/auto 3.55 3.90 $13K – $17K Chevrolet Fleetline 104″
    4/sedan front 2.4 I4 5/auto 3.55 3.90 $14K – $18K Pontiac Tempest 104″
    4/coupe rear engine rear 2.4 3.5 5.3 6/smg 3.31 3.07 $19K – $27K Pontiac Firebird Formula Trans Am 108″
    2/targa mid engine rear 6.6 V8 6/smg 3.31 $45K – $55K Chevrolet Corvette 108″
    2/retractible mid engine rear 7.2 V12 6/smg 3.31 $65K – $70K Cadillac XLR 108″
    5/hatch coupe front/all 2.4 3.5 4.8 5/auto 2.73 2.41 $18K – $24K Saturn Starfire 108″
    5/sedan front/all 2.4 3.5 5.3 5/auto 2.73 2.41 $19K – $28K Chevrolet Malibu Impala Monza 108″
    5/sedan front/all 3.5 5.3 5/auto 2.73 2.41 $22K – $33K Pontiac Executive Bonneville 112″
    7/wagon (glass roof) all 3.7 5.3 5/auto 3.07 3.42 $22K – $29K Buick Skylark Skyhawk 112″
    2-6 “pickcoupe” rear 4.8 V8 6/auto 2.29 3.07 $18K – $29K Chevrolet Camino 116″
    4/5/coupe rear 6.6 7.4 hybrid 2.29 2.56 $40K – $50K Cadillac Coupe de Ville Eldorado 116″
    5/hardtop 4/retractible rear 5.3 6.6 6/auto 2.29 3.07 $25K – $35K Pontiac 2+2 GTO 116″
    5/6/sedan rear 3.7 5.3 hybrid 2.56 2.73 $24K – $30K Buick Elektra 225 Super 323 116″
    5/sedan rear 5.3 6.0 hybrid 2.29 2.56 $27K – $38K Saturn Starfire Rocket 120″
    5/sedan rear 3.7 5.3 hybrid 2.29 2.56 $27K – $38K Buick Century Wildcat 120″
    5/6/sedan rear 6.6 7.4 hybrid 2.56 2.73 $45K – $65K Cadillac Seville Deville 120″
    5/6 sedan rear 3.7 5.3 hybrid 2.56 2.29 $35K – $45K Buick Regal Riviera 124″
    8/9 wagon rear 6.0 V8 6/auto 3.07 $30K – $40K Saturn Spacecruiser 124″
    5/6 sedan rear 6.6 7.4 hybrid 2.56 2.29 $50K – $75K Cadillac Fleetwood Eldorado 124″

    Engines HP at RPM

    2.4 ohc I-4 150
    3.5 ohv V6 220
    3.7 dohc V6 275 Buick exclusive
    4.8 ohv V8 290
    5.3 ohv V8 325
    6.0 ohv V8 365
    6.6 ohv V8 400
    7.4 dohc V12 550 Cadillac exclusive

    One engine per model name – no optional engines

  • avatar

    KingElvis, what’s with all the pushrod motors?

    And why not have engine options? Maybe not dozens but two or three. People have different needs, make different choices available.

    Let’s bring back final drive ratios as options, too.

    I’m fairly certain that my Dad had a choice of engines and final drives on his ’69 Ford wagon (the only car I saw him buy new, a choice he regretted forever after). I believe the options were an I-6 of some sort, a 302, a 351 (his choice), a 390 and a 429.

    Of course, if you’re going to have engine options, it would be best if they were all good engines.

  • avatar

    The idea is to make the brands more “exclusive” by restricting engines to certain models and/or brands. It’s part and parcel of preserving Buick and Pontiac – they have to offer something you can’t get on a Chevy.

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