By on December 9, 2009

No, you drive shotgun...

Autoextremist Peter DeLorenzo is an interesting figure in the auto commentary landscape. Though TTAC has often taken the pioneering car blogger to task for inconsistencies (especially during bailout mania), it’s no surprise that DeLorenzo’s ability to see things as they are comes and goes. After all, the guy is the quintessential insider’s outsider: as a former marketing and ad man, the Autoextremist is always in the Detroit tent… the only question week-to-week is whether he’s going to be pissing out or pissing in. Well, this week the deluge is headed straight for the part of the tent occupied by GM’s new CEO Ed Whitacre and his activist board. And it smells of well-aged vintage Deathwatch.

But before I get into Whitacre’s executive moves, you’re probably gathering I’m not buying “Big Ed’s” act, and you’d be right. After doing some digging around Whitacre’s previous executive life at AT&T, it’s easy to come away with a highly unflattering portrayal of GM’s “interim” CEO. First of all, the “aw shucks I’m just a country boy who has a few good ideas” persona is total bullshit. In his previous executive life Whitacre was known as an arrogant know-it-all who was never wrong, never listened to reasoned advice and who brought absolutely nothing to the table of his own on a day-in, day-out basis. Shocking? Hardly. Anyone who thinks The Peter Principle isn’t alive and well in corporate America today is kidding themselves.

But DeLorenzo didn’t have anything to say about Whitacre’s biggest moves, like his cancellation of the Opel sale or the recent China-India strategy shuffles. Instead, Whitacre’s executive shuffling took the top billing, and the biggest gripe of all is over Bob Lutz’s downgrade to “senior adviser” status. In fact, the demotion was so bewildering in light of DeLorenzo’s (and frankly, every “car guy” analyst’s) hero worship of Mr. Maximum, that things descend quickly into revisionist history.

As for Bob Lutz’s new “advisory” role? This announcement was made in preparation for Bob leaving the company at the end of this month. Lutz was originally going to leave at the end of this year but then last spring he and Fritz got to talking about what he’d like to do when he did leave, and that’s when Bob mentioned that he’d like to keep his hand in product development and design, but that he’d really like to take a shot at revamping GM’s marketing, which he viewed as one of the company’s weakest links (he was right, of course). One thing led to another, and all of a sudden Bob was Vice Chairman in charge of marketing for GM.

Bob was slated to stay in that capacity at least through the end of 2010, but it was no secret that he has become less than enchanted with developments down at the RenCen of late, so he has decided that now would be a good time to end his day-to-day involvement in this business. But Bob isn’t going away by any means, so no premature career send-offs need to be written. He will continue to advise GM on product development and design, and – seeing as I consider him to be the top product guy of the last 40 years in this business – that will be a very good thing for GM, or at least it should be if they continue to listen to him. But remember what I said about “Big Ed’s” listening skills?

So MaxBob stepped down because he “has become less than enchanted with developments down at the RenCen,” but he’s sticking around as an advisor anyway? In the absence of a better explanation (let alone an official one), it’s tempting to believe DeLorenzo’s take… even if it’s hard to see the real impact considering Lutz isn’t going anywhere. Either way, we’d certainly have to agree with his assessment that Lutz’s replacement as top marketer, Susan Docherty, proves that

longevity in the GM system does not necessarily mean that there’s a dimension of success involved, it just means that an executive has survived long enough to make it to the next level on the “Big Magic Wheel” of executive job assignments.

And, as DeLorenzo concludes, marketing is too crucial to put in the hands of the person who green-lighted the “take a look at me now” Buick spots. After all:

the most crucial issue facing GM is the fact that a highly skeptical American consumer public is finding it hard to be impressed with GM’s excellent new vehicle lineup. And until that consideration needle is moved in a dramatically positive direction, the company will literally and figuratively be nowhere.

And it’s the one crucial issue that has not been addressed by Whitacre’s changes.

Why is that do you suppose? I’ll answer that one for you: 1. He doesn’t have the first clue at to how to go about it, and 2. Even if he did there’s no one currently in the building in the post-Lutzian era who is capable of taking them where they need to go.

There continues to be a massive disconnect between GM’s excellent new products and the ability or, more accurately, the inability of the company’s marketing minions to communicate their strengths in compelling fashion to an entire nation of consumers who are all of a sudden from the “show me” state of Missouri.

And until this company figures it out – or somebody is brought in to figure it out for the Board and “Big Ed” – then this company will continue chugging along in time-honored fashion, lost in its classic “M.O.” – the “two-steps forward, three back” dance of mediocrity – indefinitely.

Sometimes all a hammer can see is nails, and you can’t help but imagine that Marketing Consultant DeLorenzo is applying for the job of “somebody to figure it out for the Board,” but it’s still a valid point. Unlike Chrysler, GM already has a number of relatively competitive products on the market, but it’s still struggling just as hard to get out from under its loser reputation. Thanks to the bailout DeLorenzo and everyone else in the Detroit tent cheered for, escaping that reputation is about more than just marketing cars. And if, as DeLorenzo confirms, the bailout didn’t fundamentally change GM’s arrogance and ineptitude-fostering “magic wheel” executive culture, then it was as bad a deal for GM as it was for taxpayers.

The real critique, lurking unsaid beneath DeLorenzo’s savaging of Whitacre, is that Big Ed didn’t fire Lutz, Docherty and the other GM lifers when he booted Fritz. But, since that wouldn’t play well inside the tent, the argument gets watered down to “Whitacre doesn’t understand the business.” Which is like shooting the messenger for delivering only half of the right message.

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54 Comments on “Autoextremist: GM Is Screwed After All...”


  • avatar
    Aqua225

    This sounds like Farago in drag :)
    I don’t buy Autoextremist’s opinion on Whitacre. I think if he truly takes control, he may be the best thing that has ever happened to GM. Peter principle or not, he was evidently the right guy for the previous companies, and my guess is that the opinions of him were from subordinates who he managed. People’s whose opinions cannot be trusted. Either they will be too negative or too positive. When you look at CEO’s at this level, you have to look at the ethical stature of the company as he left it, and the amount of money it made under his control. If he was merely taking other’s ideas, then why weren’t those companies great before he got there? Sometimes it takes the right CEO just to recognize the right ideas.
    If something goes wrong, we the tax payers have his back, whether we like it or not. So lets sit back and see what happens.

  • avatar

    Wagoner, LaNeve, Lutz, and now Dewar. think Big Ed has been reading past editorials at GeneralWatch. now he needs to oust the last two remaining members of Gerosa’s Cadillac Mafia.

    then Return to Greatness…

  • avatar
    Gardiner Westbound

    The premise for DeLorenzo’s piece is many GM cars are just plain fantastic. All that’s needed is expert marketing, perhaps by himself, a legend in his own mind.

    There is no evidence buyers are poised to storm the GM ramparts to get at ’em as they are with Hyundai products. I won’t consider GM until there is solid long term reliability data or GM puts its money where its mouth is with an honest, 10-year, no-weasel warranty.

    • 0 avatar
      Brian E

      That premise isn’t entirely wrong. Many GM cars are quite good, and some are even fantastic. GM does suffer from branding and perception problems.
      That said, there are still significant product issues, and even some issues on the “good” products. GM is convinced that it can make Buick a Lexus competitor, but while the LaCrosse may compare favorably to the ES350 in higher trims they’re also making lower trim levels that really don’t belong in a luxury car – save it for the volume Malibu or Impala! And the Buick image is just horrible now, with very little effectual being done to fix that right now.
      Similarly the new Equinox is good but the Terrain variant really doesn’t work at all. The SRX doesn’t fit in with the rest of the Cadillac lineup – if the primary competition is the RX, then it should be a Buick. It’s not a bad car, but it’s got the wrong badge on it. Fixing that would enable GM to get rid of the Terrain since the GMC and Buick channels are now consolidated.
      Ultimately good marketing comes from a coherent brand message and GM is still missing what needs to be done on that.

    • 0 avatar
      segfault

      @ Brian E:
       
      The new LaCrosse has A-pillars that are nearly a foot wide.  How did that make it past the design department?  The Cheapuinox/Terrain’s base powertrain has such bad NVH that they had to add an active noise cancellation system to try to prevent people from complaining about it.  It gets impressive mileage, but it’s unclear why the highway mileage on those CUVs is the same as the lighter, more aerodynamic Epsilon cars that share the same powertrain.

    • 0 avatar
      200k-min

      I agree completely that there is no solid long term evidence that any GM vehicle can compete against their direct competitors save maybe full size SUV/Trucks and the Corvette.  Recently I rid myself of a 5 year old/80,000 mile GM vehicle that had more money dumped into it than an 11 year old 200,000 mile Honda.  My brother’s brand new Traverse has been in for “warranty” work about half a dozen times for various issues in less than 3 months.  These are things that people are sick of putting up with and why many people blindly buy Toyota/Honda.  Sure there are those that rave about GM quality, but for each of those guys there’s at least 2 just the opposite.

      And lets talk about current product.  Case in point, the new Malibu.  It’s much much better than previous vehicles it replaced but after driving one it’s no clear champion over the likes of the Camry/Accord, or even the Fusion for that matter.  Not considering quality at all, the vehicle itself is no “leap ahead” of the competition.

      As for Buick being a Lexus competitor GM is kidding itself.  I own a GS350 and can’t think of one model in the Buick lineup that compares in style, performance or historical reliability.  What does Buick have to compete against a flagship Lexus LS?  Positioning the LaCrosse against the ES350 is ok, but first you have to establish a loyal customer for the Malibu that will want a move-up option.  See above the problem there. 

      And if Buick is the Lexus competitor, what is Cadillac?  A BMW/Merc competitor?  So, if GM is clearly going after the ES350 market in the LaCrosse, do they also want to go after the 3-series market?  Splitting up resources doesn’t seem like a good idea for a company that’s not a leader today.  After all GM trying to be all things to all people helped get them where they are in the first place.

    • 0 avatar
      car_czar

      “There is no evidence buyers are poised to storm the GM ramparts to get at ‘em as they are with Hyundai products. ”
      No evidence other than selling more cars in the US than anybody else, I suppose….  GM has sold nearly 5 times the number of vehicles as Hyundai in the US this year, by the way.

  • avatar
    mtypex

    If you have a hammer, all problems are nails.  Those goes for marketing men and sales men.
    I like how we’re not talking about strategy here… it’s helping me update my resume.  GM will not survive if they cannot direct the product and the brands coherently and move them upmarket, that is away from the black hole that Chrysler is falling in.

  • avatar
    jimmy2x

    longevity in the GM system does not necessarily mean that there’s a dimension of success involved, it just means that an executive has survived long enough to make it to the next level on the “Big Magic Wheel” of executive job assignments.

    From my experience you could say the same about most large corporations.

  • avatar
    lw

    Read Whitacre’s BIO and tell me exactly how many large turnarounds he has successfully completed.
    That would be… zero…
    Now tell me how many large turnarounds he has attempted…
    That would be… zero…
    Tell me how many companies he’s parachuted into and revamped the culture from top to bottom…
    That would be… zero…
    Manufacturing experience?   Zero…
    How about managing complex global supply chains to produce a quality product?
    Well unless you think a Princess phone and a Chevy are roughly equivalent efforts to design and build…
    ZERO…
    So tell me exactly what qualifies him to do anything at GM?

    • 0 avatar

      “Whitacre was known as an arrogant know-it-all who was never wrong, never listened to reasoned advice and who brought absolutely nothing to the table of his own on a day-in, day-out basis.”

      That’s what qualifies him–sounds like a true GM man.

      John

  • avatar
    porschespeed

    DeLorenzo’s a fun read- because crazy, ill-informed, ass-kissing-cretins are entertaining. Much akin to a Maximum Boob release. Just can’t read it too often, it’s too sad and pathetic.

    “The knuckle-dragging, varnish-sniffing, low-octane, GM-press-release-truthiness”

  • avatar

    Give me a few bottles of wine, let me get drunk, and I’ll do a better job.

    Why? Because even when drunk, I have pride in our country.

  • avatar
    John Horner

    “In his previous executive life Whitacre was known as an arrogant know-it-all who was never wrong, never listened to reasoned advice and who brought absolutely nothing to the table of his own on a day-in, day-out basis.”
    BS. That characterization doesn’t fit at all with what Whitacre actually accomplished. He took the smallest  of the seven “Baby Bell’s” (Southwestern Bell Telephone) created by the original break-up of AT&T and used it to gobble up most of the other baby bells as well as what was left of the parent company. This re-constituted company was actually all owned by SBC, but Whitacre changed the name to AT&T because AT&T remained a much better known brand. AT&T had nearly killed itself with a series of “strategic initiatives” which backfired more often than not (buying NCR, for example) and was nearly a basket case before Whitacre’s SBC bought it up on the cheap.
    Today the telecom market remains fiercely competitive, but AT&T is slugging it out with the best of them and does so profitably. Characterizing the man who made that happen as some Peter principle type shows that DeLorenzo didn’t really do his homework, but rather used google to selectively find anecdotes and opinions in support of his pre-existing conclusions. Personally I don’t know Whitacre and know very little about him, but in business the bottom line is results … and Whitacre has delivered the bacon there multiple times. On the other hand, what has Mr. DeLorenzo actually accomplished?
    As far as Lutz goes, DeLorenzo has been a fawning fanboy forever. Not once has Peter called Lutz out for the multiple money wasting flops sired by Master Bob.
     

  • avatar
    YotaCarFan

    Is that a picture of the new GM CEO getting chauffeured in a Daewoo?

    There continues to be a massive disconnect between GM’s excellent new products and the ability or, more accurately, the inability of the company’s marketing minions to communicate their strengths in compelling fashion to an entire nation of consumers who are all of a sudden from the “show me” state of Missouri.

    This GM shill’s article sums up much of Government Motors’ attitude and problem: They blame the customer for their woes.  They act like narcissists who never accept responsibility for their own roles in getting into their present predicaments – perpetual “victims”.  If their products were truly “excellent”, they’d sell themselves.  

    Furthermore, generalizing about the attitudes of the “entire nation of consumers” shows a that this writer is not familiar with (or misleading with regard to) the fact that the several hundred million US consumers are not monolithic.  So, the credibility of his philosophical claims about the motives of corporate bosses and minions are suspect.  Finally, what makes him think that consumers are “all of a sudden” from the “show me” state?  GM’s credibility has been going down the drain bit by bit over the past 20 years due to their uncompetitive products.  This guy doesn’t get it.

  • avatar
    Z71_Silvy

    Petey D is a moron.  He should be given a show on MSNBC.

  • avatar
    lw

    @John Horner
    Whitacre is a shrewd business man.  He can do merger and acquisition with the best of them.  He did this within telecom to gain market share.  Every land line, cell phone account and data account was dependable cash flow.  Get the cash flow, cut overhead and increase margins.
    If this strategy worked in the car industry, GM would clearly increase revenue and profits buy buying every brand they could.
    Maybe Whitacre thinks he can get congress to regulate the car industry like the FCC runs telecom.  Some laws that force people in each state to only buy cars from certain brands should do the trick.  Alabama can only buy cars from Hummer and folks from New Jersey can only buy Chevys and such..
    Each household in Jersey can have as many princess phones (err I mean Aveos) as they want!!
    Want a Ford? Move to New York or PA

    • 0 avatar
      John Horner

      ” Every land line, cell phone account and data account was dependable cash flow.”
      Not really. Customer churn is a huge issue in the telecom market and there is nothing dependable at all about that cash flow. Don’t get me wrong, I’m not a raving Whitacre fanboy, but DeLorenzo’s characterization of the guy is completely bogus. Had DeLorenzo questioned how well Whitacre’s success in the highly regulated telecom business would apply to automobiles then there might be something to talk about. But no, Peter just shot his mouth off without really knowing what he was talking about, as usual.
      More from Peter: “The fact that Whitacre was plucked from semi-obscurity after a lukewarm career punctuated by abject mediocrity at AT&T to lead what was once one of America’s greatest corporations out of the wilderness was not only puzzling, but immediately makes the entire “new age” GM board suspect right along with him.”
      That characterization makes Whitacre sound like another mindless ladder climber who somehow got to the top chair of one of America’s big companies without ever really accomplishing anything, and that Whitacre had somehow faded into business obscurity once he got the gold watch. This characterization shows that Peter actually knows next to nothing about Whitacre and had probably never even heard of him before he seemingly dropped out of nowhere into the GM board. But, that makes sense. Peter has demonstrated repeatedly that he is very uninformed about goings on outside the Detroit based auto business, and his reaction is a typical insider’s dismissal of outsiders.
      “Some laws that force people in each state to only buy cars from certain brands should do the trick.”
      Wow, I didn’t realize that residents of some states apparently have no choice in cell phone, internet, video or land line service providers and the equipment to use it all. I must be blinded by living in “socialist” California where we struggle to choose between multiple choices of both service providers and hardware.
       

    • 0 avatar
      Christy Garwood

      @ John Horner, you wrote “Wow, I didn’t realize that residents of some states apparently have no choice in cell phone, internet, video or land line service providers and the equipment to use it all. I must be blinded by living in “socialist” California where we struggle to choose between multiple choices of both service providers and hardware.” 

      I have lived in a far northwestern suburb of Detroit (50 mi. due NW) since 1994. I had only one choice of a land line phone carrier at the time, what ever it was before Verizon.  And no cable choice.  It took 6-9 months before cable TV was installed, and then it was Comcast.

      Today, I can get a land line option via the Comcast cable or use Verizon. And the only choice I have for cable TV is Comcast, still.  I gather that choices in these services is based upon population density. Competing hardware is not installed in low pop density areas. 

    • 0 avatar
      joeaverage

      Christy – there is always satellite TV. We live in a small town with over priced cable TV that is also low quality (fuzzy, snowy picture on some channels). We switched to satellite years ago and never looked back. Cheaper too.
      Only one local phone option, multiple long distance options.

  • avatar
    JSF22

    Peter DeLorenzo is a self-important gasbag, and AutoExtremist has become whiny and repetitive beyond belief, but one important reason to doubt Whitacre is that few companies (except maybe GM) have more disdain for their customers than AT&T.
     
    That said, the old boys’ network at GM had to be blown up and Whitacre seems to be doing it. Hell, the Detroit Free Press is reporting tonight that they’ve not only fired Brent Dewar (idiot); they’ve also fired the new Buick-GMC guy after a week on the job. This all might be the height of recklessness, but Whitacre must figure that the company is so close to going out of business, that this will either jump start something or they’ll go out with guns-a-blazing.

  • avatar
    oboylepr

    The premise for DeLorenzo’s piece is many GM cars are just plain fantastic. All that’s needed is expert marketing, perhaps by himself, a legend in his own mind.

    100% correct GW. There isn’t one fantastic car in the whole bunch! There are a few with fantastic promise that’s all. Just look at the number of mediocre, time expired whips still being made. A good example is the Impala. If ever there was an automotive fossil, it’s the impala. It only sells well because it’s rental/taxi/police fodder and it’s cheap. If discounts and incentives were not available to move this dino, they would not sell at all. It’s not alone, GM have many more mediocre cars for sale and I doubt that they make much money on any of them if at all. GM is screwed alright. Still clueless after all these years.

    • 0 avatar
      Happy_Endings

      I would even take it a step farther.  GM’s cars are by in large, competitive, not excellent.  Competitive cars will likely keep your current customers from going elsewhere, but they won’t bring in many new customers.  GM wasn’t making profits with it’s current customer base before and that will just continue.

      GM’s mentality has been for several years that “just good enough” is good enough.  They’d complain about the perception gap and wonder why few new customers were coming in.  They didn’t realize that there really is very little reason to leave a competitor when GM’s cars are only just as good.  If you want to attract new customers, your product must be better than the competition, not just as good.

  • avatar
    mtymsi

    I am not any more familiar with DeLorenzo than what I have read on this site about him but his claim that Lutz is the greatest product man in 40 years tells me all I need to know.
     
    Next case.

  • avatar
    tparkit

    But Bob isn’t going away by any means, so no premature career send-offs need to be written. He will continue to advise GM on product development and design, and – seeing as I consider him to be the top product guy of the last 40 years in this business – that will be a very good thing for GM, or at least it should be if they continue to listen to him.

    This is preposterous on its face.  Bob has been fired. Now that Whitacre has withdrawn his support, Bob has gone from "Who’s Who" to "Who’s that?" overnight. If he was foolish enough to open his mouth to give advice to managers at any level he would be ignored and humiliated.  He’ll have a very nice office and a secretary until he goes away.

  • avatar
    baldheadeddork

    Christ knows when I want to know what’s wrong with the domestic auto industry the first person I’d look to is someone who created those legendary ads that made the 70’s, 80’s and 90’s a golden era for Detroit.

  • avatar
    Rod Panhard

    Brian E, your post recaps what’s wrong with GM and how it’s been since the long-gone segment known as “Personal Luxury Cars” was hot, Hot, HOT! in the 1970s.
    Or in other words, GM falls all over itself to attempt to compete with everyone else, and in doing so, competes with themselves instead.
    There is no logical reason that both Buick and Cadillac products should compete with Lexus products. It should be either Buick or Cadillac. When both compete, it only presents more opportunities for customers to take their business elsewhere.
    If  Mr. Whitacre can see this, he can save GM. If he cannot, then this saga will continue.

    • 0 avatar
      MrDot

      What’s wrong with GM is that they seem to only care about making niche luxury vehicles while grudgingly half-assing the kind of bread-and-butter volume sellers that keep most other car companies afloat.

  • avatar
    Facebook User

    Comments about Ed Whitacre as incompetent Chairman and now CEO are laughably off-base. I had the experience of working with him, albeit briefly, in person during the 1990’s in then 7 regional Bell company legal and political campaign to gain freedom from the Bell System breakup (‘divestiture’) severe restrictions of 1/1/84. Whitacre was at times the most enigmatic of the 7 Chairmen in many ways, but in hindsight it was his true competitive planning going on. He took poor old Southwestern Bell of St. Louis and made is the AT&T of today. Think about it. Along the way he cherry-picked the best talent of Pacific Telesis, SNET, Ameritech, BellSouth and then AT&T as he snapped them up — and ditched 1000’s and 1000’s of the rest of the executives fast. I saw it happen. You think he 1) can’t do that now, and 2) there aren’t bruised feelings of those who didn’t make the cut out there? Get real. Who said he has no takeover experience in this reply chain? Are you nuts? I think you all need to brush up on history before talking about Whitacre so much with ignorance like this on display.

  • avatar
    cmcmail

    Building good cars is relatively easy, building a reputation is much more difficult, rebuilding a shattered reputation is nearly impossible. They have a long subsidized road ahead, no matter who is at at the helm.

  • avatar
    rnc

    Lets look at this another way, from a political standpoint, a Democratic administration choose someone, who I can guarantee is a hardcore republican, to be the Chairman of a company that it saved, I take that to mean that they believe he was the best person “available” to be in that position, (not necessarily the CEO, they’ve already hired a placement firm to find a perminant one).

    With GM at this point anything they do right, most are going to find some reason that it is wrong, kind of like thier cars, it’s going to take time.

  • avatar
    Pig_Iron

    Is this a case of two wrongs trying to make a right? If or when he fails, will he have to fire himself? Mullaly has a manufacturing back ground, AT&T is largely a service company. I would suggest the two are not the same as far as management and operations. It seems to me, he underestimates the task before him.

  • avatar
    panzerfaust

    DeLorenzo sounds a lot like Fritz Henderson’s daughter. 

  • avatar
    psarhjinian

    In his previous executive life Whitacre was known as an arrogant know-it-all who was never wrong, never listened to reasoned advice
     
    I’m sorry, but if “It takes one to know one” ever applied, it’s here.
     
    and who brought absolutely nothing to the table of his own on a day-in, day-out basis.
     
    You mean like leading one of the weaker baby Bells and turning it into one, if not the, leading national carrier?
     
    And yes, AT&T’s service isn’t great.  No telecom has great service, because the margins associated with “great service” are throat-slitting.
     
    the most crucial issue facing GM is the fact that a highly skeptical American consumer public is finding it hard to be impressed with GM’s excellent new vehicle lineup.
     
    That would be because that excellent vehicle lineup does not stand out in any meaningful way vis a vis Toyota’s excellent vehicle lineup, or Ford’s excellent vehicle lineup, or Honda’s, or Hyundai’s.
     
    And it’s the one crucial issue that has not been addressed by Whitacre’s changes.
     
    Well, yes and no.  Whitacre poleaxed at least two GM “lifers” (La Neve and Henderson) who took absolutely no action on this front.  Further, he pulled Lutz’s marketing responsbilities, since his strategy of bitching about how the customer should come to GM on his/her knees and beg forgiveness for being wrong about their perceptions wasn’t just bad, it was condescending and actually drove people away.  When your VP of Marketing’s statements amount to “You’re an idiot for not buying GM!” you have a problem.
     
    Peter has the same myopia that afflicts anyone in GM’s orbit: that the problem isn’t product, or marketing, but the customer.  This is insane, but it’s an insanity that they all share and thusly they think it’s normal.
     
    Why is that do you suppose? I’ll answer that one for you: 1. He doesn’t have the first clue at to how to go about it, and 2. Even if he did there’s no one currently in the building in the post-Lutzian era who is capable of taking them where they need to go.
     
    There wasn’t anyone in the building pre-Lutz/Wagoner/Henderson/Smith/Zarella/Smith, either.  it’s been the same incestuous people, day-in, day-out, for nearly fifty years.  Don’t kid yourself.
     
    There continues to be a massive disconnect between GM’s excellent new products and the ability or, more accurately, the inability of the company’s marketing minions to communicate their strengths in compelling fashion to an entire nation of consumers who are all of a sudden from the “show me” state of Missouri.
     
    This gets brought up again and again, and yet GM has never, ever learned: look to Hyundai.  The Big H started life in North America as a purveyor of cars that made GM’s worst look pretty good.  For years, they cranked out products that ran the gamut from outright travesties (the Pony and Excel) to grindingly mediocre (the XG350, most Elantras).  What Hyundai did was threefold:
    * Price their products fairly.  None of GM’s “value pricing” where the MSRP starts north of the equivalent Honda, and then slowly slides through the year until it’s well under.  Plus rebates.  Plus financing.  Etc.  Consumers don’t like this shell game, and Hyundai largely solved it by using an “Our cars are good, and a good value” strategy.
    * Make uniformly decent products.  There’s nothing in their lineup that isn’t dramatically improved year over year.  Yes, the have no CTS-V or Corvette, but they don’t have any cars that are sold just to have something to sell, either.

    * Stand behind the product.  Hyundai’s ten-year warranty isn’t important in itself, but important for what it stands for: “We stand behind our product, and we’re willing to prove it to you”.  GM’s message is “You’re wrong, our product is just as good.”
     
    Anyone who thinks The Peter Principle isn’t alive and well in corporate America today is kidding themselves.
     
    Of course it is.  It always has been, despite Peter’s assertion that humanity fell from grace in 1970.  GM has probably the most evident case of this: Peter’s erstwhile automotive Jesus, Bob Lutz, who is actually good at what he does (product planning for the enthusiast market) but patently bad at anything above that.
     
    Here’s a few questions for Peter, which I know he’ll never publish in his reader mail: How could Whitacre possibly be worse than the last five or six guys who preceded him?  How could someone who has experience running and growing a successful business be worse than the five or six guys before him who oversaw GM’s year-over-year fall?
     
    What Whitacre is doing should be obvious: He’s giving the talent that GM might have a chance to succeed by giving them enough time to “win”, but also giving them actual objectives that have to reach in order to “win”.  Gone are the days of year-over-year failure being somehow ok.  I don’t know how this could be construed as a bad thing unless you’re labouring under the delusion that he’s been doing the right thing all along.

    • 0 avatar
      John Horner

      Well said. BTW, there is great irony in a guy named Peter talking about the Peter Principle!

    • 0 avatar
      Christy Garwood

      psarhjinian, you wrote “That would be because that excellent vehicle lineup does not stand out in any meaningful way vis a vis Toyota’s excellent vehicle lineup, or Ford’s excellent vehicle lineup, or Honda’s, or Hyundai’s.” 

      Just a reminder, I am a Cadillac-Buick-GMC-Chevy employee.  Also as a reminder, the Cadillac-Buick-GMC-Chevy line-up in North America does stand-out in a meaningful way – more vehicles sold than any other OEM, even during these last few down- market years.  I can’t wait until TTAC upgrades their sales reporting so we all don’t have to do the math by bopping from post to post to add up the Toyonisdai-Ford-Chryco numbers.

      RE: your take on what Whitacre is doing, IMO from the inside view, you are on the money. And is it ever refreshing to see!
      RE: Hyundai vs a Cadillac-Buick-GMC-Chevy warranty since 2005 – please read the details of both, Cadilla-Buick-GMC-Chevy wins.

    • 0 avatar
      midelectric

      @ Christy Garwood, see “more vehicles sold than any other OEM” is exactly the kind of metric that the customer does not care about.  Well, maybe my dad who bought two Escorts in the 80s since they were the best selling car in the world but now, even he’s wised up and isn’t even considering a domestic this time around.  Long before Camry and Accord led in sales there were legions of happy customers.  Hyundai is intent on joining them by allaying long-term durability fears through a long warranty. 10 years of warranty does a lot for retaining resale value as well, something that GM cars are not very good at.

  • avatar
    stevelovescars

    Another irony in AutoExtremist’s latest diatribe is his ongoing love-fest for Jill Ladjziak, former Saturn head.  After going on about useless marketing hacks who can’t sell good products and who presided over  failing brands for years, he gushes about Jill… who was the boss at Saturn for nearly ten years.  During this time (and, to be fair, for a few years before she took over) the brand was getting pushed aside by GM and was simply floating along on nothing more than inertia. 

    Saturn finally got some products that looked decent and earned some positive press, but they still didn’t sell.  The brand under Ladjziak’s leadership had failed to maintain any resonance with consumers. 

    Good for her for landing a job in Detroit (while hundreds of her former employees get in line for unemployment benefits) running Smart, but I wasn’t optimistic about that product’s longevity in this market and now I’m even more pessimistic.

  • avatar
    mjz

    To be fair, I think Jill did a pretty good job with what she had to work with there at Saturn (which wasn’t much). The big problem IMO, was that GM never provided Saturn with any marketing $$$’s to do the kind of launches that were necessary once GM finally gave them some terrific products. The Aura was a great product that could have kicked some Camry/Accord butt, but whose launch was pathetically underfunded. It just never took off like it should have. Astra wasn’t just underfunded, I don’t think they even advertised it (well, OK just a little), but it never got on the radar screen of potential buyers. Sad.

    • 0 avatar
      stevelovescars

      The big problem IMO, was that GM never provided Saturn with any marketing $$$’s to do the kind of launches that were necessary once GM finally gave them some terrific products.

      I have no doubt that GM was mostly led by folks who had come from other divisions and who mostly looked at Saturn as a red-headed stepchild.  However, it would seem to me that the job of a division General Manager is to build the case for providing the brand with the necessary resources to get the job done.  One can’t simply blame “GM” for not giving Saturn enough money… Jill’s job was to get those resources. 

      And, before the Aura, the brand’s products were extremely weak… the Ion was an embarassment and I don’t think many people even remember their sad excuse for a minivan… I can’t even remember what they called it. 

    • 0 avatar
      Christy Garwood

      @ stevelovescars – memory jog for that forgotten Saturn mini van – what kind of race is run where a baton is passed from one runner to the next for a different leg of a race?…  Reeeeee……..    LAY!!!!!!!

    • 0 avatar
      joeaverage

      How was the Relay any worse than the other GM versions of the same van? Our friends have one and rave about it. To me it is exactly like the two Chevrolet versions in our extended family. I drove a Chevy version on a 10 hour trip up north and after renting a Sienna a few week before and we (myself and 9 college students in two of these vans) said “MEH!”

  • avatar
    Mikein08

    What’s this?  Lying, incompetent, self-serving, egotistical megalomaniacs at the top of
    the corporate food chain?  And at GM? Why, I’m shocked and horrified!

    The top three levels of management at GM need to go away, before the whole company
    goes away.

  • avatar
    Sinistermisterman

    I’m a bit confused. GM seem to be selling quite a lot of Impala’s, Sierra’s/Silverado’s & Camaro’s in their segments compared to pretty much everyone else according to the info posted on here over the past few days which means that the perception of GM products can’t be that bad?

    • 0 avatar
      educatordan

      It depends on how you view that, Sinistermisterman.  Some see it with the Impala as a vehicle that’s pretty decent reliability-wise but has a ways to go in fit and finish, a product that happens to be large (inside) and cheap to buy, and mostly bought by geezers.  (Remember I said that’s OTHERS opinions, not mine).  With the Silverado, it wins most comparisons I’ve seen in magazine’s in the last few years, but the personal truck market is tanking right now.  The Camaro has had teething problems and many of the B&B (myself included) think that once the nostalgia is worn off, the Camaro’s sales will start tanking. 

      Three vehicles does not a company make.  Personally I love the Impala, think the Camaro is too BLOATED and impossible to see out of, and I own an F150 cause I only buy used and got a good deal. 

      Back to GM.  I’m willing to give them a chance but they really do need a better warranty because, damn it, Lutz, if the product is sooooooooooo freaking fabulous, then start to stand behind it!  And as far as the current “blood-bath” in the executive ranks goes, let’s see where this company stands in a year and how much more of our money they’ve taken.

  • avatar
    mjz

    stevelovescars:

    Penske’s no fool, he wouldn’t have hired her if she wasn’t good. And you shouldn’t blame the Relay on her. I’m sure she was told Saturn would have to market that piece of crap. Even Buick got stuck with that awful Terraza abomination. She should get credit for at least getting the funding for new products for that product starved division. "If we build it, they will come" seems to have been GM’s motto, sadly for Saturn.

  • avatar
    Christy Garwood

    Granted, telling a customer that we sell the most vehicles is not a good way to sell an individual a car.  But why do so many people buy Cadillac-Buick-GMC-Chevy?  Remember the original comment about it not being an excellent line-up?  If it is such an atrocious line-up, why are people buying those cars and trucks?

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