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Re: Business Magazine Suggests GM Should Close 5 Of Its 8 U.S. Brands
I'm not sure that the brands need to be killed off, just better differentiated which GM has started to do.
Buick in China is so popular because they have amazingly good looking and high quality vehicles that we don't see here in America. The Enclave has sold well and the new design unveiled in China for global production should provide a good litmus test for the brand's power here in the US. It is definitely better styled and has a nicer interior than anything here currently.
Saturn doesn't really cost anything anymore for development as they are simply re-badged Opels. Saturn's problem is the dramatic shift over the last 2 years in pricepoint that has alienated it's old customer base. Good advertising to create brand awareness could solve that problem and bring import buyers back to an American nameplate.
Saab needs to go away. Let it be a European brand only as it isn't large enough to sustain the investment needed to meet regulations in both Europe and the US. Sell it to Sir Carlos or whoever was interested in buying Volvo.
Hummer is a niche brand that makes a substantial profit for GM. Why sell it when it's development costs are shared with Chevy and GMC (the platforms underlying the H2 & H3)? Plus it reaches a market segment that no other GM vehicle hits. All Hummer dealerships are tied into another (normally a Cadillac), so it's not like selling the brand will help decrease your glut of dealerships either.
Pontiac. This is a brand in flux. The strategy was to move Pontiac to RWD performance at an everyman's price. However, unless GM significantly changes it's engine strategy and offers diesels, emissions regs and CAFE will kill this lineup. The only real hope is to lower the volume such that Pontiac has 3 or 4 great models selling a total of 150k vehicles a year max. Again, it's hard to argue that killing it saves any money since it is now linked closely to Holden and therefore development costs won't really go away. Most of the dealers also have Buick and GMC, so killing Pontiac by itself won't help the dealership glut.
Honestly (and I realize this is going to piss a lot of people off) the best strategy would be to kill Chevrolet as it has the most independent dealers and nearly every model has a counterpart in another brand. Yes, I realize that it's the historical pillar of GM. Yes, I realize that the brand recognition is the highest. However, it also offers the best opportunity to close a large number of dealerships without having to kill 3 separate brands. Is it easier to kill one vs three? I don't know, but Chevy's lineup is a truck & SUV heavy hodgepodge, and with the exception of the Corvette, there isn't a unique model in the current lineup. Even the upcoming Camaro would fit well in Pontiac's lineup as a Firebird. If you use brand identity as the criteria, what is Chevy? It has a mix of models, from FWD to RWD to AWD, one mild hybrid that's a clone of a Saturn, a small car that is duplicated at Pontiac (although it really doesn't belong in Pontiac's lineup) and is inferior to the new Saturn Astra, a poor selling large car in the Impala that is nothing like the ones from the 60s or 96-98 that were so popular, etc. etc. etc. In short, Chevy has no defining DNA. It is a garbage dump of the DNA from all of the other brands, and yet it gets the most marketing support and has the biggest dealer network. By taking the pain and abolishing Chevy, GM could free up the marketing dollars for all of the other brands and kill off the majority of its dealers instantly right-sizing the company for the forseeable future.
Now, everyone, please feel free to tar and feather me for being the first to say publicly that the sacred cow is really a lead weight sinking GM's ship.
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