Business Magazine Suggests GM Should Close 5 Of Its 8 U.S. Brands

[AMERICA 123]

Originally Posted by Geotpf

Toyota has a 45.6% market share in Japan.

Source:

http://www.toyota.co.jp/en/news/08/0423.html

Good. Lets use that.

45.6% of what size market ie equals how many units ??

Now, how many brands, 'subbrands' and channels of distribution does Toyota use in the JDM - for that volume ?

What is the specific thru put for each channel. ie sales volume/channel ?

In terms of indirect and direct sales costs , what is Toyota spending per unit sold to maintain those channels and subbrands. ?

Approximately how much more per unit sold does a channel of distribution cost there compared to here ?

The average Toyota automotive product sales person sells 2.0 - 2.33 new units per month.
Also on average, they enjoy a higher relative economic status than their American counterparts .
Finally, Toyota invests large sums of money in their training and keeping them current.

Given all that, how are salespersons compensated in Japan and how does that add to Toyotas cost per channel compared to here in the USA.?


What is Toyotas average gross per unit. thru their system there. ?

How do these numbers taken together with Toyotas situation at home compare to GMs here in the US ie why and how are they the same or different. ?


Be happy to go forward here and I'll wait for you to get up to speed or .......

I can save you some time - the false and incomplete argument used in this article if applied to Toyota would require them to dissolve 40 -50% of their channel distribution system asap in Japan.

Lexus in Japan would need to be folded into another channel immediately - It appears more than likely that Lexus 'failure' in Japan is costing Toyota more money than Saturn and Saab 'failure' here combined.

Obviously nobody is saying that too loudly or too often - given all the profit they're making off foreign markets and the Yen manipulation.

[SierraGS]

Originally Posted by Sporer65

I don't see why when brand-killing comes up, no one ever says GMC. If you think about it, GMC doesn't really need to exist. The only GMC that does not have a Chevy counter-part is the Acadia and pretty soon the Tranverse is coming. Even after the Torrent comes over as I'm guessing the Terrain, it will still have a Chevy counterpart. To me, it seems pretty simple: If GM has to drop at least one brand today, it should be GMC. Give the Torrent to Buick instead and then come up with a Denali version of the Chevy SUVs and trucks. Assuming that if GMC was dropped and everyone who would of bought a Sierra now buys a Silverado, then all of a sudden the F-150 wouldn't be the best selling pickup anymore which would be a major selling point for Chevy. The only problem I see with dropping GMC would be that the Buick and Pontiac dealers would have less traffic.

The other brand I see dropping would be Saturn. They started as no haggle pricing and plastic body parts. Well, the rest of GM is getting close to the no haggle part and the plastic is gone. The only vehicle that wouldn't make a smooth transition would be the Astra as there is already a Cobalt. But just make the next version of both the same thing.

GMC sold 208K Sierras in 2007 down from 210K in 2006, Silverado sales were 618K in 2007 down from 636K in 2006 a 18K drop opposed to the 2K drop in Sierra sales and adjusted for sales it would be 6K (2K x 3) and is doing well in 2008 with 57K sales YTD vs 64K in 2007 YTD and again maintains less than half the drop (volume adjusted) in sales against Silverado 2008 sales of 160K vs 202K in 2007 YTD.

The Sierra has a very strong and loyal following and Sierra buyers purchase Sierras because they are NOT Chevy trucks - nothing wrong with Chevy trucks but they are more common on the roads so why not get the same great truck with different styling?

GMC trucks allow Buick/Pontiac dealers to offer trucks and do fleet sales to companies and contractors boosting profits, and the profits generated by GMC more than pay for the different styling and marketing and helps to retain the really good Buick/Pontiac dealers so don't look for GM to drop GMC anytime soon.

[SierraGS]

Originally Posted by vcs2600

That makes sense, and I have no complaints with how GM has designed/marketed any of those vehicles.

The issue is that the requirements of these brands means that GM has to keep around old/obsolete/uncompetitive 'volume' products until they can finally afford to replace them. And therefore there's no G6 MCE, no 'real' G5, no Lucerne replacement in sight, no midsized CUV, etc.

You can say that it will be all better in 2012 or whenever, but by then the G8, Acadia, and Enclave will be overdue for a MCE. Whether they will actually get refreshed on schedule depends on GM's mood and cash balance.

Point being GM's current brand structure ensures that they will always be treading water, 4-5 years behind where they should be. I don't see that changing with out a huge overhaul.

Not sure why GM needs to "keep" obsolete products within a brand - either drop it or go all fleet with it until you drop it.

This is why GM needs to put Pontiac and Saturn together - they can instantly drop the G5 and G6, and introduce RWD replacements in Alpha based Firebird (G5) and Grand Prix (G6) models. The G8 will remain fresh for at least 4 years with the GXP next year (2009) and if GM has any sense the Wagon the year after (2010) with the fourth year (2011) building up sales momentum for the replacement (2012) in the industry standard of every 4 years.

Saturn introduces the Corsa and new Astra and Aura to round out the car side of things with a GAMMA based pickup on the truck side.

Buick will be fine with the Invicta (replaces LaCrosse AND Lucurne) and the Electra (LWB ZETA) for cars to begin the transition with a Sigma based Gran Sport below the Electra for RWD and a FWD DeltaII based Skylark under the Invicta if sales volumes allow.

SAAB has the 9-1, 9-3 and 9-5 on the car side (all offering Xwd) and 9-4 for truck/SUV.

Fill in the Chevy and Cadillac lines and you have a complete line with the only real multiple duplications in the Delta/Epsilon models but from what the rumors are there will be plenty of room for individualization with body styles (2D, Soft Top Convert, Hard Top Conv, 3D, 4D, 5D, Wagon, Tall Wagon?), FWD/AWD variations and at least two wheelbases. I do not have a problem with offering 2 models from the same platform and in fact think you can make 3 versions (Volume, Luxury and Performance) easily lowering overall costs with volume of sales and maximizing profits with Luxury/Performance versions higher margins.

Truck will be fine with GMC picking up the Terrain, Denali XT and Meriva based SUV and Buicks Enclave.

Pontiac has the G8 ST.

HUMMER goes for a smaller size vehicles aligned to compete with Jeep for volume sales with two models under the H-3.

Again add these new models to the Chevy/Cadillac lines and the existing GMC/Buick/Saturn/HUMMER models and you have another diverse lineup.

The key to this is to keep the number of models to a minimum even if it means not making a model that many want.

This will draw critics but it is the only way to make the most buyers happy without just making 4+ versions of everything - and we know that rarely works out.

[fm442scr]

This guy is INSANE! Kill SAAB?!? Saab is a viable international brand. They might not be selling 3 million cars a year here, but part of Saab's appeal is that it is a semi-niche vehicle that not everyone has. As far as the other brands, Pontiac and Hummer could go, but the other brands, I think, can be or already are being rejuvenated successfully.

[CJ Thunder]

Originally Posted by vcs2600

Simple question: When is the last time GM North America turned a profit?

I think it was 1992, 16 years ago, but I'd appreciate if someone chimed in, thanks.

Thats a problem how they ran there business. Not anticipating trends and demographic changes.




How about the fact that car sales are down because cars are better?

[Buickman]

Originally Posted by CJ Thunder

Thats a problem how they ran there business. Not anticipating trends and demographic changes.




How about the fact that car sales are down because cars are better?

when is the last time a GM executive was fired for failure? trick question...answer is never (at least in modern times). Lovejoy heads GMAC when McNamara burns us for $400 million, he gets transfered to SPO. the Fiat fiasco cost us billions and no one is held accountable. marketshare nosedives, shareholder value disappears, long term debt skyrockets, Olds is lost, GMAC is sold, Buick is starving to death, plants closed, assets sold, divisions spun ...and once again...zero accountability. this is the single biggest trouble at GM. in particular, the marketing staff is comprised of incompetent failures who are never called to task for their inabilities.

again I state "Return to Greatness" is the answer. 5 Points of share within 6 months or my name isn't Buickman.

[vcs2600]

Originally Posted by SierraGS

Not sure why GM needs to "keep" obsolete products within a brand - either drop it or go all fleet with it until you drop it.

Plant overcapacity. Dealer commitments. Basically GM is still trying run itself as if it had the resources to support these brands when they clearly don't.

The Pontiac G6 is sort of emblematic of this thinking. Even with the BGP consolidation, they still "need" this model. And it's "almost there" -- it mainly needs a new dashboard and HFV6 engines, maybe with a turbo-4 for 'excitement'

But instead of a standard 3 year MCE cycle ... GM does nothing with the car except add a bodykit, and it now it's starting to lot-rot. The beancounters need a place to dump HV engines and 4 speeds. The dealers demand the car. They can't kill it, but nor can they keep it updated. Just wait 4 more years until the replacement comes... everything will be ok .... someday ...

They need to slash and burn until the numbers support industry-standard 3/6 year update cycles. The real numbers, not bogus predictions.

[HotCarNut]

Originally Posted by KingElvis

EXACTLY!!!!!!!!!!!!!!

Jeezuz, why do we need Saturn? Saturn has SUPER LOW VOLUME compared to other divisions. They're not very profitable, and Saturn has no 'brand' image anymore since they make a big SUV and mid size car.

Congratulations and welcome back the old school thinking that flushed GM down the toilet! (Hope fully the sarcasm is duly noted) I don't give a rat's @ss about volume. If the company isn't profitable, then it doesn't matter whether they produce 1 or 1,000,000 vehicles. They won't be around very long. Face the facts: volume is a losing strategy and has been for the last 35 years. It is the absolutely wrong measuring stick. GM should be looking at profitability and growth, not volume. Volume doesn't create cash flow, pay the bills, or create brand excitement. Profitability and cash flow go hand in hand, lead to better products (because there is actually money to spend on R&D), and contributes to a growing, healthy, stable business.

[SierraGS]

Originally Posted by vcs2600

Plant overcapacity. Dealer commitments. Basically GM is still trying run itself as if it had the resources to support these brands when they clearly don't.

The Pontiac G6 is sort of emblematic of this thinking. Even with the BGP consolidation, they still "need" this model. And it's "almost there" -- it mainly needs a new dashboard and HFV6 engines, maybe with a turbo-4 for 'excitement'

But instead of a standard 3 year MCE cycle ... GM does nothing with the car except add a bodykit, and it now it's starting to lot-rot. The beancounters need a place to dump HV engines and 4 speeds. The dealers demand the car. They can't kill it, but nor can they keep it updated. Just wait 4 more years until the replacement comes... everything will be ok .... someday ...

They need to slash and burn until the numbers support industry-standard 3/6 year update cycles. The real numbers, not bogus predictions.

That is why I mentioned having out of date models going "fleet" for the last year or two of production.

Agree the G6 needs a new dash/interior with a 6-way power seat available without having to order leather.

The G6 has offered the HF 3.6L w/6-speed since 2007 so that is not an issue.

Again move Pontiac with Saturn (or replace Saturn with Pontiac) and the need for a FWD G6 disappears, with the money saved going towards a RWD G6 replacement.

[MrJamesMc]

I don't think people should suggest to GM what they should do in such detail by making lists out of the brands and what "image" they should shoot for. If you have the professional title and right to do so, please go right ahead, but if not then GM won't listen to you. Much like a man giving medical advice to someone, a man who is not a doctor nor has had any medical education. A car company can't switch a whole brand or kill it over night, things take time.

[mbukukanyau]

Who of you has ever run a car company? None.

[2b2]

^ & ^^ I'll quit when people give up their fanstasy-sport-teams games
(no I won't )

Originally Posted by SierraGS

...Again move Pontiac with Saturn (or replace Saturn with Pontiac) and the need for a FWD G6 disappears, with the money saved going towards a RWD G6 replacement.

with the downsizing that CAFE could lead to
maybe pair Saturn with Buick with the dividing line slipping below the Aura
Saturn bringing as much upscale swank as will work to little vehicles
and Pontiac could be the Rwd-frosting on their 2-layer-cake?

[EatonISgay]

There should only be one brand! Cadihevropontiuckurnmmeraabmc. : )



Bottomline is you could make a case either way. As soon as GM dumped 3 brands the chinese would come in with 5 of their own.

GM lost market share because it didn't build what we wanted, thats why you saw hyundai, kia, scion, lexus, infiniti, mini, etc. come in. All new brands.

Who cares if there owned by different companies or sold under one umbrella - GM? GM, build stuff we want and nobody would be having this conversation. Build it before someone else does.

[SierraGS]

Originally Posted by MrJamesMc

I don't think people should suggest to GM what they should do in such detail by making lists out of the brands and what "image" they should shoot for. If you have the professional title and right to do so, please go right ahead, but if not then GM won't listen to you. Much like a man giving medical advice to someone, a man who is not a doctor nor has had any medical education. A car company can't switch a whole brand or kill it over night, things take time.

How do you know that some of us do not run multi-national companies with billions in sales with double digit growth rates in revenue and net income and are more than qualified to run GM?

There have been some very well thought out plans posted on this topic from GMI members for GM to consider and if you read them that is all they intend to do - present a solution, obviously we do not have all of the facts that GM mangament has and as with any proposal some give and take are required when weighed against budget and time realities, then get through the corporate politics that exists in any large company.

[yoblues]

It's all irrelivant talk. In the end the consummer will decide weather GM has eight brands or NONE at all.................