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

[skylark68]

Originally Posted by HotCarNut

I'm going to ask why? I don't mind good disagreement (as I fully expected when I made the post), but I really hate stupid replies that don't make a counter argument.

Last time I checked, Chevrolet offered more incentives at a higher percentage of the purchase price than any other brand. Last time I checked, Chevrolet had the worst resale value (as a percentage) of any GM brand except Saturn's prior lineup, none of which exist anymore. Neither of those items adds up to profitability or brand image. Last time I checked, those 1,000,000 customers could buy a nearly identical GM product from one of the other GM brands besides Chevrolet (with the exception of the Corvette). Last time I checked, GM had more standalone dealerships than any other brand by a HUGE margin.

If GM's goal (as they've stated) is to reduce the number of dealers by 30-50%, to discontinue "badge engineering", and to increase profitability then it makes more sense to eliminate Chevrolet than any of the other brands. Get over the emotional attachment to a brand that sold it's soul better than 30 years ago and take an honest look at what Chevy is today. Outside of the Corvette, there is not a single unique segment leader in the lineup. The Silverado is a duplicate of the GMC Sierra and the Malibu is a twin for the Aura, with the next generation Aura getting some outstanding styling to truly match the Malibu.

It makes a lot of sense to me. Why not do what the SEC wanted to do 30 years ago and spin Chevrolet off as a separate company.

Buick was the No. 1 seller for GM for years back in the early days of the auto (1900's - 1920's) and is doing so in China right now. A Buick produced and sold at the same level as the Chinese equivalent could carry a revised BOP/Cadillac General Motors.

Chevrolet would then no longer be saddled with sharing advertising dollars and engineering dollars with the other divisions.

[FenwickHockey65]

Uhh...yeah, I don't think we can kill Pontiac just yet...
I'm starting to get really tired of these stupid journalists trying to figure out what's best for GM. It always involves axing brands, and it never makes any sense. Just leave the brands as they are, change/improve vehicle lineups, specify the target consumers each brand is marketed towards, and advertise accordingly.

[Ambalanche]

Originally Posted by HotCarNut

I'm going to ask why? I don't mind good disagreement (as I fully expected when I made the post), but I really hate stupid replies that don't make a counter argument.

Last time I checked, Chevrolet offered more incentives at a higher percentage of the purchase price than any other brand. Last time I checked, Chevrolet had the worst resale value (as a percentage) of any GM brand except Saturn's prior lineup, none of which exist anymore. Neither of those items adds up to profitability or brand image. Last time I checked, those 1,000,000 customers could buy a nearly identical GM product from one of the other GM brands besides Chevrolet (with the exception of the Corvette). Last time I checked, GM had more standalone dealerships than any other brand by a HUGE margin.

If GM's goal (as they've stated) is to reduce the number of dealers by 30-50%, to discontinue "badge engineering", and to increase profitability then it makes more sense to eliminate Chevrolet than any of the other brands. Get over the emotional attachment to a brand that sold it's soul better than 30 years ago and take an honest look at what Chevy is today. Outside of the Corvette, there is not a single unique segment leader in the lineup. The Silverado is a duplicate of the GMC Sierra and the Malibu is a twin for the Aura, with the next generation Aura getting some outstanding styling to truly match the Malibu.

I guess I understand your premis but I couldn't disagree with you more. Chevrolet is the volume brand, always was, always will be. The models that share a platform with Chevy more often than not wouldn't exist without Chevy selling the "cheaper" version in volume. If anything was to be eliminated it would be the other brands and keep Chevrolet because they already sell the volume. Saturn people might think Chevrolet, but Chevrolet people likely won't be thinking Saturn. Just my .02

[Firebird00]

If worse came to worse, I think GM should only sell Chevy, Pontiac and Cadillac with each brand being a step up from the previous one respectively. You can fold GMC into Chevy seemlessly, Saturn into Chevy and to a lesser extent maybe Pontiac, fold Buick into Cadillac and Pontiac to a lesser extent, sell Saab to anyone with a $1 and combine Hummer into Cadillac. This would give GM the entry level, mid level sport/performance/pseudo luxury, and luxury. You can over extend luxury (Cadillac) into performance (Pontiac) and extend entry (Chevy) into performance (Pontiac). Pontiac would essentially bridge the gap between Chevy and Caddy.

This would give GM a chance to field all of its major players (Corvette, Silverado, Camaro, Suburban/Tahoe, Malibu, Impala, GTO, Firebird, G8, Solstice, Escalade, CTS, the coming CTS coupe, and possibly XLR) with none of the drag (G6, G5, Aura etc). All Buick really brings to the table is the Enclave (doable as a Caddy). All Saturn really brings is the Sky (doable as a BETTER Solstice lol). Saab is crap. Hummer is just an extreme specialty. GMC is a grilled up Silverado as are the suv's which can be done as Caddys without really changing much.

However, I am not in support of shutting any brands. Make them work

[espo19047]

Originally Posted by HotCarNut

I'm going to ask why? I don't mind good disagreement (as I fully expected when I made the post), but I really hate stupid replies that don't make a counter argument.

Last time I checked, Chevrolet offered more incentives at a higher percentage of the purchase price than any other brand. Last time I checked, Chevrolet had the worst resale value (as a percentage) of any GM brand except Saturn's prior lineup, none of which exist anymore. Neither of those items adds up to profitability or brand image. Last time I checked, those 1,000,000 customers could buy a nearly identical GM product from one of the other GM brands besides Chevrolet (with the exception of the Corvette). Last time I checked, GM had more standalone dealerships than any other brand by a HUGE margin.

If GM's goal (as they've stated) is to reduce the number of dealers by 30-50%, to discontinue "badge engineering", and to increase profitability then it makes more sense to eliminate Chevrolet than any of the other brands. Get over the emotional attachment to a brand that sold it's soul better than 30 years ago and take an honest look at what Chevy is today. Outside of the Corvette, there is not a single unique segment leader in the lineup. The Silverado is a duplicate of the GMC Sierra and the Malibu is a twin for the Aura, with the next generation Aura getting some outstanding styling to truly match the Malibu.

I would have to do a study of brand loyalty and recognition to say for sure but I bet Chevy is the leader in both catagories. The one thing Chevy has that the imports can't buy is a heritage and history.

[tgagneguam]

Originally Posted by LAMRONH

Yes, yes, but their careers would suffer if we fired them!

I've seen the same goings-on in the military and civilian sectors, where incompetent higher-ups retain incompetent middle managers because holding them accountable for their incompetence might hamper their careers.

Stupid is as stupid does.


Attributing corporate success or failure belongs squarely on the shoulders of management. Not brands, not inanimate objects, but management or lack of same.

Yup.

Notice all the permutations people are coming up with for a successful GM. The funny thing is is that all the models could work if(!) GM had strong leadership. Notice also that few people are commenting on the root of the problem of GM's multi-brand strategy: poor management. This discussion in ways sounds very familiar I imagine to the blamestorming sessions that occur at the RenCen. And notice, too, that GM continues to be mired in mediocrity, again, because the fundamental issue is still not being addressed.

[pinyon]

Chevy

P/B/G

C/S/H

Keep the combo dealer brands carefully focused. We just haven't seen if GM will do it properly for PBG without overlap so it's a wait and see. CSH should be easier except we already have a BRX and 9-4x together. The only one it think needs changing is Saturn even though i've owned several. Make it GM's Scion and get back to making a line of basic value transportation again, and not just a rebadged Cobalt. (I know, the ION came first). Unless the dollar recovers or they're make here, rebadging Opels won't cut it.

[FenixII]

What if,,,,, just what if Gm kills Saturn and shares the Opels with Saab??
Then we can have a 2 seats saab (SKY), a small saab(ASTRA), a mid size saab(AURA9-5) and the crossover (outlook 9-7, vue 9-5). We´ll have the european flavor in just one brand. Sharing costs with opel and the good service with saturn.

[BrickTamland]

If you’re shopping for a midpriced sedan, for example, G.M. has six. Buick by itself has two. Toyota, by comparison, has just one—the Camry, which sells nearly as many vehicles each year as all six of G.M.’s offerings combined.

So if they are including the midsize LaCrosse and fullsize Lucerne, why not include the Avalon with the Camry? It even costs less than a Lucerne.

Originally Posted by Ambalanche

Those of you who are still lamenting Oldsmobile's demise and say Saturn should also die, do you realize that GM has essentially turned Saturn into Oldsmobile?

I do not really believe this is the case. When looking at the "Europeanized" 1990s and 2000s Oldsmobiles, what do Saturn and Olds have in common other than a midsize sedan with sporty pretensions (Aura and Intrigue)? Olds got out of the compact business before its "renaissance." Saturn never made a fullsize, upscale, and/or sporty car like the Eighty Eight, Ninety Eight, or Aurora. They both made minivans, but they were hardly "flavored" for the different brands. The Silhouette was at least visibly upscale from the other vans, unlike the Relay which did not look at all upscale from the Uplander. You could say Saturn is taking the place of Olds as the middle prices brand, but in terms of product similarity that I often hear about, I do not believe such is reality.

[jbernie]

FYI for those saying Saab should go, please remember that Saab is pretty much the only true global brand GM has and the fact that it is only a few thousand sales per year away from being profitable (yes, i know, finally!!!) is good reason to keep it around. For the amount of sales required across all countries it sells in you are probably looking at needing maybe a few hundred sales in each country.

I am very happy with my Saab, make a few adjustments in content, get the fuel efficent diesels here in the USA and advertise the brand properly and all is good. The 9-4x should also help improve things.

Saab certainly can be a "green" brand for GM with e-85 engines, diesels, small capacity good power turbo 4s and the HFV6 turbo in the 9-3 Aero.

[benroethig]

I have to agree to a point. There should be three brands: Chevy, Cadillac, and Pontiac. Chevy will take the general passenger car and fleet tasks, Cadilliac will expand their lineup, and Pontiac will be there for affordable performance. Chevy will add 3 and 5 door hatches to Cobalt replacement lineup (for the 3 to 5,000 that want them) and a WM based Caprice to replace Buick as well as for Police and Taxi fleets as well as a new Blazer to go up against the Wrangler (and to a point replace Hummer).

[MrJamesMc]

I think a lot of people are screaming, "Sell Saab and Hummer!" at GM.

I agree. Sell those! Saab hasn't had a unique and fresh product out since the introduction of the second generation 9-3. They have freshened things here and there, but nothing NEW. The 9-7x is an obvious rebadged Chevrolet Trail Blazer/GMC Envoy/Oldsmobile Bravada/Buick Rainier. In fact, it's humorous looking at the "Saab Touches" on that SUV. The radio, navigation, and A/C controls are obviously standardized GM parts along with the vents in the back seat that they missed when they Saabized it. The 9-5 kind of clashes with the Cadillac CTS for they are both midsized premium sedans, only I prefer the CTS and through sale figures, I would say most prefer the CTS. The 9-3 isn't exactly selling perfectly, their sells haven't reached what most would hope it would after the refresh. GM doesn't seem to have the money to make Saab a world-class brand and I understand that. Cadillac is more deserving of the funds to make it world class since they have an attractive past of luxury that is of higher rank than Saab.

Hummer has had such a bad image with economically friendly people that is spreading to even common-every-day type people. With fuel prices rising, people have a lack of interest suddenly in large SUVs. Plenty of people went out in the earlier millinium and grabbed an H2 with a five year note, barely being able to make payments on it. Now that gas is high, they can barely make payments and afford gas, so they'll look onto something else. The brand itself seems a bit of a gimmick and with a growing disapproval of the war, the Hummer name might also strike up other controversial ideas too that people may not condone. An image of war.

[EldoFan]

Originally Posted by t-rex

There's no reason why all of GM's brands, even the now-defunct Oldsmobile, couldn't survive, or even thrive, as full-line brands. GM damaged its brands, not the market.

Buick: soft, refined luxury. Priced between Chevy and Cadillac.
Cadillac: expensive luxury cars
Chevrolet: mainstream family cars and retro-themed models
GMC: upscale SUV's. Remake GMC along the lines of Land Rover/Range Rover.
Hummer: move to mainstream, competing with Jeep. Sell in Chevy showrooms.
Oldsmobile: midsize and up Opels, with new flagship models to be shared with Opel
Pontiac: the smaller Opels, and RWD products shared with Holden
Saab: Highly individualistic, aircraft-inspired cars, with no pretention of being "upscale"
Saturn: Inexpensive Daewoo-sourced subcompacts and compacts plus Opel's MPVs.

It'd take some fanagling to get the dealer channels right...

But if rationalisation is the answer, sell off Hummer and Saab (sadly, I don't think anybody would want either), kill GMC (I refuse to believe the vast majority of GMC buyers wouldn't migrate to Chevy), reshape Buick, and kill either Saturn or Pontiac, with the survivor of the two selling Opels and Holdens (I'm thinking Pontiac could do a better job of doing this).

Have three sales channels: mainstream Chevrolet, upscale/import Buick-Pontiac, and luxury Cadillac.

Amen to that!

And to all the beancounters everywhere else (like the author of this 'article'........STFU! I guarantee you have no real clue what the **** you're talking about.....

[chakis24]

Originally Posted by zete

The number of brands isn't the issue, instead it's the fact each was a full line brand.

What we're seeing now is a niche strategy for specific brands -- Buick, Pontiac, Saturn -- while Chevrolet becomes the full-line brand.

With a niche strategy it will work fine. GM has the reach since they can spread the costs of a specific model around the world. The old GM would have each area have their own cars, but that's slowly disappearing. Pontiacs will be rebadged Holdens, which means Holden has an avenue in North America for their cars. Saturn are rebadged Opels, again, Opel gets an avenue in North America. Buick ends up being a total niche luxury player, focusing on comfort and unpretentious luxury and the Chinese market while Cadillac can go after everyone globally along with Chevrolet.

Killing Pontiac will hurt Holden. Killing Saturn hurts Opel. Killing Buick hurts Buick. And Buick is massive in China.

The article is written by someone who is so fixated on the North American part of GM they don't see the global picture. If the author had dug a bit deeper he'd have realized that what GM has been doing isn't simply consolidating dealerships but consolidating platforms. No longer are we going to see design and manufacturing replicate a small car for every market, instead they're looking at global platforms and global vehicles.

That's what Toyota does. And Toyota has started into niches with Scion.

Niches are the future. They won't sell like the main line, but they will keep people in the family when they no longer want the Chevrolet but want something more exotic. The niche brands will provide that, selling 200,000 - 300,000 vehicles a year tops. And as niche vehicles, GM can keep the supply limited and the profits high while Chevrolet can focus on those looking for a deal. Cadillac, once it regains its old luster, will simply charge a premium for being Cadillac.

And if you want to look at where the niche strategy currently works at GM look no further than Hummer. If that's not a niche vehicle, nothing is.

Originally Posted by Astra RL

Killing brands fails. We all saw what happened with Oldsmobile those buyers that were supposed to go to other brands in GM, went elsewhere. So, if GM were to kill Buick, Saturn, GMC, Saab, and Hummer, where would these customers go to. Certainly some would go to chevy/Caddy but very few. Some people will not consider a Chevy, but will gladly purchase a Saturn Aura.

you two are spot on. people who buy gmc arent necessarily going to buy chevy, and im pretty sure some will feel burned by gm for it. and the sierra is the number 5 best selling vehicle in the country i think. gmc has a luxury cache that chevy doesnt have.

pontiac, hummer, saab- work with me here. this is your enthusiast channel. offroading, racing, or alternative fuels. pontiacs are no frills street performance (but you can get the anemnities if you want it), hummer is all about offroading, entry level all the way up to land rover. saab is sporty, but a bit more luxurious, theyre also where diesels are introduced. (i also cant really think of a place for saab unless its stand alone. just pontiac and hummer would work too).

buick, caddy, gmc- your luxury channel. gmc is already "professional grade" chevys, especially with the denali line. buick is floaty, american luxury. its all about style and comfort. caddy is your performance oriented luxury vehicle.

saturn and chevy- stand alones. saturn cause its saturn and chevy cause it has everything anyway.

just a little twist on things. the saab thing is a little bit of a stretch, but i can see a diesel saab before anything else, it just seems to make sense with the car.

[Beau]

No... NO no no..
You know what GM needs to do? Keep listening to GMIers.

GMIer: Freaking GM! WHEN WILL THEY LEARN!. All we need is a RWD 6 speed V8, and they NEVER give us one. I mean, why can't we just get a RWD v8 pushrod Alpha no less. And maybe a new Kappa, gamma and Alfredo.

(the next day)

GMIer: WHY DOESN'T GM have a 2 Mode, Direct Injection, Turbo 1.4 Liter ANYTHING yet? NO Wonder why they are failing.
(Same Thread)
GMIer: Yeah and WHY don't we have a RWD 6 Speed V8!? Oh with EXTRA pushrods.

The fact is, all GM has been doing wrong is listen to others, and have lazy corrupted executives.