GM exec: Sales slide finally over

**nadepalma** · 08-04-2006, 08:12 AM

Source: http://www.detnews.com/apps/pbcs.dll...0375/1121/AUTO

GM exec: Sales slide finally over
Brett Clanton / The Detroit News

Mark LaNeve, GM North America's vice president of marketing and sales, said interest in new models and upcoming products is helping the automaker gain ground in the U.S. market.

DETROIT -- Though still knee-deep in a turnaround, General Motors Corp. has halted a decades-long decline in its U.S. market share and may finally be in a position to grow sales again, a top GM marketing executive said Thursday.

Interest in new vehicle models such as the 2007 Chevrolet Tahoe SUV and a potential sales lift from upcoming products are helping put GM back in contention after excruciating declines in recent years, Mark LaNeve, GM North America's vice president of marketing and sales, said in an interview.

"We've stabilized share, and it's trending up," he said. "Have we turned a corner? Within the last nine months we have. Now, we have to go out and compete in August."

The upbeat assessment comes amid growing signs that a massive turnaround effort at GM is gaining strength. But GM's gains on the sales front could still be quickly wiped out by a number of factors beyond its control.

Sky-high gas prices could cut deeper into GM's all-important truck and SUV sales, rising interest rates could sideline would-be carbuyers and competition from foreign automakers could intensify.

Given the headwinds and remaining weak spots in GM's lineup, George Magliano, industry analyst for Global Insight Inc. in New York, predicts the automaker will continue losing ground.

The firm predicts GM's U.S. market share will bottom out at 23 percent by 2008, rather than hold at 27 percent, where it ended in July.

"I hope they're right," Magliano said. "But I wouldn't bet on it."

Through July, GM's sales were down 14 percent. The decline is largely due to unfavorable year-over-year comparisons with blockbuster sales last summer, when GM ran an employee-pricing-for-everyone promotion. This year's numbers also have been impacted by GM's move to reduce sales to daily rental fleets by 10 percent.

LaNeve said a truer measure of performance is retail sales to regular customers, which reflect strong gains for newly-introduced vehicles such as the Chevy HHR wagon, Buick Lucerne sedan and Pontiac Torrent crossover.

With the help of new vehicles, GM's revenue per vehicle has risen faster than the industry average this year, its incentive spending is down and the perception of its products is improving, LaNeve said.

The vehicles are at the heart of GM's plan to overhaul its ailing North American auto business, which despite the launch of a sweeping restructuring program is still in the red.

Under the program, GM says it will cut $9 billion in annual fixed costs by closing or downsizing a dozen factories, cutting 34,000 blue-collar jobs and shifting more health care costs to employees.

GM's recent sales trends are good news and should continue in the second half of the year once a newly-redesigned lineup of full-size pickups and new crossover vehicles for Saturn and GMC hit the market, LaNeve said.

"We've got great momentum in the turnaround. That said, we're still in a turnaround. We've got a lot of work left to do to get the company positioned not only to get our financial results in the black . . . but to really have a great and growing business for an extended period of time."

He also said it's not enough anymore to compare the company to crosstown rivals Ford Motor Co. and DaimlerChrysler AG's Chrysler Group.

"From both a standpoint of selling every month and the reputational issues, it's beyond just the three of us. There's at least six or eight primary players."

The shifting landscape in the U.S. auto industry was underscored last month when Toyota Motor Corp. passed Ford for the first time to become the nation's No. 2 auto seller.

GM's stock price has risen in recent weeks on the belief that its turnaround is taking hold. On Thursday, however, it closed down 41 cents at $31.20 per share in New York Stock Exchange trading.

Butz · 08-04-2006, 08:27 AM

I wont get too optimistic about a one-month performance.

69Firebird400 · 08-04-2006, 08:43 AM

From a market share perspective, according to the graph, it's actually a two-month performance.

Once they get past the brutal year-over-year comparisons against last summer's Employee Pricing for Everyone, plus having new and good products to sell, they will probably start to see more favorable press as their year-over-year results will look more positive. There are many variables here, not the least of which are the situation in the Middle East and Mother Nature (and her hurricanes), but the positive comparisons could start as soon as September IMO, because in 9/05, sales sort of tanked after all the pulled-ahead sales from employee pricing dried up year-end sales volume.

If the public starts to hear how GM's sales are growing 5%, 10%, whatever compared to the year-ago period, maybe that will help GM's perception in the marketplace.

mikesright · 08-04-2006, 09:03 AM

GM is stabilizing, for sure. GM is doing a good job of attracting people who were buying its trucks, and getting them into cars, as well as keeping its customers who are buying trucks, and conquesting those from other brands.

He's also confident because GM has many new cars and trucks coming out that represent a lot of volume, and are aligned toward rising gas prices. I predict by years end GM's monthly marketshare is over 30% again. The cost cuts have made GM more competitive in regards to cost, and next quarter we will start to see the gains from that.

GM-Joe · 08-04-2006, 09:09 AM

Yes, I made the mistake of investing a bunch in GM stock earlier this year because you should never invest in a company that is emotional to you; my Silverado is attested to that. But I did know that things were coming along and knew they would put everything into the GM900's. The GM900's will help for a year or two pushing up the stock, but the crossover's as well as the mid-sized sedans must be successful. I feel that the midsized sedans are the most important artifact because feed into the higher brands such as Cadillac, Saab, and Buick, but also feed into the crossovers and GM900's. If the Epsilon 2 platform is successful in winning back customers from the imports, then I believe the turn around will be momumental.

I would also like to see more emphasis to the compacts and subcompacts, but obviously they are being held in check until a new labor agreement is reached so they don't get stuck paying 140k per working plus benefits UAW member, where the imports nickel and dime their people for less than half that; but the Astra, Aveo, and Prevue are good starts.

mpsrent · 08-04-2006, 09:16 AM

I have a positive outlook towards GM's future as I see many exciting new models with the features that today's buyers are looking for. I can't say the same about the outgoing products that were desgined for a different market.

My only real concern is that the product coming out in the near future was not designed for today's significant fuel costs. If fuel costs's continue to escalate, there could be a significant shift by buyers looking to other product categories.

While buyers that need the features of a Tahoe or a Silverado will continue to buy these models and the new 2007 versions will ensure that they don't go to the competition (a good thing), buyers that really don't need truck features may look at cars and crossovers. When that happens, there is a strong possibility that they will look at other products built by other manufacturers. Even GM admits that the consumer loyality to their trucks is not the same as the loyality to their cars. Many a house has a Chevy truck in the driveway sitting beside a Toyota or Honda.

Its probably too early to tell.

Lewie · 08-04-2006, 09:17 AM

Quote:

Originally Posted by Butz

I wont get too optimistic about a one-month performance.

two months, actually. but it still doesn't mean much, we'll see how GM ends up in Dec.

boblutzfan · 08-04-2006, 09:22 AM

I'm just so glad that GM has so far resisted the employee pricing debacle again this year. When did it end last year? Anyone remember? I can't wait until we start comparing our sales figures to the post employee sales era.

dlr · 08-04-2006, 09:22 AM

I think for the next year at least with GM's Acadia/Enclave/Outlook and the new Fullx size trucks coming out, it should shape up to be a good 2007.

I hope the new Malibu and Coblat refreshes are good to make 2008 a stronger car year. I would also think by then we would see more 6 speed trannies to help out.

boblutzfan · 08-04-2006, 09:28 AM

Quote:

Originally Posted by mpsrent

I have a positive outlook towards GM's future as I see many exciting new models with the features that today's buyers are looking for. I can't say the same about the outgoing products that were desgined for a different market.

My only real concern is that the product coming out in the near future was not designed for today's significant fuel costs. If fuel costs's continue to escalate, there could be a significant shift by buyers looking to other product categories.

While buyers that need the features of a Tahoe or a Silverado will continue to buy these models and the new 2007 versions will ensure that they don't go to the competition (a good thing), buyers that really don't need truck features may look at cars and crossovers. When that happens, there is a strong possibility that they will look at other products built by other manufacturers. Even GM admits that the consumer loyality to their trucks is not the same as the loyality to their cars. Many a house has a Chevy truck in the driveway sitting beside a Toyota or Honda.

Its probably too early to tell.

I agree with much of what you said - some very good points. However, GM has done such a good job of bringing out new products and the ones in the pipeline look equally strong. Impala sales have been very strong despite reducing the reliance on fleet sales. The next Malibu due out in less than a year looks very good. This will help Chevy if buyers migrate away from SUVs. Pontiac has the G5 - even though it is a rebadge - it is a handsome car. It should sell well. The G6 finally got a DOHC engine which should help when people compare powertrains during the car buying process - sales should continue to increase. Buick has an updated Lacrosse coming as well as the class leading Enclave. The Lucerne has been a strong seller. GMC has the Acadia which should grow that brand. Saturn has the Aura out now and the Outlook coming. And finally Saturn has the very slick CTS coming in six months - which will capture some sales of folks turned off by the boring STS.

All this new product in less than a year - not counting the trucks. I think the non-truck product is just as strong (if not stronger) than the GMT-900 product. I think GM's market share will grow over the next year.

boblutzfan · 08-04-2006, 09:30 AM

Quote:

Originally Posted by dlr

I think for the next year at least with GM's Acadia/Enclave/Outlook and the new Fullx size trucks coming out, it should shape up to be a good 2007.

I hope the new Malibu and Coblat refreshes are good to make 2008 a stronger car year. I would also think by then we would see more 6 speed trannies to help out.

Malibu will be all new - the Cobalt will be a refresh. These should both help boost sales. I just hope GM gets the Malibu out as an early 2008 sometime next spring. Chevy needs this car ASAP.

Don't forget the updated Lacrosse, Pontiac G5, Saturn Aura and all new CTS. These will help GM's car effort.

markusername · 08-04-2006, 09:36 AM

This guy is a total moron. He figures the decades old slide of market share is over because of 2 months of positive market share?

I should have expected something like this from this idiot. After all he is the same idiot who claimed two winters ago that GM's sales were down because of the cold weather and snow. These were the same months that Toyota/Honda had record sales. I guess he thinks Toyota/Honda have the power to control the weather at their dealerships. Have you ever heard Toyota management blame snow for losing sales to the competition?

Does he really think the general public is this stupid? Weather (snow) only effects GM dealerships and not Toyota dealerships? A two month trend in market share means that a 30 year trend no longer exists? Now I understand where some of GM's problems come from with people like this helping to run the show.

Kheiron · 08-04-2006, 09:40 AM

I would have strong reservations about stating GM's US marketshare has stabilized. Maybe for the moment, but we all know too familiar of GM (and Ford and Chrysler) creating a few blockbuster hits (300, Charger/Magnum, Mustang, Fseries,900's) followed up by a few misses instead of continuous improvement and meticulous dedication to world class superior product every single year over year.

I hope it has stabilized but I won't be holding my breath until GM's Retaiil US Car Sales hold steady for a full few years with current/new product mix. Retail marketshare is the true measure of the strength of your brand, imo.

-Kheiron

Ultra Magnus · 08-04-2006, 09:50 AM

The 900s are a good start to a turnaround but GM still needs to prove they can make world class cars for the masses. I am yet to see a car that will compete with the Camry or Accord for the heart of the midsize market. It doesnt have to be one car but still the mid size cars that are out there arent winning over a lot of the media.

mbukukanyau · 08-04-2006, 09:52 AM

The Labda's are going to help. GM should now turn its attention to small pick ups and cars.

08-04-2006, 08:12 AM	#1 (permalink)
nadepalma GMI Staff Member Join Date: Jan 2003 Location: NJ Posts: 5,646	GM exec: Sales slide finally over Source: http://www.detnews.com/apps/pbcs.dll...0375/1121/AUTO GM exec: Sales slide finally over Brett Clanton / The Detroit News Mark LaNeve, GM North America's vice president of marketing and sales, said interest in new models and upcoming products is helping the automaker gain ground in the U.S. market. DETROIT -- Though still knee-deep in a turnaround, General Motors Corp. has halted a decades-long decline in its U.S. market share and may finally be in a position to grow sales again, a top GM marketing executive said Thursday. Interest in new vehicle models such as the 2007 Chevrolet Tahoe SUV and a potential sales lift from upcoming products are helping put GM back in contention after excruciating declines in recent years, Mark LaNeve, GM North America's vice president of marketing and sales, said in an interview. "We've stabilized share, and it's trending up," he said. "Have we turned a corner? Within the last nine months we have. Now, we have to go out and compete in August." The upbeat assessment comes amid growing signs that a massive turnaround effort at GM is gaining strength. But GM's gains on the sales front could still be quickly wiped out by a number of factors beyond its control. Sky-high gas prices could cut deeper into GM's all-important truck and SUV sales, rising interest rates could sideline would-be carbuyers and competition from foreign automakers could intensify. Given the headwinds and remaining weak spots in GM's lineup, George Magliano, industry analyst for Global Insight Inc. in New York, predicts the automaker will continue losing ground. The firm predicts GM's U.S. market share will bottom out at 23 percent by 2008, rather than hold at 27 percent, where it ended in July. "I hope they're right," Magliano said. "But I wouldn't bet on it." Through July, GM's sales were down 14 percent. The decline is largely due to unfavorable year-over-year comparisons with blockbuster sales last summer, when GM ran an employee-pricing-for-everyone promotion. This year's numbers also have been impacted by GM's move to reduce sales to daily rental fleets by 10 percent. LaNeve said a truer measure of performance is retail sales to regular customers, which reflect strong gains for newly-introduced vehicles such as the Chevy HHR wagon, Buick Lucerne sedan and Pontiac Torrent crossover. With the help of new vehicles, GM's revenue per vehicle has risen faster than the industry average this year, its incentive spending is down and the perception of its products is improving, LaNeve said. The vehicles are at the heart of GM's plan to overhaul its ailing North American auto business, which despite the launch of a sweeping restructuring program is still in the red. Under the program, GM says it will cut $9 billion in annual fixed costs by closing or downsizing a dozen factories, cutting 34,000 blue-collar jobs and shifting more health care costs to employees. GM's recent sales trends are good news and should continue in the second half of the year once a newly-redesigned lineup of full-size pickups and new crossover vehicles for Saturn and GMC hit the market, LaNeve said. "We've got great momentum in the turnaround. That said, we're still in a turnaround. We've got a lot of work left to do to get the company positioned not only to get our financial results in the black . . . but to really have a great and growing business for an extended period of time." He also said it's not enough anymore to compare the company to crosstown rivals Ford Motor Co. and DaimlerChrysler AG's Chrysler Group. "From both a standpoint of selling every month and the reputational issues, it's beyond just the three of us. There's at least six or eight primary players." The shifting landscape in the U.S. auto industry was underscored last month when Toyota Motor Corp. passed Ford for the first time to become the nation's No. 2 auto seller. GM's stock price has risen in recent weeks on the belief that its turnaround is taking hold. On Thursday, however, it closed down 41 cents at $31.20 per share in New York Stock Exchange trading. __________________ Email: nadepalma@gminsidenews.com "La vita è come un albero di Natale..c'è sempre qualcuno che ti rompe le palle!" "You cannot help men permanently by doing for them what they could and should do for themselves" -Abraham Lincoln "Democracy is the worst form of government except for all those others that have been tried" -Winston Churchill "In my many years I have come to a conclusion that one useless man is a shame, two is a law firm, and three or more is a Congress" -John Adams

08-04-2006, 08:43 AM	#3 (permalink)
69Firebird400 7.0 Liter LS7 V8 Join Date: Sep 2005 Location: Philadelphia Area Drives: 08 CTS DI RWD Nav, 08 Sienna Limited AWD Nav Posts: 5,639	Re: GM exec: Sales slide finally over From a market share perspective, according to the graph, it's actually a two-month performance. Once they get past the brutal year-over-year comparisons against last summer's Employee Pricing for Everyone, plus having new and good products to sell, they will probably start to see more favorable press as their year-over-year results will look more positive. There are many variables here, not the least of which are the situation in the Middle East and Mother Nature (and her hurricanes), but the positive comparisons could start as soon as September IMO, because in 9/05, sales sort of tanked after all the pulled-ahead sales from employee pricing dried up year-end sales volume. If the public starts to hear how GM's sales are growing 5%, 10%, whatever compared to the year-ago period, maybe that will help GM's perception in the marketplace. __________________ Autosavant Cars and Technology

08-04-2006, 09:03 AM	#4 (permalink)
mikesright 3.6 Liter V6 Join Date: Mar 2006 Location: Des Moines, IA Drives: 2009 Mercury Mistress Posts: 1,100	Re: GM exec: Sales slide finally over GM is stabilizing, for sure. GM is doing a good job of attracting people who were buying its trucks, and getting them into cars, as well as keeping its customers who are buying trucks, and conquesting those from other brands. He's also confident because GM has many new cars and trucks coming out that represent a lot of volume, and are aligned toward rising gas prices. I predict by years end GM's monthly marketshare is over 30% again. The cost cuts have made GM more competitive in regards to cost, and next quarter we will start to see the gains from that. __________________ 1,000 Posts, baby!

08-04-2006, 09:09 AM	#5 (permalink)
GM-Joe 5.3 Liter Vortec V8 Join Date: Jul 2006 Location: Columbus, Ohio Drives: 2007 Pontiac Grand Prix 1997 Saab 900 2.0 Turbo Posts: 1,431	Re: GM exec: Sales slide finally over Yes, I made the mistake of investing a bunch in GM stock earlier this year because you should never invest in a company that is emotional to you; my Silverado is attested to that. But I did know that things were coming along and knew they would put everything into the GM900's. The GM900's will help for a year or two pushing up the stock, but the crossover's as well as the mid-sized sedans must be successful. I feel that the midsized sedans are the most important artifact because feed into the higher brands such as Cadillac, Saab, and Buick, but also feed into the crossovers and GM900's. If the Epsilon 2 platform is successful in winning back customers from the imports, then I believe the turn around will be momumental. I would also like to see more emphasis to the compacts and subcompacts, but obviously they are being held in check until a new labor agreement is reached so they don't get stuck paying 140k per working plus benefits UAW member, where the imports nickel and dime their people for less than half that; but the Astra, Aveo, and Prevue are good starts. __________________ Current: 2007 Pontiac Grand Prix 1997 Saab 900 2.0 Turbo(148,500 Sobbing Saab on blocks) 1987 Chevrolet Silverado 10 (retired 11/12/2007; 219,986 mi.) Dead: 1983 Datsun 280 ZX by Nissan (146,857 mi.) 1986 Lincoln Mercury Lynx (64K mi.) 1979 Chrysler Cordoba w/ Corinthian Leather seats (130K mi.) 1976 Dodge Charger (130K mi.)

08-04-2006, 09:16 AM	#6 (permalink)
mpsrent 3.8 Liter V6 Join Date: Apr 2003 Drives: '04 GMC Envoy '06 Buick Allure(LaCrosse) Posts: 331	Re: GM exec: Sales slide finally over I have a positive outlook towards GM's future as I see many exciting new models with the features that today's buyers are looking for. I can't say the same about the outgoing products that were desgined for a different market. My only real concern is that the product coming out in the near future was not designed for today's significant fuel costs. If fuel costs's continue to escalate, there could be a significant shift by buyers looking to other product categories. While buyers that need the features of a Tahoe or a Silverado will continue to buy these models and the new 2007 versions will ensure that they don't go to the competition (a good thing), buyers that really don't need truck features may look at cars and crossovers. When that happens, there is a strong possibility that they will look at other products built by other manufacturers. Even GM admits that the consumer loyality to their trucks is not the same as the loyality to their cars. Many a house has a Chevy truck in the driveway sitting beside a Toyota or Honda. Its probably too early to tell. __________________ GMC Envoy

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08-04-2006, 09:22 AM	#8 (permalink)
boblutzfan 6.0 Liter LS2 V8 Join Date: Dec 2003 Location: San Antonio, Texas Drives: 2004 Mazda6s - V6/5-speed manual Posts: 4,276	Re: GM exec: Sales slide finally over I'm just so glad that GM has so far resisted the employee pricing debacle again this year. When did it end last year? Anyone remember? I can't wait until we start comparing our sales figures to the post employee sales era.

08-04-2006, 09:22 AM	#9 (permalink)
dlr 2.0 Liter Supercharged ECOTEC Join Date: Sep 2004 Posts: 182	Re: GM exec: Sales slide finally over I think for the next year at least with GM's Acadia/Enclave/Outlook and the new Fullx size trucks coming out, it should shape up to be a good 2007. I hope the new Malibu and Coblat refreshes are good to make 2008 a stronger car year. I would also think by then we would see more 6 speed trannies to help out.

08-04-2006, 09:36 AM	#12 (permalink)
markusername 3.8 Liter Supercharged V6 Join Date: Dec 2004 Posts: 670	Re: GM exec: Sales slide finally over This guy is a total moron. He figures the decades old slide of market share is over because of 2 months of positive market share? I should have expected something like this from this idiot. After all he is the same idiot who claimed two winters ago that GM's sales were down because of the cold weather and snow. These were the same months that Toyota/Honda had record sales. I guess he thinks Toyota/Honda have the power to control the weather at their dealerships. Have you ever heard Toyota management blame snow for losing sales to the competition? Does he really think the general public is this stupid? Weather (snow) only effects GM dealerships and not Toyota dealerships? A two month trend in market share means that a 30 year trend no longer exists? Now I understand where some of GM's problems come from with people like this helping to run the show.

08-04-2006, 09:40 AM	#13 (permalink)
Kheiron Banned Join Date: Jul 2006 Posts: 933	Re: GM exec: Sales slide finally over I would have strong reservations about stating GM's US marketshare has stabilized. Maybe for the moment, but we all know too familiar of GM (and Ford and Chrysler) creating a few blockbuster hits (300, Charger/Magnum, Mustang, Fseries,900's) followed up by a few misses instead of continuous improvement and meticulous dedication to world class superior product every single year over year. I hope it has stabilized but I won't be holding my breath until GM's Retaiil US Car Sales hold steady for a full few years with current/new product mix. Retail marketshare is the true measure of the strength of your brand, imo. -Kheiron

08-04-2006, 09:50 AM	#14 (permalink)
Ultra Magnus 3.8 Liter Supercharged V6 Join Date: Aug 2005 Location: Autobot City Posts: 599	Re: GM exec: Sales slide finally over The 900s are a good start to a turnaround but GM still needs to prove they can make world class cars for the masses. I am yet to see a car that will compete with the Camry or Accord for the heart of the midsize market. It doesnt have to be one car but still the mid size cars that are out there arent winning over a lot of the media. __________________ They said it couldn't be done. That is until I did it.

08-04-2006, 09:52 AM	#15 (permalink)
mbukukanyau 7.0 Liter LS7 V8 Join Date: Dec 2003 Location: In front of my computer Drives: 2006 HHR 2002 Corolla-Before I saw the light Posts: 8,058	Re: GM exec: Sales slide finally over The Labda's are going to help. GM should now turn its attention to small pick ups and cars.

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