GM: Time to Consolidate

[vcs2600]

Originally Posted by SierraGS

have you learned one thing from the Oldsmobile disaster?

What I learned from the Oldsmobile disaster is that all these brands are a weight around drowning company's neck. Oldsmobile also only accounted for a very small percentage (~10%) of GM's marketshare losses over the last decade; Buick and Pontiac have lost more marketshare while remaining open than Olds did by closing. Anyone who insists that GM should have spent billions of dollars to sell 200,000 Oldsmobiles mostly to rental car fleets is not looking at things very objectively.

Explain why it is OK for GM to throw away 3-5 Billion dollars closing BPG dealers.

GM is going to have to spend billions of dollars closing down dealerships no matter what, in order to adjust to their new position as an automaker with maybe 20% marketshare.

Explain why GM will enjoy getting dragged through the courts for the next 5 years on non stop lawsuits from dealers and cities (25% of sales tax revenue in many cities are derived from car dealers).

What other option do they have? When GM can't afford to provide product, they're going to get sued anyway.

There are many countries where the Chevrolet will not be sold in and GM needs a truck brand and that brand will be GMC.

Chevy has already been rolled out internationally, so what countries are these? Other than South Korea and Australia where GM has established brands, I don't know of any place that doesn't have Chevrolet. (And its not like pickups and giant SUVs really sell many places anyway.)

Also note that I'm not necessarily arguing that they need to shut down GMC. They do need to radically consoidate their dealer channels though and that means that losers like B/P/G and Saturn no longer need to exist independently.

[SierraGS]

Originally Posted by vcs2600

What I learned from the Oldsmobile disaster is that all these brands are a weight around drowning company's neck. Oldsmobile also only accounted for a very small percentage (~10%) of GM's marketshare losses over the last decade; Buick and Pontiac have lost more marketshare while remaining open than Olds did by closing. Anyone who insists that GM should have spent billions of dollars to sell 200,000 Oldsmobiles mostly to rental car fleets is not looking at things very objectively.

GM is going to have to spend billions of dollars closing down dealerships no matter what, in order to adjust to their new position as an automaker with maybe 20% marketshare.

What other option do they have? When GM can't afford to provide product, they're going to get sued anyway.

Chevy has already been rolled out internationally, so what countries are these? Other than South Korea and Australia where GM has established brands, I don't know of any place that doesn't have Chevrolet. (And its not like pickups and giant SUVs really sell many places anyway.)

Also note that I'm not necessarily arguing that they need to shut down GMC. They do need to radically consoidate their dealer channels though and that means that losers like B/P/G and Saturn no longer need to exist independently.

The lesson from the Oldsmobile disaster was that GM lost 200,000 sales a year to the competition and paid billion$ to do it!!!!

GM has to drop this idea of closing dealers as it will result in the same outcome from the Oldsmobile disaster, it will pay billions of dollars to give away customers.

GM can afford new product from profits from overseas operations and consolidating platforms and will save billions going forward from labor cost savings - all are happening now and GM's new lineup is selling well and future product looks great.

Who says GMC has to sell large pickups and SUV's in other countries?

Small pickups and SUV's sell very well in the new industrial countries - it is a sign of a growing economy, trucks are WORK vehicles and MORE WORK = MORE TRUCK SALES = GROWING ECONOMY.

Remember - it costs the same to market a Buick Solstice, G5, G6, LaCrosse, G8, Lucerne, Vibe, Torrent and Enclave as it does to split them between Buick and Pontiac.

[vcs2600]

Just because you are in denial about the dealership network consolidation and overhaul needed doesn't mean it isn't going to happen. Billions will be spent, like it or not.

GM's current brand structure has resulted in a least a 10 point loss in marketshare in 10 years and dozens and dozens of failed products. If and when GM starts increasing marketshare and turns a profit in North America then you might be able to argue that they are doing it right, right now all the evidence points against it.

[Buickman]

here's a novel idea...find someone who knows how to grow the business and get about rebuilding the brands that we have, G3, G5, G6, G8, Gee Willikers! let's go back to Monte Carlo, Grand Prix, LeSabre, Wildcat, Roadmaster. let's build some cars with great interiors and appealing colors. let's change the marketing and let our retail partners go to work the right way. let's change our advertising to what actually gets results.

cut, spin, sell, borrow, or sell like hell and work our way out of debt and restore the dividend.

[Aprime]

Originally Posted by TriShield

Chevrolet is not only GM's strongest and most well-known brand but there isn't anything it can't do or do better than any of GM's other brands except for perhaps Cadillac.

Even with the substantial money and effort GM has put into Cadillac it's still teetering on the brink and not exactly relevent in the luxury car market.

There's one thing it certainly cannot do, and that's bringing back the youth.

[CadiEldo67]

Originally Posted by sjsjedi

Maybe they will tune the Pontiac's to handle better much like Ford does with Mazda.

This would actually work. Few people look at a Mazda and say "its a Ford" Even Lincoln for that matter.

For Pontiac, I recommend using retro names, even if they were from concepts. Pontiac does have a heritage, something that imports are gaining, but Pontiac's heritage is more desirable, and I'm not talking of the '90's(which weren't all that bad, but you know..)



Grand Am= In Sedan/Coupe/Convertible Forms (on Kappa II/ Alpha SWB)
^(Solstice)

Grand Prix=In Sedan/Coupe/Convertible (on Alpha/Epsilon II AWD)
^(Firebird/TransAm)

Bonneville=In Sedan/Coupe/Wagon forms (on Zeta)
^(GTO/Safari)

If Pontiac gets AWD standard on FWD platforms, or if Alpha comes alive, then there will be little to no overlap with Buick.
__________________________________________________ _____________

Buick needs
Invicta= In sedan/coupe forms (Epsilon II)
Park Avenue= Sedan only (Stretched Epsilon II) *(Shared with new Impala)
Enclave=As is, with improvements as necessary

__________________________________________________ ______________

GMC needs to determine which SUVs/Trucks are staying in the lineup. I believe that either the Cadillac Escalade, or the Yukon Denali need to be eliminated, unless they are both doing really well, in which case, leave them alone. The Canyon and Envoy should become a similar body style(like the Jimmy and Sonoma) and should use a lighter unibody platform. For those that need BOF Trucks and SUV's, they buy the Yukon/Sierra.

Terrain - Smaller compact SUV on Theta II? uses 3.0/3.6 DI
Canyon/Envoy - built on new Omega unibody platform (similar to Honda Ridgeline, but smaller)
Acadia - as is, but with improvements, available with 3.0/3.6 w/ DI
Yukon/Sierra - GMT-900(possibly last of BOF suv's/pickups)*possibly could work on stretched Omega platform?
Savana - on GMT, but similar fate to Sierra/Yukon

[schmallz]

Chevy: Bread and Butter. For the person that just needs to get from A to B
FWD
Micro Beat
Sub-Compact Aveo
Compact CobaltCobalt
Mid Size Malibu
Full Size Impala
RWD
Camaro
Corvette

Trucks/Crossovers
Equinox, Traverse, Tahoe, Silverado, Canyon.

Buick: Semi-Premium, Comfortable Traditional American Luxury
FWD
Compact Excelle
Mid Size Invicta
Full Size Park Avenue
RWD
Velite

Crossovers
Uber Luxry baby enclave, Enclave

Pontiac: Cheap RWD Performance
RWD
Sub-Compact SWB Alpha
Compact LWB Alpha
Mid Size Zeta
Full Size Zeta

GMC: Near Luxury Trucks
Sierra, Sonoma, Yukon

Caddy: Premium RWD Performance Luxury
RWD
Sub-Compact ATS
Compact BTS
Mid Sie CTS
Full Size DTS
Personal Limo FTS

Crossovers
BTX, CTX and DTX
replace the escalade with the DTX, the Denali is fine as it is.)

No Saturn!

[SierraGS]

Originally Posted by Buickman

here's a novel idea...find someone who knows how to grow the business and get about rebuilding the brands that we have, G3, G5, G6, G8, Gee Willikers! let's go back to Monte Carlo, Grand Prix, LeSabre, Wildcat, Roadmaster. let's build some cars with great interiors and appealing colors. let's change the marketing and let our retail partners go to work the right way. let's change our advertising to what actually gets results.

cut, spin, sell, borrow, or sell like hell and work our way out of debt and restore the dividend.

Exactly, GM needs someone focused on GROWTH - as long as GM continues to cut, cut, cut it WILL NOT GROW.

I do not care what reason there is for "cost cutting" it will always result in "REVENUE CUTTING" which results in LOST INCOME and leads to LOST MARKET SHARE - Consumers do not want to deal with LOSERS.

GM's upcoming products look great and have potential but what is GM really focused on? Getting rid of dealers.

This makes it inconvenient for the customer to buy the car and get it serviced later and gives a prospective customer the idea that GM is going out of business.

It costs money to drop dealers, GM should take that money and spend it on marketing the great cars in the pipline, better sales will eliminate the need to drop dealers - I do not see Wal-Mart closing stores and Toyota is adding dealers. IF GM presents itself to the public as aggessively growing business, public perceptions will change and GM will sell more cars.

As I have stated before this starts with focusing only on building a brand one great model at a time with full marketing support and the only cuts being models that are not producing sales AND are at the end of their current market cycle.

I think you are on the right track with a new Monte Carlo or Grand Prix not like recent ones but like the originals - think how well a new Grand Prix LJ or SJ (like the 68 and 69 models) would be recieved or a new Monte Carlo with some clean elegant styling that the first Monte Carlo had - NOTE I am not saying they have to look like the originals and they definately do not all be 2Dr Coupes, but cars that ingnite a passion to buy them.

[SierraGS]

Originally Posted by vcs2600

Just because you are in denial about the dealership network consolidation and overhaul needed doesn't mean it isn't going to happen. Billions will be spent, like it or not.

GM's current brand structure has resulted in a least a 10 point loss in marketshare in 10 years and dozens and dozens of failed products. If and when GM starts increasing marketshare and turns a profit in North America then you might be able to argue that they are doing it right, right now all the evidence points against it.

GM cannot slash dealers here and there and think it will survive, I have never seen a retailer or auto company do this and remain the original company.

Cutting retail outlets (which are what dealers are) tells the consumers in that area that they are not worth your trouble to sell to them, leaving a VERY BITTER taste in their mouths and they will make you pay for it.

Do you ever wonder why you still read passionate hate posts from ex-GM owners (and current owners of competitors cars) about GM dropping Oldsmobile years after the fact? Looking for where the lost market share went? You might start there and these buyers are never coming back to GM.

GM is the undisputed champ of getting rid of loyal customers, sometimes it seems they are actually trying to get rid of them - they drop a model mainly because they chose to neglect it or not revise it in a way many loyal customers directly request they do. Car makers with rising market shares do not do these things, GM management has not learned the automotive business is not like running an appliance one and that models, brands and close proximity to the end user are important.

As long as GM cuts dealers it will lose market share and then it will cut more dealers and lose more market share then they will ........

Do I really have to continue?

[jkr2106]

Originally Posted by SierraGS

Exactly, GM needs someone focused on GROWTH - as long as GM continues to cut, cut, cut it WILL NOT GROW.

I do not care what reason there is for "cost cutting" it will always result in "REVENUE CUTTING" which results in LOST INCOME and leads to LOST MARKET SHARE - Consumers do not want to deal with LOSERS.

I totally agree with this. I hate the doom-and-gloom talk; it comes across as very defeatist.

GM's upcoming products look great and have potential but what is GM really focused on? Getting rid of dealers.

I think you are misrepresenting GM's stance on dealer consolidation. The never said they were focused primarily on that, but it is a concern that they are addressing among others.

This makes it inconvenient for the customer to buy the car and get it serviced later and gives a prospective customer the idea that GM is going out of business.

It costs money to drop dealers, GM should take that money and spend it on marketing the great cars in the pipline, better sales will eliminate the need to drop dealers - I do not see Wal-Mart closing stores and Toyota is adding dealers. IF GM presents itself to the public as aggessively growing business, public perceptions will change and GM will sell more cars.

You are confusing dealer consolidation with simply buying out dealers. GM has never tried to take all the dealers out of any area. What it wants to happen is have less dealers in any area so they don't compete with one another on each sale driving down transaction prices. And about marketing, with less Chevy dealers in an area, each dealer will have more revenue so it will be able to spend more on the customer experience (grounds maintainance, more frequent remodeling, better lighting,...). This is probably one of the better forms of marketing. Modern dealers give the impression of a successful franchise and bring in more prospective buyers. Then once inside, buyers can be seduced with free starbucks and plasma screens. Two really good/modern dealers in a city will give the impression of an "agressively gowing business" moreso than 20 whose structures date to the seventies.

[vcs2600]

Originally Posted by SierraGS

GM cannot slash dealers here and there and think it will survive, I have never seen a retailer or auto company do this and remain the original company.

GM is about to fall below Toyota in domestic marketshare, they haven't been the "original company" that dominated US autosales for a long time. That's reality.

Realize that GM intentionally flooded markets with extra franchises in a previous era to increase volume. What they've learned is that two crappy dealers do not equal one good dealer. Their per-dealership sales are just pathetic compared to the asian makes, which results in the worst sales people, the worst facilities, and so on.

Do you ever wonder why you still read passionate hate posts from ex-GM owners (and current owners of competitors cars) about GM dropping Oldsmobile years after the fact?

First of all, a half-dozen people on a GM fanboard is not a mass-movement. Olds wasn't selling anything, nobody really gave a crap that they shut down (except maybe the rental car firms).

Second if you go back a couple pages, I'm not advocating shutting down brands, only reducing them to a couple models while shifting sales to Chevy/Cadillac.

Looking for where the lost market share went? You might start there and these buyers are never coming back to GM.

Olds only accounted for about 1 point of GM's 10+ point loss in marketshare over the last decade. If you think that customers are abandoing GM in droves because of Olds, you are just factually wrong.

GM is the undisputed champ of getting rid of loyal customers, sometimes it seems they are actually trying to get rid of them - they drop a model mainly because they chose to neglect it or not revise it in a way many loyal customers directly request they do.

I agree, but it isn't just because GM is dumb, they are also broke. They simply do not have the resources to be competitive with their current structure. The result is uncompetitive products, long model cycles, limited advertising, obsolete technology, rebadges galore, poor quality, etc etc etc. And the result of that is a terrible consumer reputation and massive losses in marketshare.

This has been going on since the 1980s, and there's no way to fix it other than cutting models until they can afford to keep up the 3/6 year pacing of their competitors.

Now you tell me how a near-bankrupt company can properly support 8+ brands properly without heavily restructuring their model lineups and dealership networks.

As long as GM cuts dealers it will lose market share and then it will cut more dealers and lose more market share then they will ........

Do I really have to continue?

Only if you want to ignore recorded history and cheerlead GM into bankrupcy.

[SierraGS]

Originally Posted by vcs2600

GM is about to fall below Toyota in domestic marketshare, they haven't been the "original company" that dominated US autosales for a long time. That's reality.

Realize that GM intentionally flooded markets with extra franchises in a previous era to increase volume. What they've learned is that two crappy dealers do not equal one good dealer. Their per-dealership sales are just pathetic compared to the asian makes, which results in the worst sales people, the worst facilities, and so on.

First of all, a half-dozen people on a GM fanboard is not a mass-movement. Olds wasn't selling anything, nobody really gave a crap that they shut down (except maybe the rental car firms).

Second if you go back a couple pages, I'm not advocating shutting down brands, only reducing them to a couple models while shifting sales to Chevy/Cadillac.

Olds only accounted for about 1 point of GM's 10+ point loss in marketshare over the last decade. If you think that customers are abandoing GM in droves because of Olds, you are just factually wrong.

I agree, but it isn't just because GM is dumb, they are also broke. They simply do not have the resources to be competitive with their current structure. The result is uncompetitive products, long model cycles, limited advertising, obsolete technology, rebadges galore, poor quality, etc etc etc. And the result of that is a terrible consumer reputation and massive losses in marketshare.

This has been going on since the 1980s, and there's no way to fix it other than cutting models until they can afford to keep up the 3/6 year pacing of their competitors.

Now you tell me how a near-bankrupt company can properly support 8+ brands properly without heavily restructuring their model lineups and dealership networks.

Only if you want to ignore recorded history and cheerlead GM into bankrupcy.

Cutting dealers will result in GM's demise - period.

The 1 point of market share lost by Oldsmobile is very important and GM lost customers of other brands as illustrated by the 10 point drop, as I pointed out once you start cutting brands/dealers future customers are going to ask "is my brand/dealer next?".

You keep missing the point, GM has to focus entirely on one thing and only one thing - give each brand a solid model and rebuild each from that.

It will take time, but Honda and Toyota both started with one model and built themselves up on model at a time and when a model failed they learned from it and made rapid change. They NEVER turned their backs on the customer or the dealers selling their product.

And that is how GM can rebound, you keep forgetting GM's brands outside the U.S. do make money and use that money to develop the great lineup GM has in the pipeline - a pipeline that GM just has to align with the U.S. market, and put the right product with the right U.S. brand.

This is happening now as the Malibu and CTS are showing great sales which will be built upon with future models based on the RECENTLY REDESIGNED (and paid for) GAMMA, Delta, Epsilon and Zeta patforms will also do well AND eliminate any need to drop dealers.

Do you pay any attention to what GM is doing outside the U.S.?

[SierraGS]

Originally Posted by jkr2106

I totally agree with this. I hate the doom-and-gloom talk; it comes across as very defeatist.

I think you are misrepresenting GM's stance on dealer consolidation. The never said they were focused primarily on that, but it is a concern that they are addressing among others.

You are confusing dealer consolidation with simply buying out dealers. GM has never tried to take all the dealers out of any area. What it wants to happen is have less dealers in any area so they don't compete with one another on each sale driving down transaction prices. And about marketing, with less Chevy dealers in an area, each dealer will have more revenue so it will be able to spend more on the customer experience (grounds maintainance, more frequent remodeling, better lighting,...). This is probably one of the better forms of marketing. Modern dealers give the impression of a successful franchise and bring in more prospective buyers. Then once inside, buyers can be seduced with free starbucks and plasma screens. Two really good/modern dealers in a city will give the impression of an "agressively gowing business" moreso than 20 whose structures date to the seventies.

The only thing I can tell you is that Honda, Hyundai, Nissan and Toyota are all expanding their dealer presence out here and move into areas where U.S. brands leave and thrive. Most dealers out here are located in "Auto Parks" with Honda, Nissan and Toyota represented in all of them, GM cannot afford to drop these dealers and only need to help properly realign them with sales channels. I think that the market will weed out the weak dealers.

GM should get product feedback from the dealers, LISTEN to it and ACT upon the most common ones as well as ones that will boost sales in weak markets.

GM needs to keep the focus on product and let the dealers sell the products as best serves their local customer base, this will save GM money on duplication of managemant/marketing resources and make decision making based more on dealer feedback than market research. Not saying GM should stop market research or leave all marketing to dealers, but there is duplication of effort here that only complicate and slow decision making.

[vcs2600]

Originally Posted by SierraGS

Do you pay any attention to what GM is doing outside the U.S.?

Yes, they make money outside of the US. With a simple brand structure, I might add.

Anyway, you go on hoping. I'll be getting my chuckles from the rebadges and lame-duck junk at PBG until they finally shut it down.

[SierraGS]

Originally Posted by vcs2600

Yes, they make money outside of the US. With a simple brand structure, I might add.

Anyway, you go on hoping. I'll be getting my chuckles from the rebadges and lame-duck junk at PBG until they finally shut it down.

GM is adding Buick, Cadillac, Chevrolet, HUMMER, GMC and even Pontiac brands to markets outside the U.S. along with more dealers.

As long as GM keep the U.S. sales channels to four (like Toyota) they will be fine.