How GM Can Keep up With Japan's Next Big Weapon: Planned Obsolescence

[Ming]

How Can GM Keep up the Competition and its Planned Styling and Technological Obsolescence?
Commentary by Ming
www.gminsidenews.com
4/15/06

GM's quality is steadily rising to the top, and even those in the media who still insist "GM doesn't make cars that people want" have come to admit that GM is ranking among the best in product quality over these past few years. If GM can eventually get American consumers to accept its advances and its position near the top of quality surveys, when all things are equal, how will GM stand out from the crowd? What will companies like Toyota use to stay one step ahead of Detroit? One answer is Planned Obsolescence, and GM had better be ready for it.

No, I'm not talking about intentionally designing a part to last only as long as the typical life of a vehicle. Rather I'm referring to using styling and catchy "gotta have" technology to keep customers buying new product and guaranteeing a customer segment of "early adopters".

My years in Japan taught me much about styling obsolescence. The pressure is always on to buy what are the latest, most attractive or stylish technological devices. At one time, dryers had to have "Fuzzy Logic", and rice cookers had to have "IH" for you to impress your friends and have the "in" products. In the early 90's, it was key for a car to have the letters "DOHC" plastered somewhere along the side of the car. Televisions with black plastic casings were seen as old, and silver painted housings seen as new. Flat screens in, bubble-shaped screens out. The dryers, rice cookers, and cars that didn't have these kinds of advances in styling or technology were less appealing, and as a result were left in the bargain bin.



Japan was and is all about having the latest and greatest, just for the sake of having it. To some extent, though I'm no expert, I'll assume that Korea is much the same, and perhaps Germany as well. And since innovations like Hybrids and DOHC are not easily introduced on an annual basis, the styling needs to change - and radically enough to keep people buying. Taking headlight design to wide and stretched up the hood like some Toyotas, and then shrinking them down to narrow slits over the course of 5 years or so is a result of these styling games the Japanese automakers play to make a used car of 3 years looks visibly "old" very quickly, and forces the lesser makers to keep up with resources that might be stretched thin.

GM is no stranger to planned styling obsolescence. Post World War II they engaged with the other Detroit automakers in strong competition and helped to introduce the whole concept, with a 3-4 year styling cycle as the norm with visibly different trim changes every 2 years. But I'll argue that GM hasn't been playing the game for the last 20 years, at least not with the bulk of its models, and certainly not with models like the Monte Carlo (no, NASCAR vinyl sticker packages don't really count).

Some GM fans expressed surprise this Auto Show season that Infiniti is refreshing the looks of the G35 so "soon" after first introducing it. This is because in America these days we are not used to seeing a car get a refresh until a good 5 years after introduction. That's time for a redesign for bread and butter models of the bigger automakers in Japan. And even the smaller automakers like Subaru or Suzuki would find ways to make a car like the Wagon R different nearly every year, with variants and special editions that would make a modern Detroit-based Marketer's head spin. The Suzuki Wagon R RR? Yes, that's three R's. The Nissan Cube V Selection? Pick a car on a Japanese automaker's website and you are almost guaranteed some kind of special trim or edition that is new for that year or within 2 years. Not so much with conservative cars like the Camry, but with the smaller (mini) "Kei" cars, where competition in Japan's domestic market is so fierce, these "special editions" are almost a must just to stay in the game.



Contrast that to how long the Chevrolet Cavalier or the Suburban went unchanged, or to the Astro and Blazer that lasted until 2005 with long styling cycles and very few visual modifications or "annual" special editions. Sure, you'd see some minor changes now and again, but unlike Japan's domestic mini car market, there was no sense of urgency to the refreshes and styling changes.

And of course it isn't just about looks. Toyota's emphasis on Hybrids is just another example of using a technology as a means of making cars from competitors look old and outclassed. DOHC, Variable Valve Timing; these technologies have lost their impact as differentiators now that most automakers employ them. Toyota USA's tag-line "Moving Forward" is a perfect companion to the hybrid technology as a differentiator. Its like saying "Look at us, we're advancing, and they're not,".



Recently GM has remade brands like Cadillac successfully, taking styling to the limits in a massive brand makeover. Then, as it is often said, GM turns its attention to the next brand that needs rejuvenation. Or at an individual vehicle level, GM has introduced cars like the Cobalt to good success. Will Cadillac's styling continue to look fresh and new as 2010 approaches, or will Infiniti's cars, for instance, see three facelifts in the time it takes for the CTS to have one? Can GM hope to compete with the profit-happy Japanese brands that have money to throw at frequent refreshes while GM is used to letting their best money makers like the Tahoe go for far too many years with an interior that looked old in 1999? How many more years will pass before GM gives the new Tahoe a refresh or redesign? The critical Cobalt?

Ford has two examples of the opposite extreme of what the Japanese automakers do that, in my opinion, have led to a drop off in sales. The Focus and Taurus - Ford let these once powerful nameplates deteriorate due to lack of investment and lack of visible change. Toyota or Honda would not have allowed this in a vehicle as important as the Taurus once was. Where Ford may make yet another a mistake is in introducing an all new car named "Fusion", without backing the investment far beyond launch. In five years will Ford need another Contour, Probe, Taurus or Fusion model name? If Ford felt it unnecessary to put the Focus on the new European platform, why should Ford fans feel confident that the Fusion won't also see decreased investment and a stagnant platform five years from now while Mazda and Ford of Europe advance to something newer?

Some say that the Camry, Civic and other popular Japanese cars remain strong because of their quality. While that may have been important in the past, it was also, in my opinion, because of the frequency of refreshes/redesigns, and the sheer money invested in keeping them relevant.

Why was GM was forced to discontinue a name like Cavalier? Was it due to a poor image based on quality alone? I don't think so. Letting a car languish unchanged for too long can have an even greater impact on image than quality.

Volkswagen is a good example of spotty quality that is overcome with frequent styling refreshes characterized by modern, relevant exterior and interior looks. The looks are so fresh and new that people will overlook quality concerns. The unique, frequently improved Diesel engines are also a draw for Volkswagen products. The Buick Century, on the other hand, had excellent quality ratings but looked old and wasn't getting many shoppers behind the wheel based solely on looks.

GM has proven that it can be nimble and react at least to negative feedback about the looks of certain models. The 2006 Malibu's grille is a good example of this. But rather than a reactive approach to styling, GM should build in a maximum of 2 years into a majority of new models that it makes from here on out, after which time it must introduce new styling features across the model line. GM simply cannot get by with perennial and stagnant styling on its vehicles. It cannot afford to "revitalize" Cadillac one year, and then come back to do that again five or six years later after hitting its other brands. Five years is simply too long. GM needs to return to the post-war mentality.



Would the Malibu grille change have happened if the public response to the grille had been excellent at launch? Would the GTO have gotten hoodscoops and a sport appearance package so quickly? Probably not. The problem is, the idea of "If it ain't broke don't fix it" will not fly in a market that is as competitive and cutthroat as Japan's domestic market. It won't fly when change happens for the sake of change and newness, and nothing else. And as the Japanese and European automakers gain market share in the US, Detroit will be hard pressed to ignore planned styling obsolescence as a marketing tool used to "outdate" their products.

Grille changes, taillight swaps, ground effects, new engines and transmissions, and the frequency of these changes are going to be a key way for GM to distinguish its models from the pack and keep customers once the Koreans and even the Chinese have caught up with GM's best brands on the quality front, and some will say that Hyundai is already there.

Although I'm not a fan of the stretched grille and squared off hoodscoops look, the Pontiac G6 GXP concept is the right idea. The looks have been altered significantly from the existing model. The same goes for the Grand Prix GXP, the Cadillac V-series models and other special editions. But the refreshes across the line must also come with haste. The base models, the volume sellers in most cases, should not go 5-6 years without a noticeable styling change.

All GM models, regardless of their success, should be given a 3 year refresh cycle, after which some significant change will appear across all trim levels. Having a hard and strict rule like this is the only thing that will keep GM from being left behind as the competition heats up. The days of an unchanging model like the Astro remaining competitive are gone. Being reactive is not enough. GM needs to design its front and rear fascias with the clear intent of modifying them 2-3 years down the line to keep them fresh.

While it may be tough for GM in its current financial state, I can guarantee that cash-rich competitors like Toyota will use planned obsolescence as a bludgeon against GM if they choose to ignore it.

[wpbharry]

I'll reply intelligently tomorrow after I have time to digest.

But the opening line "GMs quality is soaring" is pathetic. Soaring into what? The dumpster?

[DenCo]

Originally Posted by wpbharry

I'll reply intelligently tomorrow after I have time to digest.

But the opening line "GMs quality is soaring" is pathetic. Soaring into what? The dumpster?

Quality HAS been going up, despite what some people ignorantly continue to claim.

[wpbharry]

Oh really? Not according to long-term results. But, yes, according to short-term JDP idiocy.

It's very possible that the trannie in my Maxx is about to heave ho. Was replaced (per TSB), once in January for an intolerable whine. Dealer claims this was the first such repair they'd done, as the Julian Date range (GM ancient speak that hardly anyone can figure out) had me in a rare category.

Something is burning up in it right now. Bet the trannie is suspect, but even more likely, the gaskets. Yep, this after the gasket fiasco in the '98 Malibu. Edmund's has me suspect, but this car is under 10K miles. Wonderful, heh?

And let me count the ways that the "new GM" is crapola. New fuel tank (TSB), headliner (to fix sunshades; now there's a rattle in the headliner that's driving me out of my mind - well documented on Edmund's) (TSB), front struts are shot, as are every other '04 Maxx (GM can't find a fix yet), hatch struts collapsed (TSB), Body Control Module has a mind of its own (MANY TSBs), Power Control Module gets a reprogram every time I'm in for an oil change (MANY TSBs)(due shortly)....

Should I continue?

[jzEllis]

i agree 100%! but remember, Detroit stopped the 1-2 year restyle because of consumer demand for a longer styling cycle. and these days, you have over 3 generations that have grew up with 3-5 year styling cycles. will they except a restyle for the sake of restyle every 2-3 years like in the past? or yearly tech gimmicks to entice buyers? cars are a lot more expensive than laptops, mp3, players, or cell phones.

[mbukukanyau]

Originally Posted by wpbharry

I'll reply intelligently tomorrow after I have time to digest.

But the opening line "GMs quality is soaring" is pathetic. Soaring into what? The dumpster?

Where do you live?

[hunchman]

Originally Posted by wpbharry

Oh really? Not according to long-term results. But, yes, according to short-term JDP idiocy.

It's very possible that the trannie in my Maxx is about to heave ho. Was replaced (per TSB), once in January for an intolerable whine. Dealer claims this was the first such repair they'd done, as the Julian Date range (GM ancient speak that hardly anyone can figure out) had me in a rare category.

Something is burning up in it right now. Bet the trannie is suspect, but even more likely, the gaskets. Yep, this after the gasket fiasco in the '98 Malibu. Edmund's has me suspect, but this car is under 10K miles. Wonderful, heh?

And let me count the ways that the "new GM" is crapola. New fuel tank (TSB), headliner (to fix sunshades; now there's a rattle in the headliner that's driving me out of my mind - well documented on Edmund's) (TSB), front struts are shot, as are every other '04 Maxx (GM can't find a fix yet), hatch struts collapsed (TSB), Body Control Module has a mind of its own (MANY TSBs), Power Control Module gets a reprogram every time I'm in for an oil change (MANY TSBs)(due shortly)....

Should I continue?

you should be ashamed of yourself for posting such bull................you are piling it on too thick............seen your type many times before...........would not want to sell a person like you even a tire iron cause you would only bitch and complain about it...........

[ChevroletRevived]

It's going to be very hard, but I do think that there should be a significant change after 3 years, yes. But, it can't be major. The days of ''planned obselence" are in the past. Nowadays, it takes one year for a car to be profitable-or more, so changing every year would be a major financial strain on a company that has enough of it.

[FunkyPig]

It's all about marketing, and having a car out there that is always perceived as being in some way new. Often this isn't asking any massive investment, just some new bumpers and wheels each 2 years for example is a very cost effective way of keeping a design that is still modern, although a not brand new anymore, fresh. Good article, mirrors what I've thought for years. I think American car makers have to stop this continual cycle where they 1. release good car, 2. let it get old and lose sales and more importantly image, and then 3. replace it with a new nameplate and proclaim it to be the saviour.

If GM can't say (regarding a just released car) that they will update it the similarly to a Japanese (for eg.) competitor it should look at cutting other models and free up the design and engineering resources. Why have two midsize cars out there if they can't afford to keep either of them fresh in the face of the intense competition, kill off one of them and pour the total investment into the one car. One brilliant fresh car beats two dated cars that have no remaining brand image.

[Rick 2000]

wpharry you is soo wrong. Me and 8 more of my close friends have new
GM cars (between 5-12 month) NONE of us have had a reason too visit
a dealer for anything other than oil change. GM quality is way up , I my
self owns 3 GM cars.

[[Corporal Dan]]

Originally Posted by wpbharry

Oh really?

For every piece of anecdotal evidence you can give, I can give some to the contrary.

If you think Toyohonda doesn't issue tons of tsbs, think again.

[1BadPig]

Originally Posted by wpbharry

... as the Julian Date range (GM ancient speak that hardly anyone can figure out) had me in a rare category.

Julian date code is the simply the number of day in the year. For example, 0116 means the 11th day of 2006. The julian date code system is widely used in the high volume manufacturing industry. It is used to isolate production related issues in the field. This way the manufacturer can go back to a record (or records) to a certain period of time and analyze things. When there is a recall, they can isolate and minimize the total number of products in question.

[Butz]

You do make a lot of great points, I always wondered why can't GM refresh their cars more frequently just like back in the 50s and 60s.

[tgagneguam]

I find it funny that so many people are giving wpbharry a hard time for complaining about his frequent problems with his Maxx. While I don't agree with his inference that because his Maxx is having problems (that are similar to other recorded problems in similar vehicle lines from GM in the past) all GM vehicle quality sucks, I do feel for a man who presumably is a fan of the Company and who spent his wages on a GM vehicle and who is now having to make so many trips to the dealership for irritating problems. I'm fairly certain the man has much better things to do with his time than go to a dealership to whine to service reps about "alleged" shakes and rattles and such and then sit in a dealership while technicians spend hours tracking down "nonexistent problems." That just doesn't even make sense.

Everyone knows that I'm a cold, heartless, ornery ****************************, yet even I can feel for the guy. I'd be pissed! And GM should be concerned that another relatively young customer may not purchase another GM vehicle due to his experiences. How much does it cost to bring someone back into the fold once you lost them as a customer? I betcha GM is regretably too familiar with the figures.

[1BadPig]

Originally Posted by Butz

You do make a lot of great points, I always wondered why can't GM refresh their cars more frequently just like back in the 50s and 60s.

I think the retooling cost is something that GM cannot afford to do right now. The Japanese companies are riding high(er) on profitability. However, whenever a company begins to free spend (i.e., Ford buying premium brands, GM buying EDS & Hughes, Chrysler buying Lambo & LearJet.. I think) they start to lose focus. Toyota has been buying up some of their troubled competitors. It will be interesting to see how that will tear their focus from the core business.

GM needs to fix the marketing perception first and the improving quality index and value-pricing is beginning to work. But remember, it didn't take the Japanese overnight to make themselves the value leaders in any segment of the auto market.