The Truly Global GM: One and a Half Years Later

[Ming]

The Truly Global GM: One and a Half Years Later
And How having "too many" brands can be an asset
Commentary by Ming
www.gminsidenews.com
2/6/07

Back in September of 2005 I wrote a commentary here at GMInsidenews titled " Should a Truly Global GM Replace North American GM Brand Cars? ". With over 12,000 views, it spawned some excellent debate by our passionate members at the time, and even bled over into some other news forums and blogs.

I still think that a strong GM needs to be a "Global" GM. Not because I endorse some kind of Globalism that robs U.S. workers of their jobs, but because the best of GM's competition thinks globally and competes globally. Toyota doesn't let the fact that Scions and Lexuses are not produced in the U.S.A. interfere with selling them here. They don't make a practice of holding back great product from the North American market because of Union agreements or internal politics. They don't endlessly debate about "what the American consumer wants" before introducing cars like those in its Scion lineup --- cars that many predicted would fail for being "too Japanese".

Now, one and a half years later, I feel that GM is due some praise for the steps it has taken to make its U.S. lineup reflect the best of what it offers overseas. I honestly never would have thought that within two years GM would be offering a mildly restyled Holden Commodore as the Pontiac G8, or the Opel Astra as a Saturn. I had asked for it, but I did not expect it.

If one believes that GM is still a lumbering dinosaur unable to move quickly to adapt, then it would be logical to assume that GM already had these plans in the works or was deep in discussion with its subsidiaries regarding importing these cars before I had written my commentary. I'm not so full of hubris to assume that my article on this one forum out in a sea of automotive internet sites might have spurred these plans on. But that doesn't mean I don't want to congratulate GM for what it has decided to do, nonetheless.

The Saturn Astra, from the press photos we've seen, looks superb. Projector headlamps, 3 and 5-door styling (not some sedan with a tiny trunk) and as-is styling elements all over? Not one bit of apparent "blanderization" by the beancounters in Detroit looking to make a buck or two by stripping parts away that they think we might not notice? Wow.

The Pontiac G8, with a bold, masculine grille and edgy styling unlike the rumored Solstice front end swap? I've long felt that the as-introduced 2004 GTO's biggest problem was its 1990's "bubble" and swoopy styling. None of that in this new G8. It's modern and sharp-looking and is the first Pontiac that I've really wanted to own since my 2000 Bonneville SSEi. And this is thanks mostly to Holden. Detroit could have over-reacted to the lackluster debut of the last GTO and gone hog wild with some kind of bizarre restyle of the front end to avoid people saying "GM didn't do enough to make it look like a Pontiac". But common sense won the day, and the experts at GM realized that the new Commodore looks mighty handsome as it is, and didn't need extra ribbing or swoopy curves. Again, wow.

Many point out that GM has too many brands in the U.S. to support with enough unique models. It was the 1980's all over again when GM announced it would make the Crossover Sport Vans for no less than 4 of its U.S. brands, and the major difference between them would be slightly different grilles. We all know how that went down.

But having many brands can be an asset. How? Each of the traditional rebadged, re-grilled and or "reskinned" brands in the U.S. - lets face it, Pontiac fans, you know what brand I'm referring to - need not be a lineup of Chevy USA clones with different styling to some degree but otherwise mechanically identical (Torrent, SV6, G5). While it might be difficult to make the transition to "Holden USA", Pontiac, for example, could benefit from a unique to the U.S. market lineup for the first time in decades. No longer would you be able to get the same basic car with different styling down the road for less at the volume discount Chevy dealer or next door in the Buick showroom. As of now, the only Pontiac products that aren't some level of reskin or rebadge are the Vibe, and its a Toyota-engineered product with Toyota manufactured parts. Of course the "on hiatus" GTO, and the G6 Coupe/Convertible, which is unique.

To sum it up: the North American market-only brands that demand too much in the way of resources to keep competitive and unique can rely on very different models from overseas instead of just more styling variations of the same cars for each brand. It shouldn't stop with the Astra and G8. To give an expired example, instead of a 4th CSV (Relay), Saturn could have waited and gone with the Opel Zafira instead.

On the flip side of my article was an urging for GM to export more from Detroit. U.S. built Cadillacs are sold in Europe, Korea and China. But perhaps even more importantly, Detroit-engineered vehicles like the HUMMER H3 and Cadillac SLS (long wheelbase STS) are to be produced in more overseas locations, such as South Africa and China. This kind of development is vital for Detroit to remain a hub of engineering prowess. GM should encourage the global strength of Opel, Holden and GM Daewoo, but shouldn't rely on them completely and outsource all engineering to them. Toyota keeps the heart of its engineering at home, and Detroit's GM headquarters shouldn't make the mistake of thinking that they can outsource everything and just manage their hard-working global subsidiaries from their armchairs in Michigan.

Again, GM should be praised for these efforts. "American" cars and trucks sold and built overseas indicate to people around the world that Detroit-based GM is a global player and still very relevant despite the withering attack on its market share by Japanese automakers at its home of operations.

So what's left for me to ask for?

For one thing, GM is still not making full use of its GM Daewoo subsidiary in the U.S. market. Rather than yet another Epsilon-based reskin, a brand like Buick could use an entry-lux car in the form of the Daewoo Tosca, for instance. If its good enough to be Holden's Camry fighter, then its good enough for Buick, which sorely needs an injection of young, professional, bargain-hunting buyers who also want crisp, modern styling - not just an aging model with heavy rebates, or something they could buy from a Chevrolet dealer but with "Quiet Tuning" and a tri-shield badge. The kind who flock to Korean cars like the Hyundai Azera for the long list of built-in features and current styling elements. This is where the Daewoo-built Tosca beats 1996 Riviera-styled LaCrosse as Buick's entry-level car. That doesn't mean a car the size of the LaCrosse has no place in Buick's lineup. It's just that the current model is not designed in a way that effectively lures younger buyers to the brand, from a styling or pricing standpoint. Suzuki no longer sells the previous version (Verona) so that exclusive agreement, if it ever existed, should not stand in the way.

We saw the Aveo take the subcompact market by storm a couple of years ago and rise to the top. In an increasingly competitive market, GM Daewoo can deliver a high level of standard equipment for a low price, and modern, frequently refreshed styling. GM Daewoo is simply more nimble and able to invest in its much smaller product line than GM in Detroit (which recently decided it wasn't "worth it" to dedicate resources give the Cobalt a mid-cycle refresh, for instance), and can help keep GM North America's car offerings more diverse and fresh looking than what Detroit's GM can do alone.

Astra, Commodore (and Ute?), and Tosca (or next-gen Lacetti). These cars represent some of the best offerings from GM's global subsidiaries, and I look forward to seeing all of them here.

But for now, let me just congratulate GM for making the steps needed to integrate its various disparate brands around the world into the highly competitive U.S. market where they can help GM stand against the relentless onslaught of Toyota, Honda, Nissan and others.

Cheers to our mates in Australia and Germany for designing the great looking, competitive cars we'll come to know as Saturns and Pontiacs!

And maybe, just maybe what we'll see next will be a single model Chinese LaCrosse displacing the W/G-Body U.S. Buick LaCrosse and Lucerne, with a Daewoo Tosca / Holden Epica at the low-end "entry lux" for volume sales wearing a Buick badge as they do in China, a market where Buick is highly respected. Or a Holden Statesman replacing the Lucerne.

[jbartley]

i think the author meant H3's being assembled in South AFRICA, not south america.

This article is right on the money. The next couple years are going to be big moneysavers if GM continues this "global merging".

[Ming]

Originally Posted by jbartley

i think the author meant H3's being assembled in South AFRICA, not south america.

This article is right on the money. The next couple years are going to be big moneysavers if GM continues this "global merging".

Good catch. That is indeed what I intended to type. Must've had GM do Brasil on the brain.

[DuSpinnst]

Good for GM. Hopefully they can continue to focus on sharing technology and cars from the various design studios.

[nadepalma]

Originally Posted by jbartley

i think the author meant H3's being assembled in South AFRICA, not south america.

This article is right on the money. The next couple years are going to be big moneysavers if GM continues this "global merging".

Agreed. Lutz made the point when Goshn was pushing for an alliance that GM is really 4 or 5 separate automakers, each reinventing the wheel time after time. Obviously all of us know this, but seeing the necessary steps taken to integrate the company more fully and utilizing assets around the world is encouraging. I hope that this continues and pays big dividends at GM>

[usa1]

Well written Ming. Good job as always.

Mark

[MCGARRETT]

Why do you keep pushing this Daewoo Buick thing, the car looks like a warmed over version of the last Saturn L series, I am all for Buick getting a snazzy entry level mid-sized sedan or coupe, but not some Korean thing with a Buick badged slapped in the middle of the grille, pushing something like that while calling the G6 a "rebadge" (that word has totally lost all it's meaning) costs you some points, with me at least.

[Bvonscott]

Ming, I have an idea. On the left sidebar of GMI where the powertrain etc.. sections are should be a list of every vehicle GM currently produces with pictures, just to show how Global GM is. Plus I'd like to be able to print it out to use at work.

[Ultra Magnus]

I think Ming is on top of it as usual. If for nothing else, GM should use all these brands to diversify products around the world. Bringing the G8 here and exporting the Saturn Sky as an Opel are just two examples of what should be done. Its just good business sense. The big two hurdle as we all know are: the Auto Unions and International Currency/Trade exchange rates. No matter what GM does, it has to be profitable. I think GM has had great products throughout the rest of the world for a long time. Now it is time for GMNA to read the benefits of those years of design and engineering.

[Ming]

Originally Posted by MCGARRETT

something like that while calling the G6 a "rebadge" (that word has totally lost all it's meaning) costs you some points, with me at least.

Well, disagreements are fine by me, and welcome. And I tried to find my mention of the G6 anywhere...? Surely you didn't mean "G5" and would count the G5 that I listed?

Or if you mean where I call out "reskins" (I just changed the description of that above and added re-grilled and separated "reskinned" to clarify), then there are a lot of cars that fit that definition. Basically, if the only thing significantly different is the shell and maybe (or maybe not Impala/Lacrosse, Lucerne/DTS) interior, and the powertrain options offer at least one identical setup (especially in the mainstream base model trim), then its just a step away from "rebadge". And I'm not picking on only GM for this. Ford does this out the wazoo too.

Basically I have a problem with base level models having the same powertrain and platform and selling in the Buick and Pontiac showrooms in the same dealership, like the base Grand Prix and the base LaCrosse. Makes no sense to me, and the Automotive press still likes to rip GM for this. My friend barely knows a thing about cars but he's read somewhere about the various GM models that are only a shell away from being twins, and tells me about it whenever he sees them. Sometimes its in a good way (Solstice/Sky), and sometimes not.

Having more GM global cars in the U.S. potentially means not playing reskin or grille-jobs at the factory with sheetmetal and actually offering completely different cars in a given market.

And I still don't think a car that isn't offered at all in the U.S. market (Tosca) qualifies as a "rebadge", even if the actual process of badging it is just that. Technically yes, but when I can buy a Grand Prix and LaCrosse base level mechanical twins - one which shares its interior largely with an Impala, the other that shares its uplevel engine with the Impala - it becomes more about selling differently styled and equipped W-bodies than selling a "different" car than what is offered right down the street at the Chevy dealer, or right next door in the Buick BPG showroom.

Having 5 or 6 different versions of Epsilon (II) in the U.S. market seems to be the thing most people are pushing here, McGarrett, (and they seem to think the press / buying public won't care - I disagree) so I'm happy to stand alone in advocating the Daewoo solution for at least one of GM's brands. And I stand by my opinion that a Buick-styled Malibu, Aura or G6 (lets face it, the powertrain would be more likely than not identical) is not going to save Buick from irrelevance. But a value-packed Daewoo just might help. Its a risk, but at least its not more of the same.

[KingElvis]

Ming, you are clearly the most articulate, and perhaps most perceptive of the GMI staffers.

I wholeheartedly agree that if Buick and Pontiac are to survive, they can't sell expensive Chevies. Currently you can buy $30G sedan from Chevy - but also from Cadillac! At the least, they should offer a 'sport' $30G Pontiac and 'luxury' $30G Buick, and Chevy and Cadillac should stay about $5G away from that territory.

Have each division 'specialize' in just one or two platforms, and re-focus on the money spent on re-badging into better materials for example.

[DanCBJMS1988]

Great job, as always Ming. What's in that water in Icha Icha Paradise that allows you to write so brilliantly?

[Ming]

Gee, thanks for all the compliments guys, its good to hear, especially from people who've been around so long here and contributed so much. But I do absorb a lot of this from you, and I realized I think what McGarrett was getting at, and where I was remiss - the G6 Coupe/Convertible was not mentioned for being "unique" so I'll add it. Thanks McG!

[sigma]

Originally Posted by DanCBJMS1988

Great job, as always Ming. What's in that water in Icha Icha Paradise that allows you to write so brilliantly?

Ney... its not the water at all. It's all those special additives those friendly oil companies put in that Icha Icha Paradise (Houston) air

Seriously though, thank you Ming for providing such a great perspective on how far GM has come in just a few years time. In 2004 we never would have dreamed of seeing cars like the 08CTS, the 08Malibu, the return of RWD to the Chevy, Pontiac and Buick line-ups, and return of GM Design. So much has changed so quickly, especially when you consider the size and girth and excess at a corporation the size of General Motors.

I do have some qualms about putting any Daewoo in the Buick line-up. I think an EPII or SWB Zeta/SWB Sigma car would serve much better as an entry level vehicle.

[Ming]

Thankfully I live far NW of Houston, and not in Pasadena. Fine for you Urban Cowboys, just not for me.