GM Inside News Forum banner
1 - 3 of 34 Posts

· Registered
8,990 Posts
Honestly, I'm not so sure why GM's sales are down. Sure, you can guess reasons why, but nothing clearly stands out, particularly when you consider what GM is doing and what its competitors are doing, though something can be said for fresh vehicles. It doesn't explain the story completely, though.

If you look at the divisions that have received cash for new products, they're sales are up this year. Cadillac is up 10.9% (ahead of the market), and Chevrolet was next to receive cash (with some vehicles yet to be introduced) and is up 3.5% (albeit slightly less than the market).

GMC, the 2nd largest division at GM by sales and the division that everyone seems to think should get the boot, is up higher than the market (i.e., it seems to have proven its raison d'etre); sales are up 7.8%. There are other divisions that should go before GMC, in my mind.

Pontiac, perhaps through fleet sales(?), has seen its sales surge 12.5% this H1.

Much of GM's share slide is a result of the neglected divisions. Buick, which will be receiving much needed product (though I doubt that what's coming will be sufficient), is down 3.4% YTD (in an up market). Hummer, which we know is a fad vehicle and contributes in a very minor way to GM's total massive sales, is down 24.4%. But it, too, is receiving new product. The defunct Oldsmobile, which we all know is obviously going to post poor sales, is down nearly 65% YTD - that was a loss of almost 60,000 units in H1 of 2004. Saab, which really ought to can the Saab loyalists - it's a fleetingly small number of consumers - saw sales dive 20.6%. It needs a broader range of vehicles, which is why I agree with vehicle concepts as the 9-2X and 9-7X (though I'm disappointed in what Saab has served up in reality). Then, there's the truly neglected division, Saturn, down 22.9%.

Quite honestly, though, managing GM's enormous product portfolio is truly a daunting task that I don't think anyone here could do better than the people in charge at GM, despite people's claimed clairvoyance. Any simpleton can be a Monday-morning quaterback.

Many people have asked GM to improve in substantial ways: quality, productivity, and the adoption of lean manufacturing and constant improvement methods, to name four. To my knowledge, they have made substantial strides in many areas. As one example, it's in the company of only four other manufacturers who beat the industry average in reliability in the last dependability survey. LGR and Detroit/Hamtramck continue to outperform the vaunted Marysville, Ohio and Georgetown, Kentucky plants in terms of producing high quality vehicles. Of course, GM has made foibles; no one is perfect. But should they be punished with a 15% sales dive in an up market. Come on!

When I compare GM to its competitors, I'm honestly perplexed by their success and GM's failure. Are Kia's substantially better than comparable GM products to merit a 31% improvement in Kia sales?! Really? You think so? I certainly don't Kia has nothing on anyone, including price, that should merit that kind of performance. Yet, that's what GM is up against.

Are Toyota's that much better designed for that company to continue gaining market share at the expense of Detroit? Really? You honestly think the Corolla and Camry are such sexy vehicles that they should sell two:eek:ne to GM's comparable vehicles, particularly when GM's comparable vehicles outrank Toyota's in a variety of ways. I don't see that as being the fault of GM, per se. I had to drive a Camry to figure out what all the hype is about this 450,000 unit/year vehicle. I must have missed something on my test drive.

Lexus has quality, but Cadillac does, too. It's right behind Lexus and ahead of other luxury makes in a variety of ways. Then why should Lexus sales be up nearly 25% to Caddy's 10%? I cannot explain that. As an example, the ES330 (a gussied up Camry with lower quality and comparable price to the CTS) sells in droves; how is that explanable? Where did GM supposedly go wrong there? I cannot put my finger on it. Have you driven the ES330; I think it's quite uninspiring, and it has nothing on anyone in terms of design. The commercial professing its sporty inclinations is an absolute joke, but America seems to be swallowing that load of crap.

And do you think the Tundra is vastly superior to the Silverado? I don't at all, honestly. Yet Tundra sales are up double digits whereas the Silverado lags the market after June's poor showing (yes, Silverado sales dwarf Tundra sales). But why the discrepancy in rate of change of sales? GM dealers are better overall at satisfying customers than many other manufacturers, especially Toyota, so that can't expalin it.

Honestly, I'm dumbfounded by GM's poor showing. They have done a lot in the past 5 years that in my mind should at least merit flat sales, not such a nosedive in them. Do they do some products poorly? Absolutely and without a doubt. But, GM also does a whole lot right, and it should at least be rewarded with industry average performance.

· Registered
8,990 Posts
Originally posted by 4runner@Jul 3 2004, 06:01 PM
Have any of you guys driven a Toyota Tundra or Corolla? They're much quieter and use better interior materials than their compeition. Yes, GM's reliability has improved but they're still using cheap plastics and rattles seem to always pop up after 10K miles. The future doesn't look any better - look at the "New" Malibu - its interior is attrocious - Boob Lutz needs to go.

Next, look at resale value. After a 5 year period a the average Toyota holds on to much more of its value than a GM vehicle (with the exception being the Chevrolet Tahoe) (check your blue books). Why would anyone want to waste their money on a car that will lose 80% of its value over five years when they can have a car that will only lose 50%? Hell, even the discounts don't make up for it. GM needs to stop selling to fleets and scale back the employee discounts to prop up resale value.
That's it?! That's all you have to explain the domestics' poor showing?! Thrill me, then, with why Kia is doing so well. And why did Mitsubishi until recently?

And no, Peaches, the Malibu is not vastly inferior to a Corolla or Camry, which both need to learn from the Malibu in terms of initial quality and longterm reliability. Chevrolet can also teach Toyota about sales satisfaction, another objective measure in which Chevrolet creams Toyota. And if you think that the Corolla or Camry has anything on the Malibu in interior materials, you're simply not being honest with yourself. Let me guess: Toyota's designs are more appealing than Chevrolet's, right? Please...

I can go tit for tat with you on anything that Toyota does and anything that Chevrolet does. The point would be that Toyota is not vastly superior, which should mean that Toyota's performance should be equal (and not superlatively better) than Chevrolet's in sales.

Let's not go into all that Kia and Hyundai do quite poorly...

· Registered
8,990 Posts
Originally posted by AJR@Jul 3 2004, 11:20 PM
I was afraid this was going to happen. America's last two car companies were so sure they would gain market share this year, that they could almost taste it. It really makes me question the people in charge. Do they think they will capture market share just because they said they would?

I think the long run of incentives and other "come buy our vehicle" gimmicks has run its course. I see GM's new marketing incentives as desperation. GM seems to be so focused on the deal of the month that it doesn't spend the time to work on its products. However, the problem is that GM needs these incentives to get it to the time when the hot products do come out. But, these incentives, I think, throw a negative perception on GM's vehicles. It cheapens them in the long run...
As usual, AJR, your points are well taken.

I've wrestled with many of the issues that you raise. But I cannot help but think that each issue is immensely complex, and people's specious arguments for and against the things that GM does is irritating - I'm not referring to your thoughtful comments, incidentally.

Take the rebates issue. As we all know, GM screwed customers royally in the 80's and 90's, and they have paid enormously for it. Now, they appear to have seen the light (to some degree) and have made great strides to ameliorate their past wrongdoings. However, GM is in a precarious predicament: they need a carrot to lure the millions of people who have soured to the thoughts of buying a vehicle from GM into GM showrooms. How do you go about doing that? How do you consistently get millions of people to even walk in your showroom. You cannot wait until perception matches reality, and you cannot wait until Zeta arrives in 2007. There are decabillions in invested capital and decathousands of workers who by their contract are paid whether or not vehicles are built and sold. That's a significant financial liability. Not to mention the centithousands of shareholders to whom GM's executives must answer. They control a majority of the voting stock, and they want answers today. You need to make a return on your investment now, not in 3 years. Now.

Contrast that to the price you pay for offering generous rebates: a hindered recovery in perceived quality and desirability (as you illustrated) and diminutive profits. What do you do? There is no clear-cut decision.

I don't envy the positions in which John Devine, Gary Cowger, Bob Lutz, Rick Wagoner and their team find themselves (though their compensations certainly must make it more palatable!).

It's funny, when I buy many other consumer products, I don't think I give a second thought to where it's built or who makes it. As an example, I needed a replacement PDA for work. After several weeks of contemplation and research, I purchased one. Oddly, and quite sadly, only after I got it home and opened the package to charge it did I discover that it was made in China. How disappointing... But I love my PDA. Did I make a bad choice? I'm not so sure.

I imagine many Americans don't care from whom they purchase their car, much in the same way that I don't care about the brand of my PDA. Maybe there's a website that would roast me for purchasing my PDA... But for some reason, I have a stronger allegiance to car brands than I do to other consumer products.

I suppose that's why the world is seen through gray lenses as opposed to black and white ones.
1 - 3 of 34 Posts
This is an older thread, you may not receive a response, and could be reviving an old thread. Please consider creating a new thread.