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July 13, 2005General Motors is in troubleGeneral Motors is in big trouble. They have a bloated product line with confusing duplicate models across their various brand names. And the recent steep rise in fuel costs have soured consumers on GM's profit-center, large fuel guzzling vehicles, to the point that they have been forced to offer steep discounts and rebates to reduce the giant inventory of unsold cars off the dealers' lots. Additionally, GM is hampered with a huge contractual commitment to provide health insurance coverage to their employees and their retirees (who now out number current employees) that combine to add $1600 per vehicle in costs not related to making or marketing cars. And if that was not bad enough, General Motors was forced to pay FIAT a $2 billion divorce settlement when it appeared that was a more cost effective move than invest several times that much to complete a corporate merger with the Italian automaker. In balance, all is not well for GM. Say what you will about General Motors, they do try to sell cars. The above-mentioned discount program, the "You pay what we pay" Employees Price for most GM models has effectively moved a lot of excess inventory off the lots in the month of June 2005. In the 1930's General Motors stirred consumer interest with elaborate car shows called "Motorama" in major cities that offered an idealized World of Tomorrow. These shows touted the easy and luxury of modern living, featuring dream car versions of future car designs along side current models offered for sale right now. In the years directly after World War II, GM took the show on the road in a direct marketing approach that was based upon a barnstorming circus of specially constructed truck/bus vehicles that brought the Motorama show into the US hinterlands. Rural consumers could see and touch the new cars and future models in their own home town rather than reading about them or seeing them in the newsreels. As TV made a greater penetration into the US market, the need to take the products directly to consumers diminished and by the mid-1950's the General Motors traveling Motorama was a memory. Desperate times call for desperate measures, and GM is desperate right now. From a market share of over 50% of the US market, GM has slipped to holding less than 20% of the American car market. Along with innovative marketing and brand positioning (Led Zeppelin's rock music anthem "Rock and Roll" used to sell Cadillacs is unthinkable to those of us who remember when that song was fresh on the music charts 30+ years ago) GM has reached far back into its marketing bag of tricks to revive the traveling Motorama... with a twist. The General Motors traveling car show is now called Auto Show In Motion and rather than a static display of only General Motors current offerings, this show offers examples of the competition's cars for comparison. But wait! There's more! At this show, you the consumer, are invited to test drive the GM and competitor's cars in a side-by-side comparison right there at the show. Bring your driver's license and you get to flog everything GM has to offer from the smallest Cobalt to the most powerful Corvette and then jump into a comparative model from the other manufacturers. I received an invitation to my local edition of this traveling car show to be held in the large parking lot of a local sports stadium in a direct mail solicitation. But it is possible for anyone to sign up for the event by going to www.autoshowinmotion.com and filling out the simple questionnaire. I normally resist marketing come-ons like this; I am immune from time-share free gift offers, chances to win a dream cruise or similar huckster ploys. I am especially loath to give up any of my free time for a blatant marketing event such as this. But this event runs four days, Thursday to Sunday, and I can slip a little spare time into my schedule to check it out early on a Thursday morning. And in the interests of providing you, the At Home Mechanic faithful, with objective observation I am planning to attend and report my findings. Posted by Scott at July 13, 2005 9:22 AM CommentsWhile many auto enthusiasts are reap the benefits of platform sharing, and many companies enjoy the cost savings it provides, GM has taken it to a bad place. Their product line is bloated, and with cars that are often competing with other GM cars. What good is making 3 cars from one platform, if they are all the same and cannibalize each other's sales? GMC could be entirely eliminated. They don't have a single product that is entirely unique. Take the luxury elements and allow Chevy to have some, and Cadillac to have others. Many of the divisions just need to be refocused and given some autonomy to build whatever they need to achieve their goals. Cadillac is doing well competing with Lexus, and to some degree, BMW. Buick should target Acura. Pontiac should target Nissan and Mazda. If they are supposed to be the exciting brand, the enthusiast's brand, they need to focus only on making exciting cars. Saturn is more or less ok. Chevy should be building basic cars, appliances. That said, they should be building top notch appliances. Chevy dealer service tech's should be as bored as Maytag repairmen are said to be. They need to take a play from Honda and Toyota and build nicer interiors. They don't have to be luxurious, but the details and quality have to be there. Ergnomics and control placement are important, and my last experience in a late model GM vehicle still says they have a long way to go. Oh, and SUVs won't win over Saab buyers, and probably won't win over non-Saab buyers either. And if they absolutely must build one, why not build it from a car platform instead of a Chevy Trailblazer? Posted by: Bryce at July 15, 2005 5:36 PM I can't believe it, my co-worker just bought a car for $57135. Isn't that crazy! Posted by: Betsy Markum at April 8, 2006 5:21 PM http://simple.healthfitness.com.au/simplenews/messages/16500.html complimentwhosewondered Posted by: constructions at June 2, 2006 3:58 PM He can stay home and follow his own program, remain in the same organization as his son, Mike 18 http://mike18boy.ifrance.com/ Posted by: mike 18 at June 6, 2006 5:39 AM Post a comment |
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