GM (NYSE: GM) now has eight car brands. Since some models are built off similar platforms, a sedan from Saturn may not be much different from one sold by Chevy. The problem is GM may not be taking sales from Toyota (NYSE: TM). It may be taking sales from itself.
Last year, GM introduced three crossovers, according to The Wall Street Journal-- the Saturn Outlook and GMC Acadia, which are all but identical, and the more luxurious Buick Enclave. There are, of course, only a limited number of crossover buyers. Strong sales for the GMC crossover may hurt Buick.
GM thinks it can manage all of its brands but in a falling domestic car market there is little evidence to show that the company's plan will work.
It is time to kill some of GM's brands, save marketing money, and stop most of the competition among cars built by the same parent company. The firm's weakest brands by sales and falling units are Buick and Saturn. Most of their models are matched by cars in the Chevy, GMC, and Pontiac lines.
Shutting down brands is hard, an admission of defeat. But it is time for GM to let some of its model lines go.
Douglas A. McIntyre is an editor at 247wallst.com.
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Reader Comments (Page 6 of 6)
3-08-2008 @ 12:21PM
glen said...
I also have a 2000 chevy pickup and it has 10miles on it and it has 105,000 miles on it ,had to put new trans in it ,it also has a antifreeze leak,called gm told me it was a high mileage vechicle there was nothing they could do for me
3-10-2008 @ 3:26PM
gumby said...
Americans used to be loyal to GM and Ford no matter how ugly models look or run... Now it is a different story. Americans start to look for better models at Toyotas and Hondas... What is lef t of loyal GM and Ford buyers are still disappearing becasue they are upset with recent job buyouts of poor UAW stiffs.. Cobwebs are multiplying at dealer lots of GM and Fords now...
3-12-2008 @ 9:54AM
fabfiveathome said...
Branden,,,,,,,, you obviously are an imature young person that has alot of growing up to do. KMA.
3-12-2008 @ 9:39AM
fabfiveathome said...
It's sad how Americans are unloyal to our country. They complain about cheap jap, chia, korean products, but still buy. American cars are some of the best built cars out there. These foreign supporters are just stuck on crapaneese. Wake up America,,,,,,, see what you're doing to this country of ours,,,,,,,,,,, ya yours too. Remember that,,,,,,,,,, your country. Keep supporting the foreign market and see where we'll be in 10 yrs, and we'll have you to thank. You need to start being loyal to our Country.
3-13-2008 @ 1:29AM
Ashram said...
Yes!
The best thing GM can do to make its operations more efficient is to eliminate brands that are redundant and would cause market cannibalization.
Chevrolet is perfect as entry level for GM, so Saturn should be cut off as it's redundant.
GMC (Grabowski Motor Company, believe it or not) is perfect as GM's truck division, so all non-GMC truck models with possible exception of Cadillac's offerings should be eliminated. It's either that, or Chevrolet should assume the marketing of non-Cadillac GM trucks and the GMC brand should be cut off.
Buick is supposed to be in between Chevrolet and Cadillac in the GM hierarchy, but what's the point? Lexus, Audi, and other true luxury marques have entry level models as well as flagship models so Buick is a redundant brand that should be cut off.
Hummer and Pontiac are specialty brands and could be kept but, because they are specialty and are not the bread-and-butter of GM, they should be marketed as such, particularly Pontiac; Pontiac could be GM's Lamborghini, representing their performance offerings and marketed and managed as such. As for Hummer, perhaps they could be merged with GMC.
Ideally, GM's bread-n-butter would be Chevrolet and Cadillac with cross-platform sharing and model offerings kept to as much of a minimum as possible; you must keep it simple.
Specialty brands not marketed to the same segments as Chevrolet and Cadillac would be GMC, Hummer, and Pontiac.
3-13-2008 @ 1:28AM
Ashram said...
A huge irony of people accusing imported products is that it's not at all as simple as suggested.
When you buy a product from an American company, who do you know for certain that it is made in America? Many times, the "Made in USA" badge by itself is actually deceptive as the item may be merely assembled with parts outsourced from imports.
Or, here's a big paradox: is it more American to buy a Honda Accord that was made in East Liberty, Ohio or a Ford Fusion made in Hermosillo, Mexico?
When you buy that Honda Accord, your money went to American engineers (yes, Honda does employ a significant number of American engineers and designers who are responsible for many vehicles, including the Acura TL) and workers. So, even though your money went to the bottomline of a Japanese corporation, it also went into the salaries of Americans who worked for it.
When you buy the Ford Fusion, your money goes to American, European, and Japanese engineers who designed the platform that model was built on (remember, the Fusion is a platform that is also shared by Ford's European and Japanese marques) and it also goes to Mexican workers who built the car.
Here's another thing: electronics. There are many people who may still buy G.E. or RCA electronics without realizing that RCA today is owned by a French company, Thomson, while G.E. licenses its name to this same company for its consumer electronics. G.E. is still an American company, but it's product is only truly G.E. if it's a refrigerator, an x-ray machine, a jet engine, or a nuclear reactor and only one of these items are available to the average consumer. If you have a G.E. TV that was made in the late 1980s and up, it's from the French.
It's never as simple as many "Made in USA" apologists suggest as many American companies have become deeply immersed in global economics and are just as guilty at undermining American workers as everyone else; the only thing that's truly American in an American car is the brand that it bears. Either that, or some American companies that you remember are not, such as RCA, Zenith, and Quasar.
In some cases, even the workers themselves share some of the blame.
About the only American companies that are really doing great are those in aerospace, energy, IT, and computers: Boeing, Lockheed-Martin, Bell, Sikorsky, General Electric, Pratt and Whitney, IBM, Microsoft, Apple, SGI, Seagate, Dell, Hewlett-Packard, Motorola, Intel, AMD, Micron, Sun Microsystems, and many others. But, they are all immersed in the mechanics of the global economy and all have done their share of outsourcing to reduce overhead and maximize profits at the expense of American jobs.
And, what do you do? Boycott them? How? By not buying them? And, what would they do? They may outsource even more to further reduce their overhead.
More than likely, though, the immediate need for their products and services outstrips the demand to keep jobs here as that requires a consistent and prolonged campaign along with a clear message on WHY the boycott has occurred.
Think that would happen?
3-13-2008 @ 3:06AM
Rick White said...
I have to agree Chris Carey. I wouldn't count GM out, yet. Yes they have made some mistakes. When GM decided to kill Oldsmobile, the division was still doing 250k plus units a year. At the time I remember the "experts" saying most Oldsmobile customers would most likely buy another GM brand. The opposite happened--most of those customers left for other non GM brands. Even today many imports brands would love to be selling 250k units in the US market.
In the 60's and even into the 70's GM was the master of using the same platforms to create many different and fairly distinct looking models. The X body (Nova/Ventura/Omega/Apollo/Seville) in the mid 70's covered all five GM brands. GM sold tons and made money on everyone especially the Cadillac Seville. GM's problems began when they started making their cars too similiar.
GM should look at their profitable past when planning their future. Also don't over look the potential of the Volt and $1 a gallon ethanol from Coskata.
4-14-2008 @ 7:48PM
Scp024 said...
GM makes the best cars. I wouldn't own anything else. Never had a problem in 35 years of car buying. We should all be buying American and save this country, instead people go to the cheap foreign cars and now our economy is going down the drain fast.