A C&G Challenge

[Camino LS6]

I've got plenty of ideas on this front, but I want to hear yours. How would you leverage, manage, adapt, modify, collect, or otherwise tweak GM's brand structures into a more workable state?

Don't give me lists of cars to add, or switch, or eliminate for each brand, instead describe the approach you would take and the framework of that approach.

[gm4life]

Focus the brands. Chevy simple have a affordable and stylish car line from small to large with Camaro/Vette and make Chevrolet trucks get better economy and stylish yet affordable. Pontiac focus on AFFORDABLE mainstream performance with differences in products from there Buick, Saturn and Chevy cousins. Buick AFFORDABLE luxury with Lexus-ish vehicles and style. Cadillac all out no excuses luxury with a full line-up of RWD cars and one traditional FWD "old fart car" and also keep the SRX and Escalade. Saturn vehicles with excellent fuel economy and styling with a unique euro flare think Opel. GMC keep building tough trucks and focus your line-up with vehicles that are true trucks. Saab keep bringing out affordable performance luxury products with AWD and turbo-chargers. Think more like Audi. Hummer keep building great off road vehicles including the H2 and H3 but give them both diesel and hybrid offering along with a more affordable H4 like a Wrangler. You see that wasn't that hard. Treat each brand seperate and focus in on what they build to minimize over-lap.

[Camino LS6]

I'm looking for a bit more here, think about how the brands can be an advantage rather than a liability.

Also, think of what drives you nuts about the way GM does things and how you might fix that in the process.

[Oracle of Delphi]

Just make me CEO of General Motors.

[Blake Noble]

I suppose I would start by doing a mild restructuring. I would create a new sales channel of Saturn-Buick-GMC so that there is a "step up" system in place at these dealerships that is absent with the current Pontiac-Buick-GMC sales channel. Buyers of Saturn cars could step up to Buick cars. Buyers of Saturn SUVs could step up to the Enclave or a GMC truck if they so desired. I would also create a sales division for what would be "niche" brands, which would be Pontiac-Saab-Hummer. Each brand within this sales division would only adhere to a strict brand mission and a low sales target. Chevrolet and Cadillac could be combined at a dealership or could stand alone separately.

I'll post more later.

[gm4life]

Sorry Camino its late.

[Croc]

I identify the following problems with GM:

1) Fragmentation of similarly-focused brands into competing sales channels.

2) Lack of brand focus

3) Lack of any umbrella leadership whatsoever resulting in fifedom mentality and management capitulation to dealer whining.

To remedy these points:

1) Restructure dealership sales channels into more product-focused, rather than price-focused, groupings.

---> a) Split Chevrolet into Chevrolet and Chevy Trucks. Chevrolet channels sell passenger cars and MPVs, Chevy Trucks sells trucks/SUVs. Chevrolet uses the global "Chevy" logo (chrome bowtie inscribed within a circle), while Chevy Trucks continues use of the chrome-outlined gold bowtie.

---> b) Sales channels will be clustered as follows:

Chevrolet/Saturn

Chevy Trucks/GMC[/HUMMER]

Pontiac/SAAB

Buick/Cadillac

---> c) By clustering similar product divisions, dealerships can capitalize on upselling to both their own and GM's benefit. For example, the Chevy Trucks/GMC/HUMMER dealership can upsell to higher-margin GMC/Denali vehicles without competing internally with Chevrolet. Uplevel Chevy Trucks and entry-level GMCs will be discontinued, so both brands can have some breathing room and cater toward the market perceptions of each brand. If HUMMER still exists, it should be positioned as offroad-ready, bare-bones SUVs made for offroading and getting mucked up. If a consumer wants a luxury SUV, they go to the GMC Denali model.

Likewise, Chevrolet and Saturn compliment each other well, as both brands are focused/perceived as mainstream vehicles. Both already share, or are slated to share, similarly-platformed vehicles, thus allowing the dealership to market/sell the vehicles similarly, but utilize Chevrolets for the price-conscious and Satrns for the more premium-minded buyers. As above, uplevel Chevrolets and entry-level Saturns are eliminated to reduce price overlap. A loaded Malibu should be priced similarly to a base AURA, which should be much more contented than currently available.

Pontiac and SAAB get paired up as both are perceived/have been focused as sporty. Both brands are sporty in very different ways, but Pontiac is still best remembered as "Driving Excitement" and SAAB is "Born from Jets." Pontiac should get RWD, while SAAB maintains FWD.

Buick and Cadillac should be paired together as they both represent luxury divisions. Cadillac should continue to focus on BMW, Mercedes, and Infiniti, while Buick should focus on Lexus, Acura and Lincoln.

2) Since dealerships are now grouped by product focus, GM will be free to make a luxury product decision without pitting B/P/GMC against Cadillac/HUMMER. GM can make a mainstream sedan decision without pitting Chevrolet against B/P/GMC and Saturn. This allows the dealerships and the overall GM umbrella of brands to pursue the same goals at the same time; trucks are handled by one sales channel, mainstream vehicles are handled by another, sporty vehicles are handled by yet another, and luxury by another.

---> BUT WAIT!! Doesn't Chevrolet make performance vehicles under the SS moniker? Well, maybe when talking about the Camaro or the Corvette, but let's be honest--a Malibu SS is assinine. This channelization will still allow Chevrolet to drop a large engine in a low-volume production run of any of its entry-level models and call it an SS. This would be very similar to the original muscle cars, these would be limited edition models not always in stock/production, and could be cycled on and off of production as necessary to build excitement for model lines as needed.

3) As far as platforms go, Chevrolet/Saturn should be FWD almost exclusively, with Camaro, Corvette and a smaller, premium cute-convertible like the SKY available in RWD. Pontiac and Cadillac should be exclusively RWD. Lower-priced, higher-volume Pontiac would help defray engineering costs for Cadillac RWD platforms, and occasionally the odd RWD platform could be made available to other divisions (like Zeta). Buick would primarily be FWD, with the odd premium RWD vehicle thrown in for good measure. SAAB would be exclusively FWD. GMC/Chevy Trucks[/HUMMER] would be on truck platforms. Duh.

4) GM leadership needs to grow a backbone. Make a decision and stick to it. Do not compromise on quality of execution because dealerships are clamoring for new product NOW. They always will. The difference is whether GM releases a halfbaked next-gen that, while a marginal improvement over the current product offering, they will be stuck with marketing for the next 5-6 years, or if they wait to release their products when they are truly exceptional (even if this means delaying releases a year) so they can sell an exceptional product long enough that its replacement comes BEFORE sales are in the toilet and dealerships are screaming about accelerating releases.

5) Each sales channel as outlined above will function internally as a division. Instead of 8 division leaders infighting over scarce development dollars, 4 will. 1 car guy, 1 truck guy, 1 luxury guy, and one sport-minded guy.

6) All sales channels will use the Saturn model: no-haggle pricing. I can't haggle at Best Buy over the price of a 72" plasma TV, so why should prices at a dealership be negotiable? Do I get a worse deal because the salesman is a Tau Kappa Epsilon and I'm a Theta Chi? C'mon...everyone pays the same price. Sales can happen, just like they do at Crate & Barrel, but price-haggling sucks, and if all of GM would abandon it, then it would have a real marketable advantage.

Those are my proposals. I'd love to hear some feedback, and maybe overnight I'll think of some additional ideas.

[Camino LS6]

Keep 'em coming.

[Satty]

Eliminating brands is probably inevitable. The unrealistic alternative for GM would be to make every brand a niche brands with only one or two models, save Chevy with maybe four or five and Cadillac with three to cover the highest ends of the market.

[HarleyEarl]

Honestly, one can't really offer up any suggestions here without the option of killing off brands....there is no way out.

It's the reality of the marketplace, otherwise it's just wishful thinking.

There is no point to Pontiac when Chevrolet can cover anything that Pontiac has to offer and more.

Don't get me wrong, I love the idea of Pontiac and it's history, but it has to go.

With so many foreign brands in North America, brands like Pontiac are doomed. It worked in another time. That time has come and gone.

Pontiac and Saturn have to go, and will. Possibly Buick and GMC as well.

GM could be very successful with just Chevrolet and Cadillac.

For me I'd like to see this:

Chevrolet/Chevrolet Trucks/Corvette - value, economy to high performance

Buick - Premium

Cadillac - Ultra Premium

No car company today needs more than three divisions. Two may even be the ideal.

Chevrolet & Buick in one dealership and Cadillac on it's own.

[Camino LS6]

Eliminating brands is probably inevitable. The unrealistic alternative for GM would be to make every brand a niche brands with only one or two models, save Chevy with maybe four or five and Cadillac with three to cover the highest ends of the market.

I disagree, but you've touched on what I've been thinking in a way. I take a more positive position on it, but I believe that cutting models (rather than brands) is part of the solution.

[Camino LS6]

Honestly, one can't really offer up any suggestions here without the option of killing off brands....there is no way out.

It's the reality of the marketplace, otherwise it's just wishful thinking.

There is no point to Pontiac when Chevrolet can cover anything that Pontiac has to offer and more.

Don't get me wrong, I love the idea of Pontiac and it's history, but it has to go.

With so many foreign brands in North America, brands like Pontiac are doomed. It worked in another time. That time has come and gone.

Pontiac and Saturn have to go, and will. Possibly Buick and GMC as well.

GM could be very successful with just Chevrolet and Cadillac.

For me I'd like to see this:

Chevrolet/Chevrolet Trucks/Corvette - value, economy to high performance

Buick - Premium

Cadillac - Ultra Premium

No car company today needs more than three divisions. Two may even be the ideal.

Chevrolet & Buick in one dealership and Cadillac on it's own.

On this I completely disagree.

[91z4me]

I can't haggle at Best Buy over the price of a 72" plasma TV, so why should prices at a dealership be negotiable?

I agree w/ everything except this. You certainly can haggle for a better price at Best Buy. They do it all the time on higher end items.

[Croc]

I agree w/ everything except this. You certainly can haggle for a better price at Best Buy. They do it all the time on higher end items.

Really? Usually the only time I can haggle a little is if I'm getting, say, all new kitchen appliances...and I am buying the dishwasher, stove, trash compactor and microwave, but they'll let me get an add-on or size upgrade for the refrigerator for less-than-MSRP.

At a dealership, this could translate to tire upgrades, dealer add-ons, etc. that are being bought "in bulk."

Fact is, most people, even when they haggle, still end up feeling like they've been screwed when buying a new car. The haggling is just downright unpleasant--and I'm an extremely good haggler. Got my ride in excellent condition for $7500 when they were wanting $10k initially.

[FUTURE_OF_GM]

First things first: GM needs to FOCUS the brands and utilize effective marketing Until they do that, nothing will make the company successful... Not good product, not high dollar leaders and not FORFEITING the market by cutting brands.

IF HUMMER IS SOLD:

First plan: Chevrolet continues as it is. Cadillac actually gets the product it needs to be taken seriously. Saturn and Saab join form one channel and are given marketing dollars to 'create a cohesive image'. Saab launches it's current 'future product' and is given ONE LAST CHANCE to show some sort of benefit from it's ownership. Pontiac is given viable product to be a 'good alternative to Chevrolet (Meaning a mix of performance and economy vehicles that ARE NOT DIRECT CLONES OF CHEVROLETS) GMC is paired down to a smaller line up. Make the Denali line, (Including the XT) the Acadia and the Terrain GMCs entire showroom. If you want to differentiate them from Chevrolet and take the division upmarket, then DO IT. There is no reason why a showroom of GMC Denalis can't make a profit for GM. The HX can morph into a GMC and be sold on the "Professional Grade Truck" image and probably open up a whole new market to the already successful division. The H3/H3T can become Chevies if it is needed. Buick sticks to it's plans.

So essentially, GMC and Pontiac are altered. The B/P/GMC channel can benefit from GMC lining up as a true mid-lux premium truck brand beside Buick. And if the market sinks far enough that Cadillac wants to bail on GMT900, GMC can take up the slack by continuing to move upmarket as the premium truck division at GM. (READ: this is a GRADUAL change unlike the Saturn "experience" that has confused the hell out of consumers) Then the B/P/GMC channel can also benefit from Pontiac being more of a volume player instead of niche performance models only. Sure, it'll continue to offer performance and better styling than Chevrolet, but it won't be a niche division. And there is absolutely NO reason why a company that still holds 20% of the market here cannot accomodate one and a half VOLUME divisions. Hyundai/Kia pulls it off without that much of the market and with LESS differentation.

Possible Dealer channels:

1) Chevrolet

2) Cadillac

3) Saturn/Saab

4) Buick/Pontiac/GMC

Second plan: Chevrolet continues as it is. Cadillac actually gets the product it needs to be taken seriously. Saturn and Saab join form one channel and are given marketing dollars to 'create a cohesive image'. Saab launches it's current 'future product' and is given ONE LAST CHANCE to show some sort of benefit from it's ownership. Pontiac is paired down to performance models ONLY and given a hot compact off of Delta II, something nice off of Kappa and/or Alpha and one of two Zetas, maybe a mini competitor. It is given a marketing budget to focus purely at enthusiasts and will have to completely rebuild it's image (partially) with very aggressive themes and products. This division ISN'T made for volume and that would be emphasized in the marketing. Buick continues as is and GMC reduces overlap with Chevrolet while expanding to include the "rugged" image of Hummer as the brand moves more premium in feel/image. Chevrolet already prices AND SELLS its trucks in lower GMC territory anyway. (Cadillac can market the more 'refined and luxurious' approach. Especially if the Escalade moves from GMT900)

In this plan, B/P/GMC becomes more specialized and focused (something that should've happened already) Chevrolet and Cadillac can be the BIG brands, but if you want something a little different and not so common, why not visit the B/P/GMC store. It would take creative and highly focused products going forward.

Possible dealer channels:

1) Chevrolet

2) Cadillac

3) Saturn/Saab

4) Buick/Pontiac/GMC

-or-

1) Chevrolet/Pontiac

2) Cadillac

3) Saturn/Saab

4) Buick/GMC

-or-

1) Chevrolet/Pontiac

2) Cadillac/Buick/GMC

3) Saturn/Saab

Third plan: Chevrolet continues as it is. Cadillac actually gets the product it needs to be taken seriously. Saturn and Saab join form one channel and are given marketing dollars to 'create a cohesive image'. Saab launches it's current 'future product' and is given ONE LAST CHANCE to show some sort of benefit from it's ownership. Pontiac is paired down to performance models only, GMC is paired down as well and Buick continues on the path to the future.

Possible dealer channels:

1) Chevrolet

2) Cadillac

3) Saturn/Saab

4) Pontiac/Buick/GMC

-or-

1) Chevrolet

2) Cadillac/Buick

3) Saturn/Saab

4) Pontiac/GMC (as niche boutique dealers that would be marketed as "as close to family owned as you can get" which would be a HUGE selling point in todays 'nostalgic' times)

-or-

1) Chevrolet

2) Cadillac/Pontiac (The Pontiac 'sports' clientele could eventually step up to Cadillac***)

3) Saturn/Saab

4) Buick/GMC

*** I've always believed that GM should operate as 3 entities to give the consumer 3 flavors. 1) The MASS market consumer can start at Chevrolet and step up to Buick/GMC 2) The ENTHUSIAST could start at Pontiac (what Pontiac is supposed to be) and step up to Cadillac (/Hummer) (This would keep it more exclusive than Buick and at the top of the heap, while NOT watering down the division) 3) The techie, euro fan could start at Saturn and step up to Saab.

Fourth plan: SELL SAAB and call it a day.

Possible dealer channels:

1) Chevrolet

2) Cadillac

3) Saturn

4) Pontiac/Buick/GMC

-or-

1) Chevrolet

2) Cadillac/Buick

3) Saturn

4) Pontiac/GMC

The bottom line is this: GM would be doing fine if they would just FOCUS the divisions and put the importance of SUBSTANCE/IMAGE/CONSUMERISM above the need to IMMEDIATELY turn a huge profit. the days of GM turning a HUGE profit are GONE for the forseeable future and they need to understand that. It's time to REBUILD (the brands have equity that has yet to be tapped) and until 'management' understands that simple concept, they'll be cutting divisions ever 3-4 years until they slit their own throats.

[HarleyEarl]

Saturn/Saab is not vialble.

[91z4me]

Saturn/Saab is not vialble.

Why not? Both are sold in Europe and do well there. SAAB:Saturn (Opel) would be equivalent to Buick:Chevrolet in the US.

[FUTURE_OF_GM]

Excellent ideas Croc.

I especially like this idea:

GM leadership needs to grow a backbone. Make a decision and stick to it. Do not compromise on quality of execution because dealerships are clamoring for new product NOW. They always will. The difference is whether GM releases a halfbaked next-gen that, while a marginal improvement over the current product offering, they will be stuck with marketing for the next 5-6 years, or if they wait to release their products when they are truly exceptional (even if this means delaying releases a year) so they can sell an exceptional product long enough that its replacement comes BEFORE sales are in the toilet and dealerships are screaming about accelerating releases.

[FUTURE_OF_GM]

Why not? Both are sold in Europe and do well there. SAAB:Saturn (Opel) would be equivalent to Buick:Chevrolet in the US.

Yessir...

It's a better match than Cadillac/Saab... Seriously? GM is trying to foist "true, flamboyant, american luxury" next to "weird, introverted, quirky" mid lux. www.notgonnahappen.com

And why can't the brands exist as niches? Mini does it just fine... Scion does it perfectly... Maybach, even at its price, doesn't seem to have a problem.

I look at it this way; GM is going to have to get innovative if it plans to retain the HUGE amount of equity and heritage it has. BUT once the market stabilizes, they'll be just fine.

This whole brand quagmire represents the managements inability to HAVE SOME VISION and STICK TO IT. Not 2 years ago, we were in this situation. A solution was proposed and all was thought to be well. But, instead of giving it some time (The system is ALREADY showing signs of working) they introduce 2 new products and LOSE FOCUS. It's this same schizophrenia with the platform, divisions, designs, etc that will destroy GM. As long as the dog keeps chasing its tail in an imaginary panic as opposed to hunting for food, it ill die.

IF, and that's a BIG IF pontiac has to go. I would support it becoming an HSV style, GMPD extension that hot-rodded and re faced ALL GM models.

Edited June 22, 2008 by FUTURE_OF_GM

[Oracle of Delphi]

IF, and that's a BIG IF pontiac has to go. I would support it becoming an HSV style, GMPD extension that hot-rodded and re faced ALL GM models.

Hey I heard that somewhere before! :AH-HA_wink:

[FUTURE_OF_GM]

Hey I heard that somewhere before! :AH-HA_wink:

Yep.

I'll give credit where it's due. The more I think about your idea, the more I like it.

[Camino LS6]

Thanks all, feel free to keep the ideas coming.

I'm going to try to find the time to do this topic justice as soon as I can.

[Croc]

As for Pontiac becoming the HSV of GMNA...well, that wouldn't be my first choice, but if that saves Pontiac from obliteration, then so be it.

[Camino LS6]

I hate to be a pest, but anything more?