'GM's Collapsing Ladder'

[HarleyEarl]

GM's Collapsing Ladder By Eugene Robinson Friday, November 25, 2005 It's sad to watch General Motors fall apart like a rusty old Malibu, and not just because so many workers are losing their jobs. When I was growing up in the '60s, GM was more than just an icon of American capitalism, more than just the company that made and sold half the nation's automobiles. General Motors gave me my first schematic diagram of the American dream. These days we'd call the GM strategy an exercise in market segmentation, but back then I would have called it "moving on up." With its five distinct lines of passenger cars, GM created a climbable staircase of price, power and prestige. In the process, the company not only made tons of money but also helped cement a deep-seated belief that to this day is held by almost every citizen of this great nation: You are what you drive. Who's Blogging? Read what bloggers are saying about this article. True Blue Liberal Full List of Blogs (1 links) » Most Blogged About Articles On washingtonpost.com | On the web A Chevrolet (with one big exception) was basic transportation. Driving a big, wallowing Chevy Impala meant that you had enough money to buy a car -- no small thing, mind you -- but not enough money to be frivolous about it. A Chevy was a stolid, boring, no-nonsense way to get around. The exception, of course, was the Corvette. My friends and I spent a lot more time imagining ourselves taking slalom runs in sleek, shiny Corvettes than on minor matters such as school, family or church -- and almost as much time as we spent thinking about sex, which we were pretty sure required a Corvette for consummation. The next step up was Pontiac. A big, wallowing Bonneville was basically an Impala with an angry-looking grille, but there was a difference: The Pontiac was "sporty" in a way the Chevy couldn't possibly be. When the muscle-car era dawned, that image of cool was made indelible by the incomparable GTO, which wasn't as sexy as a Corvette but at least allowed you to imagine cruising with your friends. After Pontiac, you could move up to Buick. The LeSabre was, yes, big and wallowing, and mechanically it wasn't much different from its less-expensive siblings, but there was an air of solid, middle-class accomplishment about a Buick. We were a Buick family -- we had a black 1964 LeSabre. The pastor at our church, Rev. Curry, had an identical car, which he let his son Jimmy drive. Like a lot of preachers' kids, Jimmy couldn't have been more polite and respectable in the presence of adults, or more mischievous the rest of the time. Once, before I got my license, Jimmy was giving me a ride somewhere and decided to see how fast he could take a curve. The tires squealed, we missed a telephone pole by inches, and any urge I might have felt to take our LeSabre through any slalom runs was immediately quashed. By the mid-'60s, Buick was being overtaken by Oldsmobile, which represented near-luxury and advanced technology. Remember the 1966 Toronado, with the shocking innovation of front-wheel drive? And retractable headlights? Neat, but James Bond's Aston Martin was better. Finally, at the summit, there was Cadillac. Driving a Cadillac meant not only that you had arrived but also that you wanted everyone to know how well you were doing. Or else that was just what you wanted everyone to think. Yes, eventually a slightly disreputable "Superfly" odor began to waft from big Caddies, but that could be avoided by forgoing most of the bling -- no super-wide whitewalls, no diamond-in-the-back vinyl top. A big Cadillac meant that you, too, were big. Now, as it sheds high-wage assembly jobs -- at least 30,000 will disappear by 2008, the company announced this week -- and hemorrhages money on health and pension benefits for retirees, GM is much diminished. Oldsmobile, the oldest of the lines, is no longer made; Buick and Pontiac are fading fast. The ladder isn't a ladder anymore, because it's missing the middle rungs. GM's core business is inexorably being reduced to Chevys and Saturns at the bottom of the market, and Cadillacs and Hummers (and Corvettes) at the top. That's becoming a common pattern in the automotive industry. Companies let you buy a Nissan at the bottom of the market or an Infiniti at the top; a Toyota or a Lexus; a Honda or an Acura; a Volkswagen or an Audi. And it reflects the new reality of this country, or at least the new way we're coming to see ourselves. Either you've made it or you haven't. Either you're a champ or a chump. You can still buy an Impala and "See the USA in your Chevrolet," but the view has changed.

[aaaantoine]

Wow. That's a pretty good, thought-provoking article. His comparison of the old hierarchy to the modern Economy / Luxury model is indicative of the slow fading middle-class.

[Drew Dowdell]

Part of the problem is also GM's fault. Back in the 50s and 60s the divisions had a smaller number of models, but more variations in each model. In the 80s the divisions started having one of everything with very little variation in the model line. In the 80s every division got a J-body. Every division got an A-body <except Cadillac>. Every division got a W-body. Every division got an H-body <execpt Chevy>. Every division got B-body. It brought the divisions down on top of each other. Why buy a 98 when for a few bucks more <or even less in some years> you could get an even more posh Park Ave/Electra? Why spend all that dough on a Park Ave, when for just a few dollar more car payment you could get a Deville? The ladder isn't collapsing today. It collapsed somewhere around 1981. GM is trying to rebuild it today. The ladder looks different now. Instead of the rungs being social class or financial indicators, they are more personality indicators in picking which kind of car you want. Today the ladder looks more like this: Sport/Lux - Cadillac Lux - Buick Sport - Pontiac "Euro" - Saab/Saturn Basic Transport - Chevy

[balthazar]

The ladder collapsed long before '81; I would say in the late '60s in many instances. That's when pricing overlaps began in earnest. The article tho, is ridiculous... a cornicopia of stereotypes. Optional super-wide whitewalls- Cadillac has never offered different width whitewalls on any given model. Yeah- it's a generalization, but if a 'journalist' is going to address a specific problem, he must detail it with facts not wild imagination. His impressions were cemented as a kid only interested in the 'vette, not as a car guy who knew/knows what he's talking about. No one who knows from experience or research would ever claim a Bonneville is basically an Impala anymore than it is basically a Galaxie. Armchair idiot.

[wildcat]

What kind of revisionist history is this? Buick has always been junior only to Cadillac. GM's hierarchy was, in order, Chevrolet, Pontiac, Oldsmobile, Buick, and Cadillac. Mr. Robinson, Buick wasn't overtaken by Oldsmobile in the mid-'60s - both were fine; Buick had, to name a few, Riviera, Electra 225, Wildcat, LeSabre, and Skylark. In fact, to me, the mid-'60s were Buick's stylistic height!

< where's a smilie face with a tongue sticking straight out when you need it? > Edited November 26, 2005 by wildcat

[Newbiewar]

is it time to find Saturns place? I recently was thinking that GM replaced Olds with Saturn... both were designed to be a mediocur volume brand with its own personality... but where in the Ladder would Saturn fit? I mean Chevrolet, Saturn, Pontiac, Buick, Cadillac? but each brand has its own uniquness to it, so how can you put it in a ladder... when Chevrolet is value, Pontiac is supposed to be, but today is clearly not performance and excitment Buick is comfort and not today but style Cadillac is... well Cadillac, ulta luxurious... Saturn is supposed to be what? a different kind of car company? but where is it supposed to be going? what kind of car company, A peice of mind slogan doesnt really set Saturn a straight line in the road? Oldsmobile was what? Technology with great value, being the hand me down between buick and cadillac in a volume brand? exactly how does the ladder stand up and where is each company supposed to be going, and has GM forgoten what eachbrand means? and do saab Hummer or GMC fit into this sceme of things? what exactly am I to tell customers the difference is between GMC and Chevrolet? I usually end up saying price, but doesnt that make me look like a fool? shouldnt there be more then just a second try brand to GMC? Hummer has its obvious millitary ties, and saab is clearly not in to the GM way of things YET... SOrry if I just hijacked the thread... Edited November 26, 2005 by Newbiewar

[nightwave]

For me, I can see several different ladders leading to one direction. (I am going to generalize. It may not be correct, but it'll help me get my point across) You've got Chevy and Saturn at the bottom, with "Baseball, apple pie, and Chevrolet," and "Soccer practice, Starbucks, and Saturn." Both provide basic transportation at an affordable price; Saturn for people who have an image to consider :rolleyes:, and a Chevrolet for someone who wants something reliable and American. Then, if you want to take a step up from Chevy, there's Pontiac for the people who prefer performance. For those who prefer bells and whistles, there's Buick. If you're a truck kinda person, you've got GMC. Saturn, being a more Euro kinda brand, leads into Saab. If you prefer trucks, you've got an additional rung with Hummer. Hummer acts as the "Cadillac of trucks," for those who've got money and want to show it. At the top of the ladder, you've got Cadillac. This is the brand to get when you've "arrived."

[CARBIZ]

I am a car buff who grew up in the 1960s, yet I am unsure what the difference between Buick and Oldsmobile was at the time. And things got worse. I think what Eugene is gettng at is that Oldsmobile began to outsell Buick. Remember, that by the mid-80s, Oldsmobile even outsold Ford and was second only to Chevrolet. Regardless of the author's facts, the point is well taken that GM has way too many brands and models for a mid-20s market share. Something has to give. We can argue about whether it should be Buick or Pontiac or Saturn, but something has to go. Case in point, our market is being flooded with Torrent commercials. The Equinox was selling well, so GM has moved on. Other than pitting Pontiac dealers against Chevy dealers, I see no point to this. It is the same f**kng vehicle! It would make a helluva lot more sense to invest all those development dollars (to fix the deficiencies of the Equinox) and advertising dollars on one vehicle - to do it right. Stop spreading everything so thin!

[ehaase]

I oppose eliminating any divisions. I support eliminating the overlap between Buick and Pontiac, which GM is already doing. Mostly the Wall Street and CNBC crowd, who wants GM to declare Chapter 11, eliminate the pension plan, slash the health care plan, and push the UAW out of business, is pushing for GM to cut brands.