How do you destroy GM?

[FUTURE_OF_GM]

Most Americans will not buy from bankrupt automaker-survey DETROIT, Dec 28 (Reuters) Almost three of every four American consumers polled would not buy a car from a manufacturer that had declared bankruptcy, according to arecent survey, giving struggling U.S. automaker General MotorsCorp. <GM.N> something else to think about. Seventy-four percent of respondents said they would not purchase or lease a new car from a bankrupt automaker, according to a survey released by Cincinnati-based research firm Directions Research Inc. Twenty-six percent said they would buy from a manufacturer in that position. GM executives have denied speculation they would seek Chapter 11 protection in bankruptcy court. It has lost nearly $4 billion this year amid high health-care and material costs, shrinking U.S. market share and declining sales of lucrative sport utility vehicles. The world's largest automaker said last month it would cut 30,000 North American manufacturing jobs and close a dozen plants as part of its plan to cut costs by $7 billion. The survey indicates consumers would look at a bankrupt automaker very differently from a bankrupt airline. UAL Corp.<UALAQ.OB>, Northwest Airlines Corp. <NWACQ.PK> and Delta AirLines Inc. <DALRQ.PK> sport passenger levels similar to those before they filed for bankruptcy. Other findings in the Directions Research survey releasedon Friday: 72 percent of respondents said they would not consider buying a vehicle from a Chinese automaker, while 85 percent felt the same about an Indian manufacturer. Industry observers have said it is only a matter of time until a Chinese-made vehicle is sold in the United States. Whether such a car would be sold by a Chinese manufacturer under their own brand or by an established automaker with plants in China is still to be determined. Energy prices remain a concern for consumers as well as 62 percent of respondents said high gas prices had influenced the amount of driving they do. Thirty-nine percent of consumers said gas prices would be a primary factor the next time they are in the market to buy a new vehicle, while 48 percent said it would be a secondary factor. Thirteen percent said gasoline prices would have no influence on their decision. Directions Research polled 1,063 adults during the three weeks that ended Dec. 14 and the survey has a margin of error of plus or minus 3 percentage points. The poll was not conducted for any client. ((Reporting by Ben Klayman, editing by Maureen Bavdek; ReutersMessaging: [email protected]; 312-408-8787;[email protected]))REUTERS ***GM: damned if they do and damned if they don't, as usual***

[the_yellow_dart]

Well, the brass seems convinced that this is not necessary, so maybe this is some extra motivation.

[Petra]

Are you really surprised that 75% of those polled would not buy a car from a bankrupt company? I'm not. I can't think of a single company that has had sales maintain at a steady pace while undergoing a major crisis, let alone bankruptcy. Buyers can smell a dying company, and it scares them.

[the_yellow_dart]

Petra - it says right in the article that people continue to buy from bankrupt airlines.

[enzl]

Petra - it says right in the article that people continue to buy from bankrupt airlines.

[post="64769"]<{POST_SNAPBACK}>[/post]

Be careful not to deride the delicate genius! He'll take his ball and go home.


Interesting note: 75% of respondents said they wouldn't but a car from a bankrupt company. GM's market share this year will be about 25%, no?

Airlines are different, in the sense that you don't hold plane tickets for 5 years into the future. Also, I think the modern traveler has become immune to the disaster that is the modern Airline business.

[CSpec]

Airlines are different, in the sense that you don't hold plane tickets for 5 years into the future. Also, I think the modern traveler has become immune to the disaster that is the modern Airline business.

[post="64782"]<{POST_SNAPBACK}>[/post]

Yeah as long as the airline is still flying it will get you from one city to another; you don't need long term service or good residual value.

[thegriffon]

Airline passengers also expect that they probably won't be left stranded if their carrier stops flying. There's always plenty of extra capacity and someone else may honor their ticket out of goodwill. Even closing a brand would worry potential GM buyers. Even if they're away of the relationship they may not like the idea (for different reasons) of being forced to take their Pontiac or Buick to a Chevrolet or Cadillac dealer if it needs service.

[Flybrian]

Be careful not to deride the delicate genius! He'll take his ball and go home.

[post="64782"]<{POST_SNAPBACK}>[/post]

Such unwarranted personal attacks aren't necessary.

[razoredge]

I dont fly but it seems to me people would be worried about the maintainence of equipment. Just on the news infact.....thats funny.....Independant air might be done ? Whoever that is. THats the kind of stuff Id be worried about. stupid cut throat capitolistic ideals...... its not like any would go without work if they all charged necessary rates.....it is after all a business.....lets get professional people ! Lets wake up America....this is not a test run.....its the real deal :( I have always figured bankruptcy would kill a company. I also figured killing Olds would send out bad signals and I figure all the buzz about GM loosing money and stock value would hurt sales. It's like one big snowball on a hill in fresh wet snow, its going to be really hard to stop.

[Petra]

Petra - it says right in the article that people continue to buy from bankrupt airlines.

[post="64769"]<{POST_SNAPBACK}>[/post]

Proved me wrong. But consider some of the airlines that are in bankruptcy right now: United Airlines. Northwest Airlines. Delta. They're some of the biggest airlines in operation, are they not? When that many big airlines go down, who is left to pick up the slack? I'd say that people are still buying tickets from these airlines simply because there is no alternative. The automotive industry is different... If GM were to go bankrupt right now, there are at least a dozen other automakers poised to pick up GM's lost sales. If GM, Toyota and Ford all went into bankruptcy at once, people would still keep buying their cars, because there simply isn't much of an alternative.

[FUTURE_OF_GM]

Interesting note: 75% of respondents said they wouldn't but a car from a bankrupt company. GM's market share this year will be about 25%, no?

You know, I thought about that after I posted this.

But of that 25% how many share the sentiments of the 75% in the survey?

[enzl]

You know, I thought about that after I posted this.

But of that 25% how many share the sentiments of the 75% in the survey?

[post="65209"]<{POST_SNAPBACK}>[/post]

Well, if its 75%, you're talking about a 6-7% market share following a bankruptcy!

I think automobiles are such a unique animal: they combine personal statement with safety, performance, utility, etc...I think the average consumer might not only be turned off by an automaker in bankruptcy (I'm old enough to vaguely remember what people said about Chrysler before the gov't bailout), they might go so far as to avoid the products (regardless of merit) automatically.

GM, as a PR move alone, has to avoid this at all costs (and I think you're seeing that in action with the Delphi assistance and the softer tone regarding the Union in the past few months.)