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Thursday, May 19, 2005

The Man with the Plan



This is very big news. The Detroit News is reporting what GM's future focus will be, specifically the plan to get them out of the spot they're in at the moment. It's a plan that sounds good and it's unfortunate that it didn't come sooner. So much of GM's problems stem from disorganization of models, something I and many other pundits have been complaining about for years.

Mark LaNeve, the VP of sales, is spot on when he says that the company doesn't have too many brands. What they have is too many overlaps. Here's what I got from the article on some of the basic moves they'll be making in the next few years:

1. Chevrolet and premium Cadillac will be the two bookend brands, with each offering a broad product lineup.

So long as Cadillac isn't TOO broad of a lineup, I think this is a good idea. It's true that both of these are the best selling and most well known brands of GM. However, this is pretty much status quo, since Cadillac and Chevrolet are already offering a broad lineup.

2. Buick, Pontiac, GMC, Saturn, Hummer and Saab will exist as "focus brands" with more limited portfolios.

The biggest change here is to Pontiac and Buick. Obviously Hummer and Saab are niche brands. Hummer will never offer a car. This might mean that Saab's SUV will only last one generation. It seems to me that when they came up with this plan, Saab wasn't really thought of. What does this mean? Perhaps Saab's future is a short one. For Buick and Pontiac, the article guesses this later on, it means the end of SUVs and minivans for those marques. That's a good idea, but I think GM should offer at least one upscale minivan to compete with Chrysler. Pontiac and Saturn should never sell minivans.

3. GM is repositioning Saturn as a more upscale brand below Buick, leaving behind its past as a purveyor of plastic-clad compact cars.

Saturn needs a repositioning, and a recognition that the people who buy its products are not normal GM buyers. They buy Japanese and Volkswagen. If Saturn can be seen as an alternative to Volkswagen, i.e. high quality small cars, then it will do well. VW has dominated that market sector for years without competition.

It can all fail if GM does not restyle their offerings aggresively. They've already proven they can make a high quality vehicle, as shown with their high ratings from JD Powers, but what they need to show is that they can make an aesthetically pleasing vehicle. Organization will help matters, but good looking cars will do even better. If LaNeve pulls this off, he might be the next in line to run the company.

Comments:
Hi ,
Im an advertising guy(suit) here in Dubai and am working on an automotive brand.

Would be great to get your opinion on a few things around consumer preferences on cars and of course the fresh perspectives that you would bring on...

Lemme know wether we could have a chat one of these days ...

cheers
jassim
 
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