Lately, the jackals have been circling General Motors. Even in the boardroom, restless shareholders are pressuring to bring in new leadership or take dramatic action to stave off bankruptcy. How did a venerable American institution get to this point?
There are lots of explanations going around — healthcare costs, high labor rates and burgeoning pension obligations have all been blamed. No doubt these are major factors that are hurting the General’s bottom line, but I think the biggest failure is one of marketing. GM is simply not building enough desirable vehicles.
There are certainly pockets of strength within GM’s product lineup — think Corvette, Cadillac and some of its trucks and SUV’s. The problem here is that high gas prices are turning many consumers away from these thirsty vehicles. When buyers look for cars and not trucks, the General comes up short in comparison to offerings from Toyota, Honda and other manufacturers.
It’s funny how brand loyalty can last a lifetime. Most of my early vehicles were Chevrolets including a 1951 sedan (it was older than I was), a 1966 Impala convertible, a 1976 Vega (the worst car I ever owned), and a 1980 Monte Carlo. I still feel a connection to the brand but I don’t know which model I would buy today. The only option I would consider is a Cobalt for my teenaged daughter. For myself, there just isn’t a Chevrolet I would want to own right now. I don’t claim to represent the majority of American car buyers but apparently many of them feel like I do.
There are some hopeful signs. The new Buick Lucerne looks great, at least on the outside. I don’t think I’m old enough for a Buick but hey, you never know. The Pontiac Vibe is an efficient little package that looks like fun. The Cadillac CTS would be a big hit with my son. Beyond that, there’s not a lot that appeals to me.
In the short-term, someone will probably come in and cut costs to save the company from insolvency. The real challenge, though, is to cut through the brand clutter and create distinctive models and identities. Some of GM’s nameplates may have to go in the process. Can the company succeed? Well, they certainly have designed some great autos in the past. Think about the 1957 Chevrolet Belair and the 1963 Buick Riviera. These cars are classics that have stood the test of time (at least in terms of design).
It’s up to the designers and marketers to create new classics that will attract a new generation of buyers. As a loyal but lapsed Chevy customer, I’m hoping they can do it.
