Monday, April 6

Saving the company. What should GM do with its Brands and Sub-brands?

  • Is the problem with GM that they've screwed themselves over by giving up way too much to their unions over the years? Yes, partly I'm sure it is.
  • Is the problem with GM that they're costs are out of line with their selling prices, and consequently they just aren't making a dime on any car they produce? Yes, partly I'm sure it is.
  • Is the problem with GM mostly that GM has screwed up their brands? ABSOLUTELY.

Let's look at some of GM's North American brands, and take a shot at what they should mean: (it should be noted that they have several others serving the rest of the world)
  • Chevrolet - Affordable cars, whether you're a young person buying a first car, or a family buying a practical car.
  • Pontiac - Sporty fun, performance cars.
  • Cadillac - "You've made it." People will notice you've made it.
  • GMC - Trucks
  • Buick - Um... what does that stand for? I think it is supposed to come somewhere between the "affordable" and "you've made it" lines.
  • Hummer - "I'm an idiot" ... whoops I meant to say rough and tough upper class.
  • Saab - "You've made it ... and you have European taste". (Sounds a lot like Cadillac)
  • Saturn - Modern, affordable cars for young people or families. (Sounds a lot like Chevrolet)
Now, the interesting thing is that when you plug away at each of those brands there are glaring exceptions to how they have managed the sub-brands in each of those products. For instance, the Chevy line has something like 32 vehicles in it. It is like everytime someone from an Executive to a Janitor thought "Hey, what if we made a ...", they went ahead and made it. Think about the expense of designing, producing, and building each one of those models.

Does Chevy stand for an Aveo? It is a cheap "first" car. It would seem to me that Chevy does stand for that. What about a Cobalt? Yes again. A Malibu? Yes - that's a good affordable family car. How about the Cargo Van, Tahoe, Colorado, Silverado, Avalanche, Equinox, Traverse, and ... HHR (yuck). I can't imagine that Chevrolet really stands for any of those.

I'll pick on GM's SUV line-up for a moment. I feel bad doing this ... it is too easy.
Here's what GM makes for SUVs:
  • Chevy HHR ($19k+)
  • Saturn Vue ($23k+)
  • Chevy Equinox ($25k+)
  • Pontiac Torrent ($25k+)
  • Saturn VUE Hybrid ($28k+)
  • Chevy TrailBlazer ($29k+)
  • Saturn Outlook ($31k+)
  • GMC Envoy ($31k+)
  • Hummer H3T ($31k+)
  • Buick Enclave ($35k+)
  • Chevy Avalanche ($36k+)
  • GMC Envoy Denali ($37k+)
  • Chevy Tahoe ($37k+)
  • GMC Yukon ($38k+)
  • Cadillac SRX V6 ($41k+)
  • ... Etc. There are 34 of the damn things! Topping out with the Cadillac Escalade Hybrid at $74k+
Pickup trucks? 14 models across their brands.
Crossovers? 13 models.
Vans? 12 models (and you can't tell me that there is any significant difference between the Chevy Savana Passenger 2500 ($30k+) and the Chevy Express Passenger ($30k+)).

And they wonder why they're in trouble.

What should GM do? GM should tightly define each of their brands, and then slash and burn the sub-brands to ensure that the line-up of vehicles closely matches their master brand.

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