GM vice chairman says streamlining will save car maker
17 December 2008

GM vice chairman Bob Lutz has said that selling off sub-brands quickly is the way to push America's biggest car maker back from the brink of bankruptcy.

"Reducing the number of nameplates and putting your marketing money on the product is the way to go," Lutz told Automotive News, in an effort to talk up his floundering firm.

"It's really much better to have fewer brands, do it well and then market the hell out of them."

By streamlining its brands, GM can cut the cost of product development and marketing.

It will also stop sub brands - particularly in the US market - competing with each other and cannibalising sales.

GM has already put Hummer up for sale and the restructuring plan it put to Congress (which was subsequently thrown out) had Saab and Saturn 'under review' too.

"They [Saab and Saturn] are under still strategic review," said Lutz. "We realise they're not working, and something needs to be done."

"Nowadays, there's so much stuff out there and so many brands that nobody can keep track of it anymore," Lutz admitted.

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Comments
10

17 December 2008

The words stable, door and horse immediately spring to mind............

How much does this guy get paid for gods sake?

17 December 2008

SAAB was never a sub-brand, it had so much potential when GM took over! It's just took them so long to synergise the SAAB platforms with GM Europe. Launch the 9-4x and the new 9-5.....get the new 9-3 to market and then an SUV based on the next Zafira.

SAAB could make it and are the pioneers within GM for Biofuels and turbocharging....

Years of BAD BAD management has finally caught up with GMC and the US management should be embarrassed about how they have handled such a gem of a Swedish brand. There are very few unique brands out there....but SAAB was one of them.

17 December 2008

The problems here are at least twofold:

1. Hummer, Saab and Saturn are for sale? To who? I wouldn't give you a crisp fiver for all three. Just close them down and be done.

2. Lots of mentions of brand, none of product.

How do Ford and GM get it so right in Europe, by and large, and so wrong in the US?

17 December 2008

RobotBoogie makes a good point regarding Ford and GM making a general mess in the US, but hitting the nail on the head in Europe. I'm personally of the opinion that the big 3 should scrap their US products and just flood the US with the European brands instead! I agree that Saab isn't in the rudest of health, but when compared to some of the rubbish they sell over there it looks world class! It could solve their emissions issues in an instant too!

17 December 2008

I have been a regular traveler to the US for the last 11 years (brother lives there) and so I have seen first hand the state of the home produced cars. To be honest, they are shocking quality and even some of the higher priced models would only pass muster as low to mid range over here in the UK and most of Europe. Putting big ol' V8's in things does not make it better. The old saying "you can't polish a turd" springs to mind often when looking at the newest or updated models that are produced.

Another thing, a lot of the Japanese, Korean and European models that do sell are still Americanised with bigger capacity, and thus lower mpg capable and higher CO2 prodcucing, engines, cheap looking chromed alloys etc. Again, often spoiling the looks of an already acceptable car. Why do they need bigger engines? Experience indicates that they tend to drive slower than we do over here anyway. Sure, they may cover many more miles than we do traditionally but many of the lower capacity, cleaner and more fuel efficient engines are quite capable of handling the mileage.

17 December 2008

[quote RobotBoogie]

How do Ford and GM get it so right in Europe, by and large, and so wrong in the US?

[/quote]

I think that for the last decade the european arms of both companies have learnt the most important things to car buyers over here: Quality, Styling, Handling and Economy.

U.S. buyers have recently switched to our way of thinking and that has left the U.S. brands there in real trouble. Generations of (highly profitable) poor quality, under developed cars whose only saving grace is a great big V8 engine. Once buyers looked to downsize GM and Ford had no smaller, quality models to offer. So buyers switched to foreign brands.

Both GM and Ford have realised this and recently started selling their european cars over in the states but they left it way too late. The sub-prime recession just compounded this.

17 December 2008

Didn't Saturn just launch the Astra in the USA? Was it not also properly done; as opposed to when Ford launched a "Focus" that was shocking compared to the European one. It's still only available with the 1.8 petrol though - surely the 1.6 should be offered, 4mpg better and not much slower. One problem is the lack of cars over there available with a manual ("stick") - most have old school 4 speed autos, which then favours larger capacity engines.

17 December 2008

The Saturn Astra has flopped totally.

Historically, the European models of Ford and GM have failed when offered in the US market. It's not a new idea, they have been sporadically importing them since the 1970s.

18 December 2008

I think that's the issue- if they had have made a concerted effort rather than "sporadically importing them" then perhaps they could have become a sales success. With proper marketing and continued representation of the brand then it's less likely that they'll be forgotten about.

19 December 2008

I agree with Lutz, but never understood why GM left it so late. Pontiac, Saturn and SAAB could be sold together as entry-level/sporty, upscale/refined and premium/sporty if sold together and it will get rid of the direct overlap of Chevrolet, Buick, and Cadillac respectively in one hit.

The problem with keeping SAAB is that GM has decided that Cadillac should be the brand to compete with BMW. Had GM sold low-volume SAAB off earlier before the financial crisis to say Hyundai, which lacks a premium brand for its flagship products but increasingly has the expertise to build cars at least as sporty as SAAB's unfulfilled promise, then the 3 parties would have a win-win-win situation.

I doubt that they could be sold together now (unless some state-backed company from China decides they need credible brands for later foreign expansion). Should GM return to good health, I hope there's the possibility of Opel being reintroduced to fit in where Saturn (why did GM they bother trying to sell good European products with a cheap tarnished brand) left off and perhaps marketing could use any awards given to Opel to the US market's advantage.

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