Wednesday, March 16, 2005
The General's Dying Breath?
But, needless to say, today's announcement that GM would post a first-quarter loss and downgrade earnings potential certainly shocked the investment community like a cattle prod to their collective ass, driving down stock prices by 14%. This made fools out of those who figured that GM's bad karma was already figured into a stock price that was forty-some percent off its 52-week high. Never doubt Wall Street's ability to accommodate additional bad news.
According to the report I heard on NBC Nightly News this evening, GM was going to address the situation by placing less emphasis on incentives, and more on "aggressive advertising". Fine and dandy, if there's anything deserving of such "aggressiveness", and if traditional advertising still works to move vehicles. I think it's generally ineffective compared to street buzz, and that's been running decidedly negative against GM ever since they picked up the reputation for killing off any niche vehicle that was remotely interesting.
So what to do? Anyone can sit and bitch about those hapless fuckers in Detroit - perhaps it's time to give them some suggestions that they'll disregard anyways, because short of supplying them with a sufficiently large crowbar and a case of 5W30 to assist in the reversal their rectal-cranial inversion, not much is going to help. And besides, the bond traders will show up with the crowbars anyways, albeit without the lube.
First, let's start with the assumption that we're not going to kill off any brands. It's what needs to be done, but I don't think that GM wishes to absorb the costs of pulling another Oldmobile any time soon.
With that in mind, Saturn needs the best small car they can get. Either bring the ION up to the standard of the Cobalt, or simply reskin the 'bolt and get it into Saturn dealers ASAP. Better yet - absolutely kill off Saturn's dull-and-drab sales image once and for all with some unique and interesting product. I thought Scion was going to bomb, and it didn't, so maybe that's the direction to take Saturn. Maybe give them an exclusive wagon version of the Delta. Let the HHR do its weird little thing with a Saturn badge on the grille. Either ax the Relay minivan or turn it into a VW minibus-like oddity.
Pontiac wants to be considered as an "American BMW", in Lutz's words. Forget that - let Cadillac handle that role. Instead, strive to steal sales away from the dying VW. Hire some honest-to-goodness German designers who can somehow turn a jellybean profile into something bohemian. Forget this "excitement division" crap - the only exciting thing in the lineup is the GTO - and concentrate more on those stupid little touches that look really great in meaningless ads that are targeted towards college grads that are well on their way towards becoming hollow thirtysomethings (I'm thinking of one VW ad in particular that focused on the turn signal lamp, as if that perfectly polished reflector, clear lens, and orange bulb was the modern equivalent of Da Vinchi's work). And one last very important thing - offer a diesel in the G6 and Grand Prix, along with a proper manual transmission and AWD. Do this, and some relatively small number of weirdos will beat down your door. For the rest of the vehicles that still burn gasoline, one simple rule should apply - no more pushrods. I'd feel differently if GM would execute a pushrod V6 as well as it does the GenIII/IV engines, but they're not doing that. So make it clear - if someone wants a "high value" engine, tell them to hit the Chevy dealership. There will be only premium engines here.
Common to Pontiac and Saturn are the Kappa roadsters. I've stated what I don't like in previous posts. All of that would be erased with a small V8 under the hood. This is the American way to build such a car, and if someone doesn't like that fact, they are welcome to get on the next boat to France and spend the rest of their lives fawning over the virtues of Citreon's air suspension. Goddammit, we're supposed to be the world's sole remaining superpower and we're stuck trying to build a pudgey roadster with a fuckin' inline-4. That sort of attitude during WWII would have had us speaking Japanese or German by now (which I'm not sure). Grow some balls, put a smallblock underneath the hood and create the next cult car, because I guaran-fucking-tee that middle-aged men don't get boners over classic ponycars by thinking about base-model engines. I swear, any man who thinks that 170 HP is sufficient for a 2900 lb car probably needs to be slapped hard enough to dislodge the cock from their mouth that is currently occupying the majority of their attention. The last time that sort of power-to-weight ratio was acceptable, it was still cool to wear pastel T-shirts under sportcoats.
Buick - I don't fucking know what to do with them, nor do I care much right now. Even if GM dumped every dime they had into the three-crest divsion, it wouldn't be enough to save their bacon. So let's ignore them for now. OK, that's not fair - let's give them something along the lines of the T-Types and Grand Nationals of the 1980s - maybe their own version of the GTO with a wicked supercharged 3800, since that engine is tragically underutilized in GM's FWD product due to their use of a 20-year-old transaxle. 350 HP seems like a nice number to shoot for from the factory (leverage Holden's relationship with Calloway if necessary), and let the aftermarket go nuts. This could be an instant cult car along the lines of the Toyota Supra.
GMC - Yikes. Over the past 15 years, pretty much since the days of the "merger" of their Class 8 busines with White and the eventual sell-off to Volvo, this division has been meandering along the verge of meaningless. Yet, there's still some folks out there that remember what the GMC nameplate used to mean, and those people specifically walked into that dealership because a big General, Brigidier, or cabover Astro sitting on the same lot gave their "little truck" instant credibility. How to restore that? Hmm. Probably ain't gonna happen, at least not easily. The first step might be to given GMC the exclusive rights to commercial vehicles (cab-chassis models, vans, etc.). Next, no more crap like the Envoy whatchamacallit with the retractable roof. If there's going to be something special, how about a one-ton-plus model that trumps Dodge and Ford without getting as ridiculous as the International SXT? Next, GMC needs truly distinctive sheetmetal. Right now, they have different parts than the comparible Chevy models, but the subtle differences are enough to make one ask "Why bother?". So as long as seperate tooling is being make, stir things up. Something needs to be done here, since GMC is current GM's second-biggest brand from a sales perspective.
Chevy - Build a full-size RWD sedan. Sell it in a variety of trim packages, from "I can't believe that geezer made it into the showroom without a walker" to "anything shy of a Nextel Cup car will look pussified in comparision". Price it right. Use it to replace the Impala, and let Ford mop up the wuss FWD sedan market with their Five Hundred (which, uh, is going to happen anyways). Bonus points for building a full-size wagon with a 3rd-row seat of marginal usefulness. Redesign the Malibu to look more like something - anything - from the Sixties. Rush the SS version into production with a ballsy motor, AWD, and a manual transmission (same for the Maxx wagon). Fix the trucks. Offer a diesel in the Colorado, and figure out a solution for the half-ton trucks and SUVs immediately - it'll pay off when the gas crunch comes.
Cadillac - keep doing what you're doing, and hope it continues to rake in enough cash to fund other operations in the short term. Don't get lazy and sit on things for too long - maintain a consistant 4- or 5-year model cycle, with updates inbetween.
So, there it is. A list of perfectly fine suggestions, none of which will happen except by pure accident. We're probably not too far from the point where we accept that it's the end and start reflecting on the good times, but maybe things will turn around yet. After all, for all the inertia in the auto industry, fortunes change in the blink of an eye, and often for unexpected reasons. Perhaps the GMT900 trucks are a smash hit, or maybe the new stuff from the past two years decides to take the slow-but-steady growth path.
But if I were GM, I'd be taking a good hard look at every single product that's out there, and figuring how to maximize return on what little cash they have left. Incentives may have worked in the short term, but that $12B/year ($3K average spread over 4 million units/year - a rough guess) might have been better spent in product development, and it's time for that sort of thought process to dominate in Detroit.