What’s happening at America’s largest car maker—General Motors? With its North American market share slipping and recent lackluster new model launches, what prompted GM to spring into action and finally take charge of their sagging North American operations?
In a word–revolution. And Rick Wagoner is waving the banner of a new General Motors. After the devastating effects of September 11th, GM initiated a war of its own–an incentive offensive against all of its North American rivals. The 0% financing incentive push has pinned down a fragile Ford and a decimated DaimlerChrysler into a game of “catch-up.” With Japanese and Korean OEMs gaining ground in GM’s home market, the company has decided to grab market share while Ford and DaimlerChrysler experience severe financial difficulties.
In addition, the recent hiring of Bob Lutz as “product development czar” was a major coup. Armed with a mandate to revamp GM’s tepid product lineup, Lutz is methodically reviewing GM’s new generation vehicles and is determined to reshape and recast these new vehicle platforms, a skill he honed to perfection at Chrysler Corporation. Unfortunately, the full effect of this effort won’t be felt until 2005/2006 at the earliest.
General Motor’s infatuation with brand marketing also has taken a hit. With the departure of Ron Zarella, GM’s strategy of marketing vehicles like Procter & Gamble markets Pampers diapers has failed. The current brand management structure will be altered to focus on providing designs that distinct consumer groups want. Expect more brand management hiring recruitment from Ford, DaimlerChrysler and European vehicle manufacturers, less from Whirlpool, Procter & Gamble and Bausch & Lomb.
For the past 20 years, GM has been obsessed with the European design expertise within its Opel operations. After numerous North American design failures (can you say Catera?), the company finally realizes that Opel isn’t a premium European design studio like Bertone, Pininnfarina, et al. North American consumer’s tastes differ greatly from that of European consumers. GM is expected to continue to aggressive recruitment of top European and American vehicle designers.
With numerous initiatives underway at GM, what can we expect out of the new GM? Providata Automotive offers the following projected market developments for General Motors: