AUTOMOBILE WEEK: G.M. (Part 2)
John DeLorean's Pontiac G.T.O
A Real "Corvette"General Motors was once an amazing company. At one time the company (founded in 1908) consisted of Cadillac, Chevrolet, Oldsmobile, Pontiac and Buick. Today, you can add Saab, Hummer, G.M. Trucks and Saturn, but cross Oldsmobile off "The List" (and possibly Pontiac, Buick and Saturn; Hummer has been put up for sale and is expected to fetch less than $1 billion to Mahindra & Mahindra Corporation. A combination of sad and stupid. I hate to be so blunt but consider the following.
_
The G.M. I remember showed us what a real Corvette looked like--a "Sting Ray". Today, it's hard not to laugh at middle aged guys on weekends wearing dress shoes with no socks, short pants with golf shirts and smoking cigars who climb into a car that has the "Corvette" name on it, but otherwise has nothing in common with such a proud history of a car that began as "The Ugly Duckling" in 1953. It later became the subject of Beach Boys songs like "Custom Machine" in the 1960's. And what about those cars Bruce Springsteen and Jon Bon Jovi like? A 1969 Chevrolet Chevelle SS 396 for "The Boss" and a 1972 Chevelle SS convertible for Bon Jovi, respectively. Both cars are little more than a memory. Old's Cutlass in 1972 was dubbed "the last muscle car". Buick was always sort of the "poor man's Cadillac". And even Cadillac today has little innovation. Pontiac was the car for the young set with John DeLorean's G.T.O., the Firebird and Trans Am. Today the brand captures only 2 percent of the U.S. marketplace. Each brand has its own budget, dealerships and is poorly organized, unlike a no-hassle sales floor at Saturn where sales people don't rely on a commission. Why can't they translate that across the board into brands people want? Because they have serious "issues"._
Saab alone drains over $150 million from G.M. in losses. GMAC (General Motors Acceptance Corporation), the financing arm was sold off just in time for those menacing Di-Tech dot com commercials to run in heavy rotation for home sales until the housing market crashed. Oldsmobile was dumped in 2000 and ended up costing G.M. $500 million to make it disappear. Buick is so far from the 1948 Roadmaster convertible featured in the movie "Rainman" that it isn't funny. Buick is still a big deal in China, but who can name three models of Buick's today? See? The same is true for Pontiac which has only 2 percent of the U.S. car market. Unbelievable! Can you identify a "G-6", a "G-8" and tell me how it differs in looks from a "Grand Prix"? Or, can you imagine driving a Hummer in Phoenix with gas at three grades of prices: $4.25, $4.35 and $4.55 a gallon? I doubt even Demi Moore drives a Ashton Kutcher around in L.A. in one with the windows tinted black! I regard the Hummer the way I do an Airbus A380 jet aircraft with one word: "Odious". Enough already. What's "The Plan"?_
The Plan: CEO Ron Wagoner wants to cut all G.M. brands down to just 3 and raise $15 billion in capital quickly. His aim is to make G.M. profitable by 2010. He better work fast at the rate this company is burning through money with it's shamefully outdated company structure. It has just 6,700 dealers but that will shrink as the financially stronger ones will be buying up the smaller, weaker dealers. Credit must go to G.M. for investing in "The Volt" an alternative energy car. G.M. is moving on this front faster than Ford or Chrysler. White collar lay offs numbering into the thousands are next as this company hopes it can "shrink" to producing just 20% of the U.S. market. You know the world has changed here in the United States when Toyota's Camry outsells all of G.M. brands combined. Detroit has never been in worse shape, as a city that leads the nation in violent crime. Like Pittsburgh's shuttered steel mills, Detroit and other dead-end cities like Cincinnati no longer have well paying jobs. Just a lot of empty decaying buildings, neighborhoods rotting away and unemployed workers who know the well-paying jobs they once had are gone forever unless they move on elsewhere. And if G.M's plan fails? With 284,000 employees worldwide, Chapter 11 at least is one item that will not be crossed off "The List" anytime soon. Sad as it is, my professor in a class I took called "Psychology in the Workplace" said "If you don't embrace change, you'll be left behind". He is right. Tomorrow, we look at Ford and my Mustang GT!
My Complete Website is: www.michaelmanning.tv
posted by Michael Manning @ 12:00 AM
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18 Comments:
Buick LeSabre.
Buick... um...
You're right, I can't name three.
Buick was my grandmother's car.
Nobody drives a Buick anymore,
except apparently the Chinese.
GM and America used to be synonymous.
Gaa. I hope that's not still true!
Seraphine: I'm serious! If you flew to China and called for a professional car, chances are good that a suited driver in a Buick would arrive at the curb to pick you up! You're so right. We've lost our pride in this great country and that's why these brands mean nothing. It's because the executives have no vision and worse...they don't care. It's all ego and no results from the heart. lol!!!
Ignorance is bliss - I mean come on, you don't even know the correct name of the CEO of GM. Besides, when was the last time you were in Detroit desert dweller. Obviously the auto situation is not isolated to GM, the auto industry as a whole is rebuilding itself in a Global economy that has literally burst on the scene - Auto [GM] ran the table for 100 years, everything has a cycle and they will emerge to lead again - Guaranteed. I mean you are busting on Buick only to acknowledge smirkingly that they are a staple in the newest emerging market - China. Now go take a ride in your Mustang GT - that 'Icon' is really lighting up the sales figures - down to the local library and pick up a copy of the latest Annual Report to find out what GM is "really" doing and cross check your executive names. I'll take a Chevy Malibu, Pontiac Solstice, Cadillac CTS (yeah that GM car sucks), Saturn Aura, or Buick Lucerne - and oh yes even a Corvette Z07 - (all equipt with OnStar of course)thanks. Michigan & GM Pride Forever!!
Corvette Stingray used to be my dream car when I was a kid!
I still laugh at old guys in convertibles - never mind they are quickly becoming my contemporaries!
Good Morning jimmyjames! I wanted to thank you for your passion and for giving me an opportunity to briefly clarify. As a "desert dweller" of only 6 months who spent much of my youth in Detroit, I telephoned GM this morning and as of 5 minutes ago, the Chairman and Chief Executive Officer of GM is Mr. G Richard (Rick) Wagoner, Jr. as my write up correctly stated.
You may be referencing President and Chief Operating Officer Frederick A. (Fritz) Henderson. The Group Vice President and Chief Information Officer of GM is Mr. Ralph J. Szygenda. In this tier that I just outlined , the CEO always directs the strategy, and Mr. Wagoner is deliberately moving forward to make a correction to the marketplace as you correctly mentioned. This is a 54 year low for GM which is sad.
I AGREE with your point about globalization. And you are correct about China as an emerging market. However, I believe my point was lost. I was not beating up on Buick or any single moniker. What I endeavored to do (with great regret ) was 1.) Convey that the industry in general for too long has had uninspired leadership. Tthere has to be an incentive for leaders to change and not simply sit idle and take home millions. Herb Kelleher, who just stepped down as Chairman of Southwest Airlines after 35 years was one who always embraced change. His incentive was his deep caring for his employees.
2.) Yes, I spent a lot of my life growing up in Detroit, Michigan and you will not find a workplace that has a better pool of skilled workers as we have in Detroit. HOWEVER, the "outsourcing" of America went too far and now we've stripped ourselves of our manufacturing base. to be competitive. We've (perhaps inadvertently) alienated and unemployed many fine men and women (including my Uncle who always new drove a Ford GM and Chrysler every 2 years).
3.) We have opened up our markets to foreign companies who have built mundane looking cars that deliver more Return On Investment than what we produced from 1973 forward. The “Big Three” are addressing this. But the halcyon days are over. Marketing numbers are being revised to 20% for each of The “Big Three” & with scaled down size and scope. I don’t like this fact, but it is the reality--not something that you and I created.
In summary, I feel we agree on these points and we could positively discuss what we'd like to see ahead. But I am told by the experts that with our infrastructure in Detroit stripped bare, we have no manufacturing base there or in any part of the country. Pick most any product from Steel to Beer and you’ll see closed steel mills sold to foreign companies and shuttered breweries.
Having said this, I AGREE with your passion and spirit that we need to bring Detroit back. I just question whether it is too late. Thanks again!
Morning, Patti: No way! :D)! lol!!!
I admit that I haven't thoroughly researched the industry, and while it's sad that it's going downhill, I also can't help but blame them for not keeping up with what consumers wanted/needed in relation to the competition. Honda and Toyota started becoming popular almost 20 years ago, not two.
OK so I made a few knee jerk comments - I do believe we are on the same page in many respects. However, I would expect that as a FORMER Michigander with a seemingly impressive media background that you would pass on jumping on the bandwagon with all the news whores out there looking to kick a man [GM] while he is down - which is the impression I got from the AUTOMOBILE WEEK: G.M. (Part 2) article. The reality is that GM is reacting to and quite frankly ahead of many of the changes in the Auto industry. While it may not all be the greatest of news for Detroit or even US employment in general today - the future is still there thanks in no small part to the leadership in this industry - spearheaded by GM execs (it's RICK Wagoner - your article says RON) – They have made some significant strides that don't get the press they deserve. Such as: 1) New UAW Contract with long needed concessions - without this there would be many, many, many people out of work & the auto industry would be effectively shut down - period; 2) International Share is way up, setting records for 3 consecutive years - over 4.5 Million cars/trucks sold in Europe, LAAM and Asia Pacific – which will ultimately create jobs for us here in the US via cash stabilization and quite possibly new manufacturing opportunities. 3) Innovation - GM's styling is getting major accolades, Enclave, CTS, Acadia, Tahoe (I own one of these, totally awesome vehicle) - visit a showroom (and being a pre-1970's guy, have you seen the Camaro that is hitting a production schedule this year - well you'll be able to spot that one coming from a mile away, trust me) not to mention leading technology advancement in Hybrid, Fuel Cell, Electric and Ethanol and last but not least Information Technology solutions. Time will tell, but I’m keeping my glass half full! [Becky Toyota just knocked GM off the top spot for Manufacturing Vehicles this year, I understand they have been chipping away for the past 20 years - mainly based on price, not quality and most definitely not style.]
just like monogram queen, the Corvette Stingray of the '70's was my dream car.
becky: A good point.Thanks!
jimmyjames: Appreciate the note Thanks, again!:)
jean-luc-picard: Oh, yes! My brother once owned a 1966 Vette' ..for 6 months. It was stolen. Beautiful cars.
They just don't make cars like they used to.
No class just plastic.
I've owned a 74 dart, friends drove cars like the 69 Chevelle, 67 Camero ss,a 70 Chrger and a 68 Charger.
Thise were cars and when you started the engine you could feel them in your soul and there was no need for airbags because they were solidly built.
Now you can fix the new ones with a tube of crazy glue
Isn't it sad that all of these companies didn't take the hint from Japan and build a decent Hybrid?
My daughter has 120.000 miles on hers
and gets 47 mpg.
The best the Ford Escape can get is around 28 to 30..
Looking forward to your Ford post.
In an earlier life I handled warranty at a Chevy dealership. That year - 1980 - Chevrolet sold more cars in the U.S. than all Japanese makes combined. What a truly sad state of affairs.
The sweetest driving car I ever owned was a '77 Camaro. The wife's new Mustang is nice, but still doesn't have the feel of that car.
Looking forward to your Ford post as I've owned more Ford vehicles than any other brand. (I have three right now.)
I just want the Purple one !!LMBO
Hope your well and having a fantastic summer , have some fun in the sun and put the hood down and sunblock on TEE HEE
Take care
Greeneyes
Walker: I love your comment about feeling these vehicles "in your soul". I'm sure Steve McQueen experienced this with his fantastic collection of cars, trucks and bikes too! Well said, my friend!
Green Tea: You and Bud Buckley have both reminded me that the actress Meryl Streep has been driving a Hybrid for many years. Imagine that! Being able to afford any car she wants and she chooses a Honda Hybrid. Glad to see your daughter has as many miles as I do on the Odometer! lol!!!:)
p m: Fords were always interesting. In my city, there is a dealership that restores and sells vintage cars. I once photographed a nice 1961 Ford Galaxie hot rod the first day it was placed on display. The next day it sold for $32,500 cash to some guy who had it shipped to California. Man was THAT a beauty!
Greeneyes: lol!!! You're so very right. This place is like an oven. But I use SPF 70! :)
Hi Michael
I really don’t know a great deal about the USA market and your brands. All I can do is make some broad observations which I am afraid are somewhat unflattering in relation to the auto industry and its worldwide operations as a whole.
It seems to me the large USA car manufactures resemble dinosaurs, who have not responded to the dire need to build cars that are economical and cater for consumer needs. By way of example you can buy any number of European four cylinder turbo diesel variants, some with carbon filters which use only 5--6 liters of diesel per 100K on trips. That’s the equivalent of much better than 40 miles per gallon.
We had our first oil shock wave back in the seventies yet mpg has scarcely improved until recently. The modern day four cylinder variations have the same torque as four litre equivalents in petrol which use more than double the amount of fuel; half the size capacity but the same torque. So there is plenty of pulling power and superior power to weight ratios. We had the spectacle recently of GM in Aussie land launching a new brand with a V8 engine, utter madness! This is in stark contrast to the consumer needs for smaller cars, to be much more economical yet comfortable and powerful enough to be a pleasure to drive with very good road handling. There is no longer any need or justification for 6 cylinder or 8 cylinder variations. Today there are number of cars which are roomier yet are much smaller in overall dimensions to their predecessors due to improved design.
Insofar as the strategy is concerned I think the long suffering shareholders of GM would be delighted to know some new ideas are actually going to bear fruit, particularly if you were unlucky enough to be a stockholder in GM for the last year, as you have already suffered a 69.56 % loss in the stock prices as of to day. I’ m sure you have the capacity and expertise to build cars and manufacture appropriate economical engines, but what is needed is a totally different design and I’m afraid most of the tooling is obsolete.
Best wishes
lindsaylobe: Many thanks and well said! We hope for the best, It's a commodity-driven economy even if we wish for the 1970's or 80's. Best!!! :)
I really liked how you attributed the GTO to J.Z.D. It really was his car, not GM's. Thanks for giving credit where it is due.
As for Saab, the company was slightly profitable before GM bought it. I feel they ruined the eclectic company with their 'mainstreaming' of it. The introduction of the V-6 was the biggest mistake, IMO.
Martini: Martini: Having owned a Saab Turbo in the past, you make a very good point about the V-6. I feel that if John DeLorean had the luxury of time and cash on hand, he would have made major changes to the car company he founded. As history shows, he was vindicated. I hope that his family will take comfort in remembering that John employed thousands of people with new jobs. He learned many hard lessons in life and he shared them in his biography with admirable humility. I wish that I could have interviewed him! He was an engineering visionary!!!
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