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Should GM dump more brands?

 
8 500 views Apr 27, 2007
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Should GM dump more brands?

Should GM dump more brands?

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It was going to happen eventually. Toyota surpassing General Motors in the sales race was not surprising in the least, but what happens now is anyone’s guess. How GM reacts to being dethroned from its number one spot could either send the company to the receivers or bring the American giant back to the top.

All signs point to GM dropping some of its underperformers and streamlining its portfolio. In essence, to become like Toyota. A report from Fortune highlights the fact that GM has more brands now than it did when it commanded more than 50% of the US market close to 50 years, seven in total. In contrast, Toyota makes do with just three, Toyota, Lexus and Scion.

GM maintains that having a wide portfolio is an advantage and the potential loss of customers by dropping a brand isn’t worth the risk. However, it may no longer be able to afford the massive costs required in keeping all of those labels such as marketing, advertising and distribution expenses. Instead, experts agree that GM should keep Chevrolet as its volume brand, Cadillac as a premium label and expand it with more models based on the CTS, while keeping Saturn as an import brand.

In regards to dropping some labels, first on the chopping block should be Buick in North America. Despite numerous new models and investment, sales have barely nudged from where they were years ago and cars like the new Enclave are unlikely to make any valuable inroads. The same could be said for Pontiac, while Hummer will continue to face an uphill battle in light of the greenhouse gas debate. GMC should focus on the commercial side of things as private customers move away from big and heavy trucks. Finally, Saab should be dropped altogether as its volume is simply too low to be worthwhile.



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Comments (8)

  1. By Kyle Rohde Posted: 4/27/2007 11:18am PDT

    If you pay attention to what's going on in China right now, there's no way you can dump Buick right now. Pontiac, Hummer and Saab should all go though, that's for sure. It'd be sad to see Pontiac die but what differentiating factors does it really deliver? The thing that might save it though is the G8. If that's allowed to stand on its own in the US and not have a Chevy/Buick/Cadillac version, it could bring Pontiac back like the 300 did the Chrysler brand.
     
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  2. By Gus Posted: 4/27/2007 11:51am PDT

    I think all the different brands are completely stupid.
    Maybe (MAYBE!) 2 brands, one luxury and one basic, like Toyota and Lexus, Ford and Lincoln, Chevrolet and Cadillac. Everything else should go away completely.
    Mercedes and BMW seem to do allright with just one brand, why can't everyone else?
     
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  3. By Palmer Posted: 4/27/2007 6:13pm PDT

    The sales of Daihatsu and Hino are counted in Toyota's total sales.
    That's five brands, similar to GM's domestic lineup.
    No way should GM drop the Buick or Pontiac badges. (Or Saab for that matter.)
    A Lucerne or Grand Prix beats an ES350 or Camry any day.
     
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  4. By Julius Posted: 4/27/2007 8:39pm PDT

    Kyle, Buick should definately be dropped, but only from the US market. Yes, the brand is doing remarkably well in China but the vehicles and taste over there is significantly different to the US. Just take a look at the new Riviera concept, could you EVER imagine anything even closely related to that reaching the States, NO WAY.

    Caddy is doing well and if Pontiac can get more cars with similar quality and design as the new G8, then it too will have a fighting chance. After the seeing the G8 at the Chicago show, I was extremely impressed and I'm usually a hard-ass.

    Saab should have been dropped years ago.
     
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  5. By Rambo Posted: 4/28/2007 2:03am PDT

    GMC is a cheezy rebadge brand that needs to go. It serves only to cheapen the image of the Pontiac and Buick dealers they share space with. If GM could shed GMC and reinvest into improving the image of Pontiac and Buick they would benifit greatly. Saab must go if it doesn't start seeing some funding. Cadillac, Chevy, Hummer and Saturn are good brands with a good solid and focused image.
     
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  6. By JT Posted: 4/29/2007 1:01am PDT

    I agree that biuck, hummer and pontiac should be dropped from the US market, GMC Genernal Motors Commercial. Saab needs more models ie coupe and convertible for the 9 3 and move the 9 5 to an Extended ep ie G6 platform and may be add short wheel base 5 seater suv from the
     
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  7. By JT Posted: 4/29/2007 1:06am PDT

    Opps!!!!!
    Saab needs more models ie coupe and convertible for the 9 3 and move the 9 5 to an Extended Epsilon platform and may be add short wheel base 5 seater suv from the theta platform. I love saab and will not want it to die.
     
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  8. By MoparMan Posted: 6/19/2008 5:20pm PDT

    All of you need to go with real quality: Chrysler!!!
     
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