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.
