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What if you were in charge of GM?

879 messages,  Last post on Feb 17, 2010 at 6:49 PM

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What is this discussion about? Automotive News, Classic Cars, Concept Cars, Future Vehicle


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#244 of 879
Re: If for some crazy reason I woke up in charge of GM [carnaught] by grbeck
Feb 24, 2009 (1:32 pm)
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Replying to: carnaught (Feb 24, 2009 8:16 am)

I agree that complaining that consumers don't "get it' regarding a particular car or brand is a waste of time. If anything, that displays one of GM's problems - namely, when things go wrong, it's somehow the consumer's fault.
 
The simple fact is that car companies, like people, EARN their reputations. And they aren't changed overnight by a bunch of hand waving, a flashy advertising campaign or bashing consumers or Consumer Reports. They are changed by several years of consistently top-notch models. This takes time and effort, and, quite frankly, GM, with its multiple divisions and often clueless management, has displayed a very bad case of corporate ADD in this regard.
 
GM builds some vehicles - Corvette, Silverado, Suburban, Tahoe, CTS, Malibu - that can run with the best in their respective classes. The problem is that those vehicles are drowning in a sea of mediocrity.
 
Take the Malibu. It competes well with the Accord and Camry. It looks better than either one of them. But it sits in the showroom with the Aveo, which virtually defines "bottom-feeder" and is hopelessly outclassed by the Honda Fit, and the Cobalt, which is mediocrity personified in glass, steel, rubber and plastic. Even worse, it shares space with the Impala, which is outclassed by virtally all class rivals, looks larger than the Malibu, but usually ends up being LESS expensive because of discounts.
 
So which is the "better" car? Is it the Malibu...it looks smaller, and historically the Malibu nameplate has slotted below the Impala nameplate. But it's also more expensive, and looks more "up to date" both inside and out.
 
This sort of muddled message confuses customers, prevents both the Malibu and the Impala from breaking through the today's clutter of many makes and models, and blurs the identity of Chevrolet as a whole.
 
Is Chevrolet the maker of competitive, attractive modern vehicles that offer American styling and nameplates (Silverado, Tahoe, Suburban, Traverse, Corvette, Malibu)? Or is it the seller of bargain-basement models that offer a low price and not much else (Aveo, Cobalt, Impala, Equinox, Colorado, Trailblazer)?
 
One can say the same thing about the CTS, Enclave and G8 in relation to their divisional siblings...not to mention Cadillac, Buick and Pontiac as brands.
#245 of 879
Re: If for some crazy reason I woke up in charge of GM [grbeck] by Mr_Shiftright HOST
Feb 24, 2009 (2:07 pm)
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Replying to: grbeck (Feb 24, 2009 1:32 pm)

My rule of thumb is that it takes a car company about 15 to 20 years to dig out of a bad reputation, presuming they don't continue to do bad things or mediocre things.
 
Good Example: Cadillac / Audi /Hyundai / Corvette
#246 of 879
Re: here's the deal [Mr_Shiftright] by cooterbfd
Feb 24, 2009 (3:42 pm)
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Replying to: Mr_Shiftright (Feb 23, 2009 6:54 pm)

Well, I checked out your "True Cost to Own"site, and this is what I come up with:
 
http://www.edmunds.com/new/2009/buick/enclave/101035082/cto.html?setzip=02809&vd- p=off
 
http://www.edmunds.com/new/2009/lexus/rx350/100975629/cto.html?setzip=02809&vdp=- off
 
Enclave:
 
 True Cost to Own
 
                     Year 1 Year 2 Year 3 Year 4 Year 5 5-yr Total
Depreciation $8,113 $3,920 $3,448 $3,056 $2,744 $21,281
Financing $2,262 $1,825 $1,355 $850 $308 $6,600
Insurance $1,645 $1,703 $1,762 $1,824 $1,851 $8,785
Taxes & Fees $2,695 $36 $36 $36 $36 $2,839
Fuel $2,524 $2,600 $2,678 $2,758 $2,841 $13,401
Maintenance $214 $556 $349 $1,481 $630 $3,230
Repairs $0 $0 $0 $297 $454 $751
        
Yearly Totals $17,453 $10,640 $9,628 $10,302 $8,864 $56,887
  
 
RX:
 
                      Year 1 Year 2 Year 3 Year 4 Year 5 5-yr Total
Depreciation $1,924 $4,690 $4,127 $3,657 $3,282 $17,680
Financing $2,346 $1,892 $1,405 $882 $320 $6,845
Insurance $1,997 $2,067 $2,139 $2,214 $2,247 $10,664
Taxes & Fees $2,640 $36 $36 $36 $36 $2,784
Fuel $2,653 $2,733 $2,815 $2,899 $2,986 $14,086
Maintenance $332 $642 $367 $1,139 $1,600 $4,080
Repairs $0 $0 $0 $397 $607 $1,004
        
Yearly Totals $11,892 $12,060 $10,889 $11,224 $11,078 $57,143
 
What's amazing is that while the Enclave suffers from a $4,000 deficit in resale, it more than makes it up in fuel, ins, maint., and repair costs.
 
$300 and change difference in ownewrship costs. Basically, A WASH!
#247 of 879
Re: here's the deal [cooterbfd] by Mr_Shiftright HOST
Feb 24, 2009 (4:15 pm)
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Replying to: cooterbfd (Feb 24, 2009 3:42 pm)

Yes that makes perfect sense to me. I think the so-called "edge" of the Lexus is that it affords the owner way more prestige (not arguable), is (probably, we don't know yet) built better, and will (arguably) have fewer problems. (source: Problems Chart.
 
We have to note where the Lexus sits on this aforementioned chart. It doesn't get any better.
 
Look, someone is going to get the world's worst RX and someone else will buy the world's best Enclave, and their stories will totally contradict these charts.
 
But that's what a large database is for. To defeat anecdotal evidence.
 
If I were head of GM, I'd pin this chart to the office wall of every high level EXEC in the company.
#248 of 879
Re: here's the deal [Mr_Shiftright] by imidazol97
Feb 24, 2009 (6:49 pm)
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Replying to: Mr_Shiftright (Feb 24, 2009 4:15 pm)

> and will (arguably) have fewer problems. (source: Problems Chart.
 
That difference would be 1.34 problems for your Enclave vs. 0.94 problems for the RX. In discrete math that means 1 problem for Enclave vs 1 problem for RX.
 
In the old days, there might have been a larger multiple difference between the number of problems reported by such a JD Powers report. But as JDP and CR have commented the differences in such numbers have shrunk in recent years.
 
For me it would come down to the dealer and how they are with problems. The Buick dealer with which I've been familiar through lots of years would take good care of me and any problems. I've had no contact with the Lexus store other than seeing advertising and browsing their showroom and used lot a few years back.
#249 of 879
Re: Another metric [steve_] by dave8697
Feb 24, 2009 (7:49 pm)
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Replying to: steve_ (Feb 23, 2009 9:44 pm)

Did they fix TCO to recognize the 6 yr 100k mile warranty from GM? Or do they still put over a thousand dollars of repairs per year for GM cars still under warranty?
 
Irregardless, There's NO American Entrepreneurial Spirit being driven by buying Imports or Transplants, even if they squeak out an extra couple thousand in value at trade-in time, 6 yrs down the road.
 
So true cost to own is not quite that. Look around to see what the true cost of buying Japanese is. Reduced tax base. Reduced education of America. Falling markets and home values. Rising unemployment and higher tax rates.
#250 of 879
Re: Another metric [dave8697] by steve_ HOST
Feb 24, 2009 (9:53 pm)
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Replying to: dave8697 (Feb 24, 2009 7:49 pm)

I don't know, but my guess is that they do, since warranty repairs are "free" to the consumer and wouldn't be reflected as an expense in the rest of the maintenance costs. "Free" in the sense that those costs should be rolled into the purchase price somehow.
 
You could use the Contact Us link in the Help section I suppose but you may get a response like "our formula is proprietary." But you never know.
 
The other "TCO" stuff is beyond the scope of Edmunds, but surely someone has tried to peg those costs somewhere. One example - The China Price.
#251 of 879
Re: here's the deal [imidazol97] by Mr_Shiftright HOST
Feb 24, 2009 (10:27 pm)
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Replying to: imidazol97 (Feb 24, 2009 6:49 pm)

Not quite. By achieving 93 problems per 100 cars, Lexus is therefore the ONLY car company on that chart that maintains the absolute assurance that SOME of their cars will have ZERO problems during ownership. And zero problems over the course of ownership is a *powerful* aspect of brand equity and reputation.
#252 of 879
Re: here's the deal [Mr_Shiftright] by lemko
Feb 25, 2009 (8:06 am)
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Replying to: Mr_Shiftright (Feb 24, 2009 10:27 pm)

Shoot, my 1989 Cadillac Brougham has had 0 problems over the last 20 years and 157K miles.
#253 of 879
Re: here's the deal [lemko] by Mr_Shiftright HOST
Feb 25, 2009 (8:36 am)
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Replying to: lemko (Feb 25, 2009 8:06 am)

Yes I understand Lem that you are quite satisfied with your car, but that is anecdotal evidence of a database of one. Collection of large amounts of data is designed to improve the possible errors inherent in making judgments based on anecdotal evidence.
 
Also your idea of "no problems" and mine might be different, because you have owner bias and I don't. (Although I could have anti-Cadillac bias, which I don't, but I could).
 
Also you could be (and probably are) exceptionally diligent compared to most car owners and thus have dealt with problems before they became break-downs.
 
Or to put it bluntly---your "good" 1989 Cadillac does not prove that 1989 Cadillacs were "good". The very opposite is just as possible. We'd have to collect a good database to know more about it.
 
The nice thing about JD Powers are CR is that they are merciless, unbiased and not in love with the cars they are testing (hopefully not anyway). They are statisticians.
 

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