GM sucks. there’s just no way around it. their brands (if you can call them that) are bland, taking badge engineering to a whole new level. they’re hemorraging money, yet they refuse to admit there’s a serious problem with their company. and just this past week, when a pullitzer-prize winning journalist for the LA times wrote a review for the pontiac G6, calling for the head of GM CEO/chairman rick wagoner, GM decided they didn’t want to play with a poopy-head, and quickly pulled all advertising from the paper.
whatever happens from here, this will be a bad PR move for GM. it shows they’d rather deny the fact that there’s a much deeper problem, than respond to criticism (as non-constructive as it may be). if GM turns around and offers a public apology, consumers will wonder why management can’t get things straight, and GM will lose sales. if they decide to stick by their guns and not advertise in the LA Times, they’re losing a large media presence and again, will lose sales. just who is it they’re trying to appeal to with this move? GM’s loyal buyers aren’t going to be swayed by the opinion of one writer, nor will public approval suddenly swing in the automaker’s favor for not letting a journalist speak his mind.
a recent editorial by syndicated columnist robert farago on the truth about cars stated what has been the general consensus on GM: too many “shared” cars between brands, competing for the same market segments, and not enough distinction overall. they’re only afloat due to brand loyalty, buyer habit, or just plain luck… probably a combination of the three. what farago suggests is that GM split up, using AT&T as an example:
GMAC Finance is the only solidly profitable part of the entire multi-billion dollar corporation; everything else is either limping along, a dead loss or a loss leader. Dump the car and truck making side of the equation and GM becomes instantly profitable. What’s more, under independent ownership, each division would be leaner, meaner and quicker on its feet. Think about the breakup of AT&T, and the highly competitive, hugely profitable baby Bells it spawned…
the problem with this idea is that most of the baby bells actually died off pretty quickly. the survivors eventually conglomerated into the huge telecom companies of today—SBC, verizon, bellsouth, qwest, etc.—running into a lot of the same problems as before. in addition, spinning off GMAC finance: does that make sense? I’d assume that most of their earnings come from car loans. by spinning off individual brands, a sizable chunk of revenue would instantly disappear.