NINETY EIGHT REGENCY

On The Table ( Peter De Lorenzo)

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ON THE TABLE

GM. Taking a page from Toyota's playbook, GM is considering eating some of the cost of its upcoming two-mode hybrid transmission system in its full-sized trucks to make the technology affordable to consumers, Bob Lutz told Automotive News. With a cost rumored to be running near $10,000, GM probably has no choice. Toyota has regularly lost thousands of dollars on its hybrid cars in order to gain their acceptance in the market (even though they've repeatedly denied it). They consider it a worthy trade-off and part of taking the long view of things. Something heretofore anathema in Detroit. It's not the first time Toyota has taken the long view to make inroads in the U.S. market, either. They did the same thing when they launched the Lexus brand here in 1989, pricing it $15,000 below its competition from Mercedes and BMW and taking a huge hit on each one just to get a toehold in the luxury segment. With Toyota having pulled the environmental leadership positioning right out from under GM (and the rest of Detroit) over the last five years, GM is going to have to suck it up and play hardball the Toyota Way if it wants to have a shot.

GM. It was probably an impossible task to begin with, but GM's quest to keep the next-generation Chevrolet Camaro hot for three years after its unveiling at Cobo Hall in January 2006 is proving to be even harder than that. For one thing, to say that the car has been overexposed already is an understatement. From magazine cover stories and "exclusive" low-speed test drives to giveaway posters and models, the new Camaro seems to be everywhere. And Chevy marketeers actually believed they were doling out info about the Camaro in measured bits and bites, walking a fine line between maintaining interest for enthusiasts and not having the "buzz" die down completely. That is until the movie "Transformers" came out last week. Suddenly, the new Camaro is one of the stars of one of this summer's biggest action blockbusters, and the car became exposed to a whole new group of consumers who hadn't seen it before. Which is great, except for the fact that as these interested consumers are finding out, the car won't be available until the first quarter of 2009, which means it won't be available in any quantity at Chevy dealers across the country until two years from right now. And to make matters even worse, the convertible version won't be available until one year after that. Although we sympathize with GM's (and the rest of Detroit's) plight in that they feel it necessary to show-off their best stuff early so that they can generate positive "buzz" from an openly anti-Detroit media at the major auto shows, Chevrolet and GM marketeers should have gone "dark" with the new Camaro immediately after showing it the first time. Even better, they shouldn't have shown the car at all except to dole out some tease photos intermittently. That would have been the way to keep the "buzz" and the interest in the new Camaro going. Instead, Chevrolet and its dealers are faced with the reality that upon its arrival in showrooms across America in 2009, it will be a four-year-old car to a lot of people. Will the Camaro sell in that time frame? Of course it will. But will it be a sustainable hit for Chevy like the recently revived Mustang has been for Ford? It's way too early to tell. There is something to be said, however, for subtlety and restraint when it comes to handling the launch of a hot new car or truck. So for now, we'll refer to the "non"-launch of the next-gen Camaro as one giant missed opportunity.

source:

http://www.autoextremist.com/index.shtml

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The difference between GM and Toyota when discussing the "eating" of some of the costs of the hybrid is Toyota can afford it GM can't. Toyota is still making major profits even while giving away money with every Prius. GM can't afford to be so generous and stay viable.

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>>"Taking a page from Toyota's playbook, GM is considering eating some of the cost of its upcoming two-mode hybrid transmission system in its full-sized trucks to make the technology affordable to consumers"<<

Unless the point is somehow that this involves a hybrid, GM has certainly 'eaten some of the cost' of a vehicle in order to reduce it's price, therefore rendering the phrase "Taking a page from Toyota's playbook" invalid.

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>>"Taking a page from Toyota's playbook, GM is considering eating some of the cost of its upcoming two-mode hybrid transmission system in its full-sized trucks to make the technology affordable to consumers"<<

Unless the point is somehow that this involves a hybrid, GM has certainly 'eaten some of the cost' of a vehicle in order to reduce it's price, therefore rendering the phrase "Taking a page from Toyota's playbook" invalid.

The EV1 also involved eating costs. These were leased only. They were a complete product line that sold only 1117 units. Obviously Toyota (again) didn't invent the concept.

There *is* a difference between intentionally taking a loss on one particular model vs. losing money on every vehicle that moves off the lot.

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