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PurdueGuy

Get rid of brands...

7 posts in this topic

This is kind of a spin-off from a comment in the thread discussing the interest in Hummer by a couple companies from India:

Even "worthless" brands like HUMMER still have a corporate shell and legal identity in the US already in place, with a dealer network. These foreign companies can capitalize on that to save a lot of money on entrance to the marketplace.

What would it take for GM to merge some brands? Take the whole clustering of brands (Buick-Pontiac-GMC for example) to the next level, and have them share a corporate shell and legal entity. Let's call it "GM Specialties" for now. Some thoughts:

+ Dealerships would have a contract with "GM Specialties", not the specific brands contained within. A Specialties dealership (auto boutique?) could order (or not order) any product from the Specialties' included brands, maybe with some requirements/standards as to how the products are displayed and/or marketed. This is not terribly different from a department store. If, for example, California has very little demand for product A, but the midwest does, then maybe some Cali dealers will choose not to order, stock, or market product A. They could still be able to special order product A for those few people that "gotta have."

+ "Failed" brand-names could be phased out without severe legal repercussions. They could also be right-sized. Think Hummer taken down to only one model (probably a Wrangler competitor). When one brand-name shrinks because of market demand, Specialties management can recognize where the market is growing, and provide more product in that segment to even things out (SUVs get cut, new compacts introduced). The dealership may be a little frustrated at having to rework some showroom floor to adjust, but for the most part they're happy because their product is moving with the market.

+ Brand names never truly die. What's to say they couldn't bring back Olds as a couple special models? Drop Hummer for a little while, then bring it back? GM doesn't have the $$ to invest in a product worthy of a brand/segment? Wait a couple years, the dealer has other product to keep it afloat.

+ While in some respect, this idea is another way to homogenize GM, and in a management level kill some of the things that make brands special, it really empowers brands as well, allowing them to be what they are truely meant to. Pontiac is burdened with having to carry some plain-jane models and rebadges, because the dealers need product that'll sell. If there are other brands to support the same dealer in volume sales, then brands like Pontiac have more freedom to exist as fewer, more true performance vehicles.

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I've thought this way from time to time myself.

Why not take it a step farther?

Make all dealerships GM dealerships and allow any GM car to be ordered by any dealer.

Then pare down the offerings to the essence of each brand while eliminating the re-badge problem.

Keeping all of the brands.

It could be an all-around solution for everyone, if the franchise laws allow it and it is done right.

It certainly would be more in line with current market share and should save huge money for GM.

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I have thought about something along these lines before as well. It makes perfect sense and would allow dealerships to become much more flexible than they currently are tied to one or a few brands. I could see some of the premium brands like Cadillac wanting to remain separate from the "plebe" brands, so they could have their own luxo dealerships. But why GM insists on continuing to rebadge (didn't they learn anything from the 80s) rather than giving brands like Buick and Pontiac one to three models that speak for what the brand is about.

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I like your idea Camino, but I still say dump SAAB & Saturn.

Drop those two brands like a sack of potatoes.

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I like your idea Camino, but I still say dump SAAB & Saturn.

Drop those two brands like a sack of potatoes.

Just Saab, please. :)

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I like your idea Camino, but I still say dump SAAB & Saturn.

Part of the idea is to let the market say what gets dumped, kept, or grown. ;)

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