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Justin Bimmer

It appears Pontiac owners are choosing to look for their next vehicle at. . .

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GM Orphans Up for Adoption

November 23, 2009

General Motors last week began sending out 1.8 million pieces of direct mail to what the GM logo - 119.JPG automaker calls its "free-agent customers" -- customers orphaned by the wind-down of Pontiac and Saturn and the proposed sell-off of Hummer and Saab.

In this first of promised multiple mailings, GM is offering discounts of up to $2,000 on certain models to the nearly 1 million customers of closed GM dealerships, if they go to the next closest dealer by Jan. 4. The automaker also is giving customers of closed dealerships a vehicle inspection and tire rotation at remaining dealerships through May.

"The challenge for us is to grab those customers by the hand and make sure they know where to go," Susan Docherty, GM's vice president of U.S. sales, said in a media conference call last week.

But GM's competitors also are eyeing those up-for-grabs customers.

All in the Family

Keeping GM orphans in the family is critical for GM to meet its market share goals. GM's post-bankruptcy plan calls for the automaker to achieve 19 percent plus market share to be profitable.

In October, GM's market share matched a high for the year of 21.1 percent with all eight brands counted. Of the total, 19.3 came from the four brands GM is keepin; 1.8 percent came from the brands GM is shedding. That roughly 2 percent of market share could make the difference between profitable and not profitable.

Competitors Eyeing Orphans

While it does what it can to hang onto the free agents, GM has some competition for them. In particular, Ford, Toyota, Nissan and Honda have a good shot at nabbing them. And Hyundai/Kia, on an aggressive march for market share this year, can't be counted out.

Ford's Jim Farley, group vice president of global marketing, told AutoObserver last week that the automaker has no specific marketing aimed at going after GM's orphan customers. But, in the local trenches, Ford dealers are appealing directly to those customers in their marketing as well as by hiring salespeople and fleet managers from defunct GM dealerships, he said.

In October, Edmunds.com cross-shopping data showed:

- Chevrolet was the most cross-shopped brand with Pontiac, Saturn and Hummer shoppers.

- Ford was the most cross-shopped non-GM brand with Pontiac and Hummer shoppers; second with Saturn shoppers. Toyota edged out Ford with Saturn shoppers.

- Nissan and Honda rounded out the list of top five cross-shopped brands for Chevrolet and Pontiac. Toyota, BMW and Jeep rounded out the Hummer top five cross-shops.

- Saab owners could be lost too all import brands as Volkswagen, Audi, BMW and Honda, respectively were the most cross-shopped in October.

October's cross-shopping trend represents a snapshot in time. Cross-shopping can fluctuate from month-to-month depending on new vehicle launches and incentives.

Finding Another Dealer

In addition to eliminating four brands, GM is slashing about a quarter of its dealers. To customers of closed dealers in the family, GM, in its Nov. 16 mailing, is offering discounts up to $2,000 to 950,000 customers of the closed dealerships. It is also offering discounts of between $1,000 and $2,000 on certain models, depending on the customer's "likelihood to purchase a GM vehicle and the relative distance to the next closest dealer," according to a copy of a GM letter to dealers obtained by Automotive News. The sale runs through Jan. 4.

"This is our way of trying to keep our current customers in the GM family by making it easy for them to get back into a dealership," a company spokesperson told the trade journal.

GM assures there will be more chapters to this story, including a wave of incentives to include orphaned Saturn customers early next year. Docherty said GM's strategy to keep customers of its eliminated brands and closed dealerships would be detailed later.

Closed Dealers Angry

Automotive News reports some dealers who are fighting their closure by GM aren't happy about the incentives being offered to their customers to shop elswhere.

"This is an inappropriate time to take such an aggressive measure," Tamara Darvish, a leader of the Committee to Restore Dealer Rights, a group of rejected dealers that is in talks with GM to keep dealerships open, told the publication. "If in fact dealer rights are to be restored, why would GM go in and move all those customers?" -- Michelle Krebs, Senior Analyst and Editor at Large

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Chevrolet was the most cross-shopped brand with Pontiac, Saturn and Hummer shoppers.

What? Chevrolet and Pontiac being cross shopped? Pffft not possible. Those two brands are NOTHING alike!

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What? Chevrolet and Pontiac being cross shopped? Pffft not possible. Those two brands are NOTHING alike!

And everyone wonders why there are dozens of threads complaining about Pontiacs closure? Because every new article that is posted, the first reply is something like the above reply.

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And everyone wonders why there are dozens of threads complaining about Pontiacs closure? Because every new article that is posted, the first reply is something like the above reply.

I don't think you understand. Pontiacs and Chevys are IDENTICAL. I was not being serious when I posted that. I was making fun of people who think what I put in my first post because the hard DATA shows there really is no difference. They aren't shopping BMW, Porsche, or Audi. They are looking at Chevy and Ford to replace their Pontiacs.

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What? Chevrolet and Pontiac being cross shopped? Pffft not possible. Those two brands are NOTHING alike!

And no one ever said G3s G5s and G6s aren't cross shopped with Aveos Cobalts and Malibus. But I doubt the G8 was being cross shopped with the Impala. I bet all that was left in October was G3s G5s and G6s, and the G8s and Solstices are probably sold out. So it only makes sense that Chevy would top the list right now.

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And no one ever said G3s G5s and G6s aren't cross shopped with Aveos Cobalts and Malibus. But I doubt the G8 was being cross shopped with the Impala. I bet all that was left in October was G3s G5s and G6s, and the G8s and Solstices are probably sold out. So it only makes sense that Chevy would top the list right now.

Good point on that.

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I don't think you understand. Pontiacs and Chevys are IDENTICAL. I was not being serious when I posted that. I was making fun of people who think what I put in my first post because the hard DATA shows there really is no difference. They aren't shopping BMW, Porsche, or Audi. They are looking at Chevy and Ford to replace their Pontiacs.

Yes, people like me who have said I would buy a Porsche, BMW, or Audi, and owned a Pontiac GTO. None of us ever said G5s were being cross shopped with the 335i.

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And everyone wonders why there are dozens of threads complaining about Pontiacs closure? Because every new article that is posted, the first reply is something like the above reply.

Exactly true.

It's time for that sort of thing to stop, people who are already down about something don't need to be repeatedly kicked in the teeth.

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I'm waiting to see how far back they go on the scrolls to extend a hand to owners of Pontiacs, Saturns, Hummers, an Saabs.

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You know, the owner scrolls. I thought it sounded much cooler than the database.

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And the teeth kicking will end here.

Everyone should consider this their first verbal warning.

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One sometimes has to wonder if GM might still be using scrolls, but let's hope not.

:smilewide:

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One sometimes has to wonder if GM might still be using scrolls, but let's hope not.

:smilewide:

It would be fascinating to do data mining on GM sales data from the last 10-20 years...see who was buying what where..

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On the positive side, dropped by my local Buick dealer to check out the new LaCrosse in person.

SWEET car.

Chris

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Isn't this why GM still has EDS? To do all the data running on the Cray?

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Isn't this why GM still has EDS? To do all the data running on the Cray?

EDS is owned by HP these days..GM spun it off in '96.

I'm sure GM marketing slices and dices all the data about their customers... I'm not a marketing guy, but as a database and enterprise software guy, I find data mining fascinating.

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Back on the news item a bit, 2K might be a good place to start.

I'm just not so sure that it will get them from A to B.

For the owners of the best-loved Pontiacs, they need more product options. For some of the Firebird faithful, the Camaro is a natural progression - but is it enough?

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Well, I see Buick w/ the Regal picking up some of the Saturn Aura and G6 market and the Acacia getting the Outlook market. Not sure where Astra owners would go besides the Cobalt and Cruze, though the sales of the Astra were so small that it's not that signficant. And nothing currently for Solstice or Sky fans.

Edited by Cubical-aka-Moltar
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The more mainstream models are pretty easy to find analogs for at GM's other brands, it's the others that will be more difficult. For the former, a healthy rebate might do the job. For the latter, it will have to be a product-based enticement.

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Which is why I am glad PCS is doing what he is doing.

Actually I have high hopes for the Holden thing.

Chris

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As do I.

Timing will be critical though.

If the economy weren't so grim, I might say that it was already too late. It is that grim though, and ironically, that might buy GM the time it needs to get things right.

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So here is how I see it. I am trying to be sincere here as well.

Pontiac alternatives at GM

G3 - Aveo

G5 - Cobalt soon Cruze

G6 - Malubu soon Regal

G8 - SS or Zeta soon

Solstice - was going to be canceled anyways, GM is gonna lose that business

Firebird/ TA - Camaro

Saturn alternatives at GM

Astra - Regal, maybe a Regal wagon someday

Aura - Malibu soon Regal

Sky - same as solstice above

Outlook - Acadia, Traverse, Enclave depending on options

Hummer alternatives at GM

IDK, maybe GMC trucks/ SUVs?

Saab alternatives at GM

I think GM is trying to use Buick as the carrot here.

So it appears from my scroll reading :AH-HA: that Buick is going to be taking on the brunt of the new GM orphans.

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EDS is owned by HP these days..GM spun it off in '96.

I'm sure GM marketing slices and dices all the data about their customers... I'm not a marketing guy, but as a database and enterprise software guy, I find data mining fascinating.

EDS still has significant contracts with GM, who do you think the OnStar people are that you get when you push that little button,? Who do you think is still running their Legacy systems? GM? Nahhh it's (Every Day Sucks) ...

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