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Study: Product Woes Hobble GM

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"A new report from Merrill Lynch suggests that GM has been investing too little in new products for a long time and it isn't clear that even in the present crisis, the auto giant is prepared to change. "We believe GM will continue its historical pattern of underinvesting in product to the detriment of earnings and stock price," noted a new research report from John Murphy, Merrill Lynch's new auto analyst.

"GM's market share losses are not new news. The company's consistent underinvestment is the primary driver of its consistent market share losses," the report says."

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"The numbers are pretty stark, according to the numbers worked up by Merrill Lynch. In 2005, GM's spending on product development was $1611 per vehicle, while spending on legacy costs, including pensions and retiree healthcare amounted to $1338. Meanwhile, competitors are investing much more aggressively in future product than GM."

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"A new report from Merrill Lynch suggests that GM has been investing too little in new products for a long time and it isn't clear that even in the present crisis, the auto giant is prepared to change. "We believe GM will continue its historical pattern of underinvesting in product to the detriment of earnings and stock price," noted a new research report from John Murphy, Merrill Lynch's new auto analyst.

"GM's market share losses are not new news. The company's consistent underinvestment is the primary driver of its consistent market share losses," the report says."

ahh... its okay, i think GM is starting to get straightend out... they just need to get their mojo back, and it doesnt matter what they produce... if they have their mojo and their "general" mentality, GM will always outpace the industry

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It makes sense that GM would not spend as much on each product as the basics are shared with so many other cars reducing the overall cost of coming out with something new.

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I was going to make the same point, Dsuupr. With the same engines, platforms and transmissions being shared across GM's many divisions, of course it's going to look like GM is spending less per vehicle than a company like Honda which only has two divisions.

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"A new report from Merrill Lynch suggests that GM has been investing too little in new products for a long time and it isn't clear that even in the present crisis, the auto giant is prepared to change. "We believe GM will continue its historical pattern of underinvesting in product to the detriment of earnings and stock price," noted a new research report from John Murphy, Merrill Lynch's new auto analyst.

"GM's market share losses are not new news. The company's consistent underinvestment is the primary driver of its consistent market share losses," the report says."

Thre words: GM has "TOO MUCH OVERHEAD"

So what in the hell do these people suggest GM do?!?!?!? Any suggestions?!?!?! No, that's what I thought, just detremental CRITICISM.

VERY GOOD POINT dsuupr....

This is nothing more than more GM smear propaganda from the street... They got the whiff that GM sales might be up for February, so they put this 'study' out to try and kill the momentum... It's simple. And trust me, you'll see A LOT more of this if GM reports positive sales for February.

Nice that they started out by dumping all over the GTO (Told you the media would)

Thus, GM decided to pull the plug on GTO without even bothering to find a replacement for the car.

LOL...Ummm. Okay. First of all DELAYED Zeta was supposed to replace the car. Secondly, anyone who knew anything about the current car KNEW that it would go on hiatus when Holden made the switch.

At the same, time GM also shut down an assembly plant in Oklahoma City that build mid-size sport-utility vehicles. GM is ostensibly working on a replacement for the current mid-sized SUVS, which are also being supplanted by a new generation of crossover vehicles.

Okay, so the street bitches because GM has overcapacity problems, then the street bitches when GM closes plants too?!?!

Same story, different day... GM is damned either way and THAT is a perfect, wrapped in a red bow, example of MEDIA/ANALYST BIAS.

GM needs to kill 2 divisions... NO, NO, NO, wait!!!! GM needs to develop MORE product!!!!

PICK A SIDE!!!! At least then you'll SEEM credible.

However, GM's crossover replacements won't be ready until later this year when the company opens a new assembly plant outside of Lansing, Mich.The start-up of the new Lansing plant has been pushed back by years as GM has wrestled with decisions on what to build in the new plant.Consequently, the new crossover from Lansing will be rolling out months after competitors have managed to introduce a new generation of crossovers to the public.

And this matters.... WHY? As long as the product is good, then what's the problem????? I don't see 100 articles on how Toyota is introducing a fullsize truck 50 years later than GM in that segment.

For GM, the relatively lower capital spending and spending on research and development has resulted in a less competitive product lineup for GM, according to the replacement rate charted by Merrill Lynch.GM's product replacement rate is lagging the competition, which is one of the main reasons why GM's market share has dropped.

So THAT'S what this report is about: RECYCLED GARBAGE.

(For those of you who remember, ML also put out a report like this last year stating that ALL of the big 3 had this problem.)

Nor did it address the problem with GM design, which has been left in the dust by its rivals over the past decade.

Wow!!! A statement of subjective GARBAGE passed off as fact, what a surprise...

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