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The O.C.

David E. Davis, Jr......October, 1988

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I'm retyping this from an editorial written by David E. Davis, Jr., in the October '88 issue of Automobile Magazine.....almost 18 (!) years ago.....about General Motors.....

He starts......."When was the last time you heard anyone suggest that General Motors was a dangerous monopoly that should be broken up?"

....and continues......"Never mind, General Motors has come a long way. All of the car divisions have spiced up their product lines, and some great saves have been made. We've seen an Indianapolis victory and a 200-mph Corvette. The Lotus connection is bubbling happily, and lots of exciting projects beyond the ZR1 Corvette are in the pipeline. Some very good executive moves have been made as well. A number of men with excellent hands-on automotive experience have been moved into key jobs in the past year. Obviously, General Motors is making a major effort to turn itself around."

"Unfortunately, it is still a corporation very much at odds with itself. Share of market is still down. The public still has doubts about the corporation and its products. The EDS acquisition has turned out badly, offsetting the Hughes Aircraft acquisition, which has been a big success. Internally, there are a lot of hurt feelings, bitterness, and management paranoia about what is characterized as GM bashing....the constant round of bad news and critical comment that's come from the national, enthusiast, and business press over the past ten years. One runs into senior GM guys who look at the world with the thousand-yard stare of people who've been in combat too long, guys who've been so gun-shy that they interpret comments about the weather as GM bashing."

"Deeper in the ranks, there's a growing morale problem among GM's best and brightest engineers, designers, and planners. They've heard all the corporate rhetoric. They want to believe. They're ready to play their parts in the great turnaround that must come soon in GM's core automotive businesses, but they see no evidence that the eighteen or twenty men who actually run GM have yet developed a vision of the automotive future, a clear-cut idea of GM's automotive mission. GM's future leaders are feeling a bit like Captain Yossarian in Catch-22, struggling in vain to save the life of the tail gunner dying in the wrong wound. They see themselves dutifully doing what they're told, making splints and rolling bandages for a patient whom they fear is suffering from advanced arteriosclerosis."

He concludes......."I think they should take another look. Perception always lags reality, and I believe that the midsummer round of management changes at GM will have an important ventilating effect on the corporate intellect and help the corporation through this process of redetermining who it is and why it's been put here. As mehitabel used to tell archy, when the things got grim, 'There's a dance in the old dame yet.' "

----------

I was thumbing through some old Automobile mags.....and came across this issue and got major goosebumps reading his editorial. It felt like I was reading something that very well could have been written TODAY.....almost two decades later!

It really makes you wonder if GM will EVER turn around. For all the changes, for all the new product, for all the Lutzs and Wagoners......What really has been accomplished in the last 18 years????

It's sad.....and scary....

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" For all the changes, for all the new product, for all the Lutzs and Wagoners......What really has been accomplished in the last 18 years????"

To the end user, meaning the customer - absolutely NOTHING positive!

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" For all the changes, for all the new product, for all the Lutzs and Wagoners......What really has been accomplished in the last 18 years????"

To the end user, meaning the customer - absolutely NOTHING positive!

Ummm... if the Solstice/Sky, Sigma Cadillacs, C6/Z06, GMT900s & Cobalt

are "nothing positive" to you then you might be spending time on the

wrong forum. :blink:

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Good trucks, and a handful of good niche cars. A lot of times when a company is on the brink, it has to reinvent itself. GM may not get many more chances.

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Ummm... if the Solstice/Sky, Sigma Cadillacs, C6/Z06, GMT900s & Cobalt

are "nothing positive" to you then you might be spending time  on the

wrong forum. :blink:

If less than 10% of the line-up is an impressive accomplishment to you, you may want to look up the definition of the word 'positive' in this context....

...It doesn't sicken you that the SAME issues haven't been resolved in two decades? GM's about to blow a 10 run lead in the 9th, and that's progress?

C'mon. You did that at work, you wouldn't have a job.

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Ummm... if the Solstice/Sky, Sigma Cadillacs, C6/Z06, GMT900s & Cobalt

are "nothing positive" to you then you might be spending time  on the

wrong forum. :blink:

Look at the big picture my friend. A couple models do not make a trend as The O.C.'s post illustrates from 18 years AGO.

Edited by evok

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I could go further back, to the mid-70s and pull out MT and Car & Driver doing their "shoot outs" and claiming that "Detroit is back."

Is this a clear indication that the Big Three have failed, or that everything has already been written before and these writers just rehash the same old stories every 10 years?

Or could it be that Detroit is just not building what these guys want to drive? And could we have witnessed the seeds of resentment when the media felt THREATENED by GM's market dominance and decided to knock it down a peg or two?

Let's face it: do these magazines benefit from 3 car companies that control 90% of the market, or 15 companies scrapping over 1 percentage point of market share?

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Look at the big picture my friend.  A couple models do not make a trend as The O.C.'s post illustrates from 18 years AGO.

The ONLY volume product GM offers that is TRULY class-competitive/superior is the GMT-900s...and they are REALLY good.....

The Sigma Cadillacs aren't. STS, while a "nice" car, is a dude in the competitive landscape....and CTS, as good as it is, still has issues that haven't been resolved (mostly poor interior trim quality compared to its upscale competition at BMW, Audi, and M-Benz.)

The others are much smaller volume products.

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I could go further back, to the mid-70s and pull out MT and Car & Driver doing their "shoot outs" and claiming that "Detroit is back."

  Is this a clear indication that the Big Three have failed, or that everything has already been written before and these writers just rehash the same old stories every 10 years?

  Or could it be that Detroit is just not building what these guys want to drive?  And could we have witnessed the seeds of resentment when the media felt THREATENED by GM's market dominance and decided to knock it down a peg or two?

  Let's face it: do these magazines benefit from 3 car companies that control 90% of the market, or 15 companies scrapping over 1 percentage point of market share?

Don't you see? It doesn't matter if it's DED Jr., or the Detroit News, or the LA Times, or Car & Driver, or James Healy....

The cars are simply not good enough to pull GM out of their hole.

The market is proving that.

Sure....a Lucerne is a nice car, and is getting good reviews. Is it going to bring people back into GM showrooms looking for a roomy, comfortable, stylish, powerful (with V8) sedan in the $30-$40K range? Chrysler showed how to do it (300C)......but GM insists on not competing on the same level.

You think a Malibu or Impala has ANY realistic chance of making ANY sort of dent in the eyes and minds of anyone seriously considering a new Camry or Accord?

Sure.....as GM enthusiasts, we like these cars.....and even critical bastards as myself can admit that I like the Impala....even the SS model. BUT, I will admit that car is no where NEAR the kind of product GM needs to do the job. Unfortunately, it's FAR from it.....

DED Jr's comments from 18 years ago told a story that we should NEVER be revisiting in 2006. That's what I found interesting in his column and what I found chillingly ironic.....

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  Or could it be that Detroit is just not building what these guys want to drive?  And could we have witnessed the seeds of resentment when the media felt THREATENED by GM's market dominance and decided to knock it down a peg or two?

Or could it be that for the most part Detroit is not building what the Average American wants to drive?

GM has lost about 15 points of market share since that article was written.

Your post sounds like something FOG would write. Well I will leave it at that...

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Hey, guys... I never said what Davis wrote isn't true. I never said GM didn't deserve to lose half its market share in the past 30 years.

All I said is that the car writers have been putting the same slant on things for just as long.

As far as the AVERAGE American is concerned....nearly one in three are still buying them, probably more still driving them DESPITE 30 years of carping by the media.

I just remember a time when reading MT and the others was enjoyable. I haven't bought one in several years, but I see them laying around and flip through them occasionally.

As far as FOG is concerned, I will take that as a compliment.

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  All I said is that the car writers have been putting the same slant on things for just as long. 

 

There is no slant. Nothing positive has happened as far as the average person is concered. Hint: Toyota has a market value of over $222,000,000,000. GM is 12,000,000,000. GM has been on a death spiral in the US for 30 years. What do you do, pat them on the back and say "good job" on another round of mediocre product.

The truth is, many of us have been waiting for GM to turn around for as many years. But in actuality we are always let down. If there is a slant that is it. And 18 years ago, there was hope they would do just that. 18 years later we still are hoping.

As far as the AVERAGE American is concerned....nearly one in three are still buying them, probably more still driving them DESPITE 30 years of carping by the media.

It is more like less than 1 in 5.

I just remember a time when reading MT and the others was enjoyable.  I haven't bought one in several years, but I see them laying around and flip through them occasionally.

The rags were only ever good for one thing, spy photos. And with the internet and CD/PB around, the rags are a waste of money.

As far as FOG is concerned, I will take that as a compliment.

Well, I will not take that one any further.

Edited by evok

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Ah, GM's market share is less than 20% now.....do you know something I don't?

Retail market share, without inclusion of fleet numbers is around 20%.

Simple math...At least 25% fleet sales and 25% market share means more than 5 points are wholesale rather than retail sales...(and both of those numbers are generously pro-GM, BTW)

Evok knows his stuff. You may not like what he or OC or I have to say, but our information is generally solid and the facts, unfortunately, speak for themselves. I think alot of GM fans suffer from a Stockholm syndrome about their favorite company...GM has squandered alot of people's futures and deserve every bad word they get, IMO.

Edited by enzl

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I am sorry for you both if you are that bitter and angry. Neither of you has even bothered to acknowledge my argument that the media doesn't have anything new to say. You don't find it amusing that they were carping about Detroit's comeback even when a comeback wasn't necessary?

A sale, even to fleet, is still a sale. SOMEONE is still driving the 25-27% market share GM is currently hovering at.

If it makes you feel better to go and buy a Toyota because someone in the RenCen has screwed up, then fine.

I, on the other hand, would never buy a Japanese car. I think Toyota and Honda build great cars, but they don't play fair. They hide behind the MITI in Japan and enjoy a closed market at home. The media has an axe to grind, plain and simple. I could bring up a hundred examples (most recently I mentioned the lawsuit against GM for their alleged 3.1/3.4 gasket problems was put on the FRONT page of the Toronto Star).

GM has screwed up, to be sure. I think we could all list a hundred things they've done wrong, but they've also done a hundred things right.

As far as resolving the issues from the last 18 years, that would be easy if the market/economy/consumer tastes didn't change, too.

And perhaps there is a disconnect between those on this board who work at GM (or Toyota!) and can only see the negative because they've "heard it all before," and those of us in the trenches who deal with real customers every day.

If given a chance, it can be easily demonstrated that GM builds competitive products. The consumer will listen and observe patiently. And there can even be small victories. I have personally driven people in a Cobalt and a Corolla to SHOW that the ride, handling, power and value is far superior to the Corolla.

The trick is convincing the consumer, who has to wade through the hyperbole and outright lies in the media, to actually drive the vehicle and judge for themselves.

I prefer to be a glass half full kind of guy. Sure, my livelihood depends on it, but if GM did go bankrupt and sell off its assets in Canada (as Texaco had to do), then I would get out of the business because I would never work for the Japanese.

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Retail market share, without inclusion of fleet numbers is around 20%.

CARBIZ: What he said. Actually I think GM is about 18% retail. As for your other post, well it speaks for itself. I might come back to it later if I have the time but really, it speaks for itself about what you know about the business and your ability to grasp what enzl, The O.C. and myself have been saying.

Edited by evok

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Why does this have to be a "death spiral?" Many American companies enjoyed virtual monopolies at one time, then were forced to reinvent themselves with new products/ways of doing things.

Look at Kodak. It was nearly wiped out a few years ago. Sears is another company. The department store market changed vastly in the past 25 years. Many venerable chains (in Canada it has been a killing field: Eatons, Woodwords and others).

There is no way GM could hold onto 50% market share. As far as I recall, GM was quite profitable until last year. There is no denying Toyota's emergence as a formidable competitor, just as Wal-Mart has shaken up the retail world. Like Wal-Mart, Toyota has come out of virtually nowhere in the past 25 years.

I think Americans are at their best when their backs are against the wall. Call me crazy, but I don't think it is such a bad thing if GM settles at 20% market share in North America, with Toyota and Ford maybe tied at 15-18%, then Chrysler, Honda, Nissan and Mazda pulling up the rear. It could be a healthy, thriving market for all.

But can someone please tell me why nobody else on this board even wonders why Japan is the only market in the world where there is NO foreign compeition?

Am I the only person here who thinks this is a concern?

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Why does this have to be a "death spiral?"  Many American companies enjoyed virtual monopolies at one time, then were forced to reinvent themselves with new products/ways of doing things. 

  Look at Kodak.  It was nearly wiped out a few years ago.  Sears is another company.  The department store market changed vastly in the past 25 years.  Many venerable chains (in Canada it has been a killing field: Eatons, Woodwords and others).

  There is no way GM could hold onto 50% market share.  As far as I recall, GM was quite profitable until last year.  There is no denying Toyota's emergence as a formidable competitor, just as Wal-Mart has shaken up the retail world.  Like Wal-Mart, Toyota has come out of virtually nowhere in the past 25 years.

  I think Americans are at their best when their backs are against the wall.  Call me crazy, but I don't think it is such a bad thing if GM settles at 20% market share in North America, with Toyota and Ford maybe tied at 15-18%, then Chrysler, Honda, Nissan and Mazda pulling up the rear.  It could be a healthy, thriving market for all.

  But can someone please tell me why nobody else on this board even wonders why Japan is the only market in the world where there is NO foreign compeition? 

  Am I the only person here who thinks this is a concern?

The Japanese partnership between gov't and industry spans an enormous number of sectors. It partially explains the difficulty GM and Ford are having, but the situation did not have to be this way.

At the end of the day, there has been a failure of imagination at the Big 2. An inability to recognize that the light at the end of the tunnel was an oncoming train.

There are 100's of examples of this myopic behavior, and I suppose you feel that critics have been unfair in doling out their venom. While I will admit that the press can be ferocious, the issue at hand is, that at the end of the day, they smell blood---two icons blood---and that can be a powerful force that invades lots of stories.

To me, this is about not giving them fodder to write the stories, but our domestic industry has been perpetually putting out mediocrity and also-rans...the Cobalt you speak of so highly is a nice car---but it replaced a Cavalier which, to be kind, was uncompetitive in 1992...how many people are going to hear it was replaced and run to a Chevy dealer---they all bought their perfectly adequate Corolla, Civic or whatever in 1993--were happy with it and have moved on to two generations of Accords, Camries or Siennas...the point being that they have NO reason to visit the local Chevy store anymore...

That's but one of a thousand examples of how GM put automaking second to money making and, now, they've got to figure out how to make cars again, no that they are no longer the default choice.

I'm actually optimistic they can do it, but time is short and severe action needs to be taken now! If my words on this board are a call to action for GM, great...if not, I'm OK with that too. (My livelihood is deeply effected by their progress, so I really have put my money where my mouth is. I have the right and reserve the right to speak my mind, even if others disagree.)

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Cliche'd analogies aside, those here with shall I say... pessimistic viewpoints might have better luck attracting converts if they addressed the facts less editorially.

In other words, to me "absolutely NOTHING positive" means exactly that: nothing. However, I cannot agree with that allegation and it unintentionally casts dispersions on everything else written. The discussion would be much more balanced if credit was given where due once in a blue moon.

-- -- -- -- -- --

On another front, what exactly are these same opinion-holders really looking for from General Motors? What would make you happy WRT GM? I am truely interested in knowning.

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Cliche'd analogies aside, those here with shall I say... pessimistic viewpoints might have better luck attracting converts if they addressed the facts less editorially.

In other words, to me "absolutely NOTHING positive" means exactly that: nothing. However, I cannot agree with that allegation and it unintentionally casts dispersions on everything else written. The discussion would be much more balanced if credit was given where due once in a blue moon.

--  --  --  --  --  --

On another front, what exactly are these same opinion-holders really looking for from General Motors? What would make you happy WRT GM? I am truely interested in knowning.

bla bla bla -

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Right... and "absolutely nothing positive" isn't exactly that.

Look at the continuing market share decline. Look at the continuing decline in share price, look at the continuing decline in profits.

Even in the better recent years, the profit picture normalized for RONA is in the 1-3% range.

Dismissing "wordsmithing", to the average vehicle buying public, GM has not consistently delivered world class product and buyers are migrating elsewhere. GM and world class are oxymorons. Positive means better than average, and GM at best in the US is average to the public at large.

If that were not the case this thread would not exist, GM would be making money in their auto operations, and market share would be improving.

And that, is not the case.

Edited by evok

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"Q -- GM has reduced production schedules, but your investories are still high. How do you view GM's production and market share (year-to-date 37@ vs. 41% a year earlier) for '87 and '88?

A -- I think our market share will move up, simply with the new cars we have coming out (such as the GM10 midsize coupes). Those cars are going to help us, but it will take awhile to get back up where we should be, and it may be '89 or even '90 before we're really on full load.

Q -- 40% by '89 or '90?

A -- I don't know. Let me say this: It's a strange thing, but I believe if the market goes down, our share will go up."

http://www.findarticles.com/p/articles/mi_...ai_6247173/pg_3

"A decade-long slide in market share is proof of that. Now, three years after Jack Smith's dark-days-of-1992 edict of "profits before market share," Mr. Wagoner declares the worst is over and share gains lie ahead. GM, he says, is sizing itself to claim 35% of the U.S. market, a share it last reached in 1991."

"

TCC: Can you meet the target you've set of achieving a 5 percent return on sales?

SMITH: We have two goals: margins and return on net assets. We're much closer to our target on RONA. That is coming along nicely. (Margins) are more difficult for us (because of) the pressure on pricing in the market. But it continues to be our goal, and in 1998, even after the strike, we hit 3.5 percent."

PS They never hit 5%

“We’re pleased to see the significant progress in our first-quarter results and in the implementation of all four elements of our North American turnaround plan,” Wagoner continued. “And we remain focused on accelerating our return to profitability and cash generation.”

http://www.thecarconnection.com/Auto_News/...S193.A1276.html

"Lutz Says GM Is Over the Worst,.."

Edited by evok

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