'New' GM Seems Unwilling to Make the Toughest Cuts

An Ad Age Editorial

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GM CEO Fritz Henderson announced earlier this month that the automaker will launch 25 models between now and 2011. When Ad Age called the company following that announcement to ask whether this was too many new products to effectively take to market, the first reaction from GM was that we were reporting an "old" story.

Absolutely right, it is an old story. It is a big part of the sad story of how the giant twisted itself into such a mess in the first place. Terrible, or frankly nonexistent, brand-portfolio management left the old General Motors with too many indistinguishable models and dozens of others that competed head on with siblings in already overcrowded markets. Unfortunately, however, it is in danger of being the new story too, with post-bankruptcy GM shaping up to repeat the mistake.

Sure, GM has made headway by shedding Hummer, Pontiac, Saab and Saturn, leaving just four brands -- Chevrolet, Cadillac, Buick and GMC. And it will reduce its number of models to 34 from 48.

But it still doesn't exactly seem like a recipe for focused marketing, especially not in an era in which brands are so obviously owned and shaped by consumers. (GM is, in effect, betting that it can give consumers 34 different stories explaining 34 different products and have them understand and repeat the same stories.)

Just as there was nothing wrong with the domestics taking a few pages out of foreign automakers' production text books, there is nothing wrong with learning from their brand-portfolio management -- and none of them has four separate brands with as much overlap as GM has. And it's unlikely any of them, finding themselves in GM's financial condition, would try to launch 25 models in the next two years.

Sure, we have to admire the ambition -- and media owners will be salivating at the prospect of all those launch ads -- but there's also a niggling feeling that GM missed the opportunity to really reimagine itself as a focused marketer, overseeing a coherent brand portfolio of fewer models, each properly defined and supported.

We like the focus on product quality -- the vehicles are clearly improving -- but fewer products would've been a better bet.

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