GM to scrap Oldsmobile division

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General Motors Corp. will phase out its unprofitable Oldsmobile Division in the next few years to focus on its other brands. The car giant said today it failed at attempts to woo enough younger, import intenders to justify sustaining the brand, which is more than 100 years old. GM said Oldsmobile advertising will switch from brand-focused to promotional. The news comes in the midst of Oldsmobile's shootout for a major first-quarter divisional brand assignment between incumbent Leo Burnett USA, Chicago; African-American incumbent E. Morris Communications, Chicago; and McCann-Erickson, Troy, Mich., and New York. An Olds spokesman said the review is proceeding as planned, even though the ad focus will change. A decision is due late this month. Olds slashed its ad budget this year to $92 million in measured media in the first half from $330 million for full-year 1999, says Competitive Media Reporting. Its vehicle sales slipped 18.5% through November, Automotive News reports. GM also announced it will cut a total of 15,000 jobs in North America and Europe, with 9,000 in the U.S.

Copyright December 2000, Crain Communications Inc.

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