Actually, it went down due to poor quality steel (in other words, it was poor product). But product is not the problem, right? At least that's what you said here in the beginning and have since reversed your spin on.

 

Haven't we already discussed this to death? When you originally came here, you claimed you couldn't post your 20 steps because they were so sensitive you couldn't let other automotive companies see them. Ok fine. So everyone who was interested e-mailed you for a copy. Most of those who got a copy had many revisions, questions, or flat-out debunked the entire thing. You basically ignored negative feedback. You puff your chest out like you're the martyred savior of GM. And every time conversation dies down on this board and we return to some sense of normalcy around here, you post another thread to fire everyone back up...."Banned in Wilmington?" Ok. Now this new angle to stir the pot is actually posting the 20 steps for all to see. I thought this stuff was too sensitive to post in an open forum? Or, maybe it's a better tradeoff to get the attention back on the one and only Buickman.

You know where this board stands. We all want GM to be great again, we're just not sure if these 20 steps of yours will be the key to the revival. I don't see anything wrong with that...added to the fact that you come off a bit pompous around here....it only further drives down your approval rating on this board, which already stands at probably 5%. :blah:

 

The points were getting out anyway as many did not honor a request. The financial results for 2nd quarter were horrible, and it will be worse in the third. Since I originally came here, GM has done GMS to everyone and continued. It may be their undoing. Therefore I decided to "go public" with the first twenty and chose this site as the place to do so initially as so many members have been very insightful and helpful. I have received numerous emails of support. The few that disagree, or choose to be antagonistic, continue to "bash" me and my effort to improve GM. This really accomplishes nothing. Again, we should stay on task and debate the merits, or any weaknesses, in The Plan.

 

Pretty much the perfect summary.



I knew this would come up... so, please explain how you know that the Employee Discount to the Public contributed to the loss figure.

It very well may have, but as far as any of us know.... that loss figure could have been worse.... far worse, if they did NOT have the promotion. In other words, the promotion may have made shrunk the loss....

 

I swear, this is the herpes virus of this board.

 

In the 2nd quarter GMS hurt by the increased marketing expense of higher incentive cost and by the enormous ad campaign. GM posts revenue when the dealers receive the cars. Moving them off the lot brings in no additional revenue, only disbursement.
The larger exposure is in the third quarter if dealers do not replenish to the same levels, forcing production cuts. The dealers who anticipate a "payback" period leading into the winter will proceed with caution. If GM does not receive orders sufficient to meet planned output, watch out. I'm afraid the third quarter may be one of the worst on record, hopefully, I'm wrong.
IMO however, the greatest damage done is the further erosion of our image. It's become glaringly apparent to "Joe Public" that GM must "give them away" to move the metal. New product, new pricing may help but most likely we're in for a drought. According to Powers GM sold fewer conquest customers under GMS in June than they did in May. If we really have "robbed" our future, the price to be paid will reek havoc on our profit and cash position.
Short term thinking leads to long term problems. We instead need to change our thinking to long term, such as contained in Return to Greatness.

 

I am by no means an expert on this, so let me address some of your comments using what seems like common sense to me:

From what I've read, GM spend $39 (or something close to that) LESS per vehicle on rebate money in July that they did in June.... I would agree that there have been additional advertising expenses (it would seem so), but I think that would be offset or even overcome by NOT shutting down assembly plants, etc.

Fair enough. Did you (and most other dealers) order a lot of extra stock for the promotion? It seems like the word right now is that GM dealer stock is pretty depleted because of the promotion...

I suppose only time will tell on this one.... I think every promotion has a "hangover" period... however, I think GM picked a great workaround by offering this promo to clear out 05 models, and then reducing MSRP on most 06 models to compensate, and diminish their future rebates.... something I think you have been clamoring for... the reduction of rebates. Sometimes you have to position yourself before making a move... I see GM doing that.

I don't see it that way at all. Obviously the reponse has been TREMENDOUS in terms of volume of customers... Add to that the fact that many others have "copycatted" the idea, either on a corporate level or a dealership level... and I just think you are wrong. And, again, this was a great transition to lowering the MSRP's.

Think about it: If GM lowered the MSRP's for 06 models, in an effort to dimish the rebates, like YOU want for a better image....... exactly HOW would your dealership move out all the old 05 stock when they are MORE EXPENSIVE than the new 06 models?!


I thought JD Power said it was "slightly more" but not as significant as they thought. I also have read that General Motors disagrees with that evaluation.... I can't find the link to the article right now though.

Again, it's NOT short term thinking at all... I think they have PLANNED AHEAD for the transition to lower MSRPs for 06.

Good luck selling off your 05's when the 06's started rolling out without this promotion or something similar.

 

Rational reponse without personal attacks, now we're getting somewhere, thanks.
Most reliable sources indicate incentive costs rose $400. Remember it's not just the rebate or interest buy down. The reimbursement to the dealer must also be factored in.
Dealers were not able to order additional stock for this promo. We had to move what we had. Herein lies the nature of misguided marketing. Dealers who properly managed their inventory suffered from short stock. Some who had spent marketing dollars within budget were caught short in this area as well. Again, another example of the factory exerting undue influence over franchised operations. From the dealer management perspective it is extremely frustrating.
The Plan calls for a gradual, rational reduction in rebates. The idea is to slowly wean the public by replacing nightmarish, confusing programs with common sense offerings seen as consistent items of value. The "wide brush" angle of massive realigning will open the door to a huge risk. Remember Chrysler tried the same manuever a few years ago and was badly burned as they were forced to return to the rebate game, albeit at an already reduced retail pricing structure.
The matching programs from Ford and Chrysler were done out of necessity, not by admiration of a great idea. Imitation is a form of flattery, but in this case it's an exception to the rule, and really is nothing more than a response to GM's initiating a price war.
Hate to say this but GM doesn't have much credibility these days. (ie, Paul Ballew statement that gas prices are not hurting the sales). John Devine has lost much of his stature on Wall Street, hence the hiring of S Girsky, which really is noithing more than an attempt of calming "The Street".
Respectfully, I disagree about the "short term" nature of these current events. The move to clear the lots withing a couple months and replace with new product,new pricing within the next few, is truly a short term strategy. Enacting changes to the essence of our marketing is the kind of thinking classified as long term.
Your sincere hopes as to our success in the retail arena are appreciated. It's good to know that not everyone has it out for the dealer body.
Darth Xed, you have been one of my harshest critics, yet your style and attitude make accepting that criticism a challenge and do not illicit negative reponses which I would rather avoid as futile and tacky at best. We may not agree but you have my respect.

 

But in this case we can not only suppress, we can cure the disease if we choose.

 

Senseless.

 

I am so sick and tired of this cynical outlook. Thousands of buyers got a great deal on a world-class-quality GM vehicle in recent weeks thanks to the GMS pricing campaign. I'd bet that the vast majority are quite happy with their purchase and the value of the deal. Don't be so condescending to assume people don't actually know that GM's sticker prices are artificially high (a problem that is in the midst of being corrected BTW). Some foreign makes don't use heavy discounting... hooray for them (so what?). But overall - GM's discounting is not wildly out of line with the other domestic makes.

And Buickman... stop beating down us MBA's

As others have already said... I believe the 20-pt plan is horribly deficient in emphasizing the critical importance of hit products in the pipeline. It needs to be more than a 20-pt MARKETING plan.

 

When I get back from lunch, don't worry...he challenged this MBA in one of his previous posts, and he's gonna get it

Great product is the key issue he IGNORES, but I'll be getting back to that soon

 

This keeps going and going and going and going and going and going and going and going and going and going and going and going and going…….

And its getting worse than the SS vs Z28 debate

Which btw the Z28 won, just like BM will lose

 

I don't know why everyone is so let down by GMs current products, especially Pontiac. The revised bonneville, even though its on its death bed, is actually a really nice car, especially in the GXP trim. And for low $30k's, not a bad deal. The whole lineup of Grand Prix is pretty impressive and the price at least right now is unreal, you can nab a GXP for close to $25k!! I know the GTOs looks aren't quite as exciting as a Trans Am, but still an impressive car for $30K. The G6 is very sleek and the interior is fantastic. And with Soltice coming, that is gonna bring alot of people into the dealerships. I agree that Sunfire, Vibe (really a Toyota Matrix), Montana, and Trashtek aren't anything to get excited about, but they will be phased out. The Torrent, even though its a rebadged equinox, is a really nice small SUV. I would take a Pontiac over any Ford, Chrysler, Nissan, or toyota anyday. Toyota's are hideous in my opinion, I really think they sell soley on their quality and affordability. As far as quality goes GM is right up there with Buick and Cadillac. Not sure where Pontiac ranked, but it maybe could use a little boost. The cars that Lutz has been so hard at work on are just starting to come out. The next 4-5 years are going to be amazing for GM in terms of product. So Buickman may be right when he sees the need to focus more on the selling side of things. Look how well they are doing with employee pricing, at least in terms of marketshare. No more stupid rebates, or time constraints. I want a vehicle to be priced right, and competitively when being compared to other brands. I want to walk into the dealer and see an MSRP that I would be willing to pay and feel good about my purchase. I really think customers are fed up with rebates and how they change every month. Price the car right in the first place and it will sell. GM has billions in cash reserves, they will get thru this rough patch, but the time to price vehicles competitively is NOW!!!

 

Please remember the steps announced in the first twenty addressed marketing as that is most easily, and quickly, correctable. Never have I said product was not important. In truth if you saw the AutoLine Detroit show, you would have seen my emphasis for the need for product at Buick.
As to MBA's, I am a firm believer in higher education. The trouble is with the few who use their degree as a defense for their incompetence. It doesn't make them stupid, just lacking knowledge in certain areas. Simply possessing a parchment is no assurance of all-knowing wisdom.