The editors at Edmunds' Inside Line have graciously given me this virtual space to write about virtually anything I want, so I thank them for the opportunity, and I'll tell you how I'm going to use it.
What follows is a to-do list for General Motors for 2010. It's technically not a list of New Year's resolutions, because that is such a trite and tired format...and, what's more, New Year's resolutions are rarely, if ever, kept. These are things that GM can, must and shall do this year. So, without further ado....
1. Remain focused on the product above all else.
GM builds cars and trucks and crossovers. That is what we do. In 2009, we were given an opportunity to continue doing so, and we must not squander that opportunity. Therefore, we are resolved, if you will, not to lose sight of the fact that if we don't build the best cars, trucks and crossovers on the planet, that opportunity will go for naught.
It may sound simple, and you may think it would go without saying, but it's hugely important and it's the most essential element that all of us here need to keep top of mind as we begin 2010.
2. Remain focused on the product above all else.
That's how important it is. I'm listing it twice. After that edict, the rest of this list is not going to be in order of importance. And, you could argue that we can't just be great to win consumers. With our image challenges, we've learned the need to be exceptional.
3. Change minds.
This is the big one. It's the most important thing we have to do, other than #1 (and #2). We have to make more people aware of what's going on in relation to #1 (and #2).
Let me digress for a moment and say that I've seen it written that GM's marketing strategy is based on the fact that the consumer is too dumb to know what great vehicles it makes. I take huge issue with that. That's an example of the media trying to ascribe some of the old GM arrogance where none exists.
No one at GM has said that every vehicle we have is world-class — we still have room to improve.
It's not arrogant to think you have great vehicles, so long as you do, and to try to spread the word about them. No one at GM has said that every vehicle we have is world-class — we still have room to improve. And no one at GM, including me, has said that the consumer is too dumb to realize how good our new products are. All we've said is that the consumer perhaps is unaware of said fact. That's a far cry from being dumb.
And the typical consumer's unawareness is a result of one of two things. First, the consumer literally may not know about our products and what they offer; or second, the consumer knows of them but chooses not to consider them, for a variety of reasons ranging from a bad previous experience to a relative's bad previous experience to a neighbor down the street who has a relative who knows someone else who had a bad previous experience. In short, it's reputation.
We face an enormous reputational deficit, one that took decades to develop and one that, unfortunately, we earned. And it's going to take a long time to turn it around, but we certainly can do it. That's what our satisfaction guarantee and "May The Best Car Win" campaign were all about. Those are just the first steps to putting consumers on notice that we believe in the appeal and quality of our vehicles and we feel they deserve more consideration than they're getting. And increased GM consideration numbers from here at Edmunds and other sources show that the campaign was a very good first step.
From here, the plan is to continue to put our message out there, aggressively, and take away every last excuse people have for not trying a Chevrolet, Cadillac, Buick or GMC product. We're stepping up our marketing and communications spending to ensure that, and we'll be reaching more and more consumers, especially on a grassroots level, to make sure they make an informed choice when they decide upon their next vehicle.
The best and perhaps quickest way to improve a reputation is to improve relationships with customers, because that is the nature of this business. You want customers to fall in love with your vehicle the moment they lay eyes on it, and you want them to stay in love with it when they own it. One customer at a time, one vehicle at a time. You can change the opinion of generations that way.
4. Be vigilant about quality and technology.
Of course, if you don't have the quality, reliability and durability dialed in, that's what destroys relationships and reputations. We know that as well as anyone, and other companies have also found out (or will find out) about this the hard way. We will be vigilant about quality, as well as leadership in advanced technology and fuel economy — we'll have new entries in the small-car segment that are aimed at best-in-class.
As we ramp up in the new year, we face a lot of challenges in adjusting to fewer brands and fewer nameplates and moving ever more quickly. We simply cannot afford to let things slip in the process; we cannot overlook one detail that would adversely affect quality, reliability and durability. One step up and two steps back gets us nowhere.
5. Design is still king.
I've been saying this ad nauseum for years now, so I don't feel the need to go into great detail. Suffice it to say that, like quality, we cannot afford to let our guard down on great design. It's not a difficult concept to grasp: The only way to turn an auto company around is to build vehicles that people want. Period. And the only way to build vehicles that people want is to design them so they look good. Period.
That's not to say that's the only criterion. See quality, reliability, durability and reputation, above. But you can have the world's best quality and the world's best fuel economy and the world's longest-lasting vehicles, and if all that comes wrapped in ugly boring packages, you won't sell any.
I'm proud of the strides GM Global Design has made in recent years, and the awards we've won show that people have noticed. And we will continue to put that message out (see #3). Just as we will continue to empower GM Global Design and give it the freedom it needs to create. Ed Whitacre, Tom Stephens, Ed Welburn and I are in lockstep on this one.
That's the beginning of a pretty good to-do list. There's a lot more. Continue to pursue leadership in advanced technology and the electrification of the automobile, get the Chevy Volt on the road, pay back the loans on or ahead of schedule.... I could go on, and I will go on, just not in this space. I should also point out that all of these things, and more, will be done against the backdrop of developing our four brands to their full potential.
We realize, and this may be a little inside baseball for you, that "General Motors" itself may be what someone could label a "damaged brand." (Someone might say that, but not me!) Even if that were true, and it may be, that alone would not be the reason we would choose to emphasize our brands more than the parent company. The reason for emphasizing the brands is that we're proud of them, and their heritage, and their vehicle lineups, and what they represent: a glorious past and a potentially bright future.
Besides, there may still be that one person out there who says, "GM? They went bankrupt! Took money from the government! I'm not buying any GM car! Chevrolet? Yeah, Chevrolet's OK. American car, right? I'd look at a Chevrolet..."
I'd put that guy in an Equinox in a heartbeat.
Add A Comment »
jerome7 says:
01:48 PM, 02/13/2010
If the comments attributed to Mr. Lutz re: the fact that hybrids will never constitute more than 10% of the autos sold by GM and others are true, I would say two things:
1. Mr. Lutz is out to lunch. By the end of this decade hybrids and/or electric cars will constitute the majority of cars sold in the industry.
2. Since I live in a world where the survival of our species depends on our collective ability to stop poisoning the earth and sky which Mr. Lutz doesn't seem to recognize, theen I consider him and GM a threat to our survival. I am planning to buy a new car this year and Mr. Lutz' attitude convinces me that it should not be a GM car. It won't be.
greenmatt says:
05:10 AM, 01/25/2010
If you want to start fixing your reputational deficit please sell SAAB.
johnferinal says:
10:28 PM, 01/18/2010
6. Try to come up with technology which help their vehicles attain the advertized MPG.
deadviper says:
11:43 PM, 01/15/2010
1. Fix the vette. Kill that poser edition Chav Sport and do something about that interior. No reason why the Malibu, a $22000 Toyota Accord clonetrooper should have a better interior than the vette.
2. Fix the Impala. Enough with that FWD crap. You wanted a car to beat Toyota and Honda with and you have it in the Malibu. Now give us back our $30k RWD 4-door performance car. Don't say there isn't a market for that either, because there is. Don't say 'we tried that with the G8' because the G8 was being sold under a damaged goods brand and one great car couldn't have saved it. Rebaged M5s for $15000 couldn't have saved it.
3. Whatever your doing with cadillac, save for the CTS-V....stop. Just stop. You promised us a cadillac that could take on the germans. Certainly you don't think you can fullfill that promise with that weak XTS, a car for the technocrat that has resolved to spend his life slowly turning beige. The DTS's typically ancient customer base will love it. The Acura buyer swept up in the 'buy american' tidal wave will love it. No one else with a pulse will take notice and bravarias executives will rest easy for many more moons knowing they only have to worry about japan. Get the people who gave us the cein and the sixteen back to that drawing board giving us the world beaters caddy has the potential to deliver.
4. The new Focus is going to make life tough for the cruze, so...well isn't there some trick we can pull out of the hat here? 4wd? more base HP? an SS edition that doesn't break the bank? a diesel hybrid?
intothewest says:
08:35 AM, 01/11/2010
@icecubefosho - You might be the dude Lutz is addressing (re: not truly aware). I'm not a huge GM fan (they're coming along! But, until then, I'll be keeping my 3 Fords), but your comment about the "SS models should mean something" is a little strange. Despite maybe a cheap look, the Cobalt SS was a rocket - and in one of the major magazines, even beat an EVO around Laguna Seca. In fact, I'll go as far as saying it might have been one of the best and underappreciated FWD performance cars of the last 10 years. As for the other "SS" out there now - the Camaro SS - well, you'd have to be stuck in a closet to not know what that car is capable of.
charlesb says:
10:51 PM, 01/10/2010
This guy is a dinosaur. I'm sure that he must be one hell of a confidence man though to keep talking his way to a place at the table. I sense some senility creeping in though because his first two points were the same. G.M. needs to get costs under control because if the product isn't competivively priced it won't sell.
stewy3572 says:
04:54 PM, 01/10/2010
I'm sorry, but I don't think GM/Bob understands its customers all that much. I say this after having the 'pleasure' of driving a 2009 Chevy Aveo 4 door for the day. This was a horrible little car to drive but didn't need to be. I kept wondering, who would buy this new? (other than Enterprise!) When there's the Honda Fit, Scion xD or even a Kia Rio5 available. I then thought about this article, and how this crappy little car was evidence of the problems GM has.
I think I was in the 1LT version which starts at $14,100 - power nothing, 4 seats a steering wheel (vague though it was) and a couple of pedals for stop and go. It was also boring to look at. At least it had a AUX port! But that was the only highlight inside - the single cup holder was placed in the middle of the car behind the driver seat, meaning you had to nearly dislocate your shoulder to reach it. And when you spill said beverage, you'll be happy to find an extra power outlet facing upward only a couple of inches away, ready to catch what ever it was you spilt. It made me wonder if anyone in GM's design team had ever actually driven a car before.
I've owned a few small cars - I had a 2006 Kia Rio5 which was way better than this. Today, a Rio5 with the same options + power stuff only costs $75 more than the Chevy - The Rio has a better warranty + it has 15" alloys + it isn't that bad to look at either. The 2009 Honda Fit with the same options is $16,500 - but the extra is worth it - it's better looking, built better, more practical and doesn't depreciate as much etc etc
If GM/Bob are going to compete and win. I think they need to put the same kind of energy they do with cars like the most recent Camaro into the every day cars most people have to drive. They need to put at least a little desirability into every car they make - yes it is possible to actually 'want' a small car - ask anyone who drives a Mini (which starts at $18,800 - and still worth the extra over the Aveo)
Same goes for Chrysler - Ford on the other hand I think get it. The new Fiesta looks great! (Did anyone see Top Gear's Clarkson film using the Ford Fiesta? Brilliant!) Maybe Chrysler will slap their badge on a Fiat 500 and bring it over here - sell that starting at 16K and you'll give Mini some competition.
(pricing info obtained from www.Chevy.com / www.Kia.com / www.miniusa.com / www.Honda.com)
domking says:
07:12 AM, 01/09/2010
Mr. Lutz, paying Howie Long to make fun of a Honda lawn mower tells me that you think the American car buyer is stupid. Slick marketing campaigns and celebrity endorsements are an expensive, risky, and short-sighted way to sell cars. Slash the marketing budget and use the money to improve the cars. This is how people buy cars today: A 25 yr old sees a 2009 Subaru WRX STI drive by him on his way to work, his jaw drops. Once at his desk he logs on to Inside Line or Car and Driver and reads the latest reviews of the car, he begins to salivate. After work he goes to his nearest Subaru dealer and buys one, full price, no discount. Subaru just made a high margin sale and it cost them $0 of marketing/advertising. After six months, he tells his friends how thrilled he is with his purchase, they go buy one too, or maybe just the WRX version due to budget issues. More sales, $0 of advertising/marketing. The same scenario is repeated for a 35 yr old who sees (and hears) a BMW 335i or Audi S4 or Infiniti G37 roll buy. This is also how Subaru Legacy's are sold, Toyota RAv4's, Nissan Maxima's, Honda Civics, etc. Then, the customers come back for an upgrade after four years because their car has given them a terrific ownership experience. Maybe it's me, but I do not know of one person who buys cars because of the TV commercial or the full page ad in the newspaper. It's easy to talk about making the product your priority but it's another thing to believe it. When I see how much money GM spends on marketing while still building cars with horrible interiors (yes, the current models too) it leads me to conclude that the people at GM are not yet true believers. Talking the talk is easy, walking the walk is the hard part. Having said that, I'm still rooting for the American car companies.
bobbygm says:
01:46 AM, 01/09/2010
To jlflemmons (the person with the '04 Yukon). I can't speak of the history you have had with your truck or the history it's had with you. Personally I do not have the model iteration you do, but know many who do and they are fine vehicles and have no complaints.
Moreover, the next time your driving around take note how many of the original Yukons are on the road. This would be the model iteration prior to yours, which is second generation. They are numerous, solid and clean burning. How many older Expeditions, Titans, et al in that class do you still see driving around? Not many at all.
I have a '08 and the machine is supurb. I would buy another in a heart beat. This opinion comes from a guy who has had ten Hondas (12 if you add the power equipment, which Louie Long likes to point out in his Chevrolet add) and an Acura. So I know all about the domestic vs. American quality analysis. There is no doubt Honda for example builds a fine vehicle, not to mention power equipment, marine engines, motorcycles, jet skies, ATVs, and a jet (see Hondajet) and even a robot. Take that Toyota. But my GMC holds its own and more to anyone of those vehicles that I have had in terms of quality. It's true they are different vehicles, but on the issue of quality can be equally measured.
If the customer is the final arbitor look at the sale numbers between the Tundra and GM, Ford an Dodge. The big three have six figure sales figures for their fullsized trucks compared to five for the Tundra. This says it all.
It's true that the American auto industry in the past has had some quality issues. I atribute this in large measure to the unfortunate shackles applied by the UAW (2k per unit for benefits). I wonder how the quality has caught up or improved to the point it has with this huge liability around its neck, which still remains if not worse since the gov't turned over 1/3 ownership to UAW.
Arogance and complacincy on the part of industry managemnt was also a factor. I believe this is behind us now.
Lutz is right in his points. The brands are great and will succeed.
And to all you Ford fans! They have some good looking products, but when standing toe to toe with GM there is no match. After four Explorers (yes they had their chance with me) I had to depart. Copious quality issues with finishes, early onset corrision and squeaky front ends on all caused me to depart the brand.
I hope Ford does well with their new line up. It's sharp, but quality has to be there or why bother.
One final thought to Lutz... Stay in there. We need you and people of your ilk. Someone at your station in life after giving so much to this industry and nation could be long retired and reaping the rewards of a sucessful career. But you stay in the fight because you love the business and care about it. There are are few if any car guys left in the auto industry who are as passionate and concerned as you. People like you are dearly needed to stand between the beloved American auto industry and the crowd in DC and at Wall Street. These pencil pushing; calculator punching; lap top lap dancing; Brooks Brother and Polo wearing; Blackberry addicted; cellphone jockies "I'm so important and signiifcant;" Audi, Bimmer and Benz driving; Sushi eat'n; quarterly return blinded; myopic elites don't have a clue about the American auto industry. They have little regard if any for its history, importance and strength it adds to this nation. They figure, "so what, can't they build those conveyances in China or somewhere?" This group is the biggest threat to Detroit in concert with the the next group, the environmentalist.
The envirnomental movement will not be pleased until we are all driving around in solar or wind powered fully protected modules on bicycle wheels. This crowd has frightened the auto industry from Japan to Detroit. If your auto is not respresentative of the green movement you are dangerous to planet earth.
Look at the next gen F 350. As much as a fan of the class vehicle it is, I am unable to see how it would be considered green sensitive. Not there is a need to do so. But for argumet purposes it is not. But Ford has a little green leaf emblem attached to the sides. Why? It's the fear factor Ford and other manufactures have about this crowd in that they must be recognized and acknowleged.
No they don't. Ford and others. Invest in some brass and stand up!!
Personally I believe the little green leaf emblem is Ford's way to protect the prospcetive owner thwart off environmental terrorist from tagging it while it's parked along a street in the Peoples Republic of Cambridge, MA while its union contractor owner is working inside MIT on a new laboratory that is being constructed (with Stimulous dollars from Obama) for solar energy research.
To this group I say this. Al Gore show us how it is done. You can post the findings on the Internet that you invented. Remember?
rghojai says:
09:36 PM, 01/08/2010
Rather a plethora of propaganda, an avelanche of an advertorial... . This tells us absolutely nothing.