Ten-point plan to repair GM

So far, as we all know, the Big Three are now the Big Two. Chrysler, once the weaker of the three beasts, has filed for bankruptcy and only two are left. Ford seems to be doing a good job, in fact, they sold more than Toyota in April. So now GM is close to hearing the death knell. But don't be afraid, because this is my ten-point plan to reassign the medal to a powerful general.

Mind you, this isn’t a plan designed to save GM from a very likely bankruptcy, as that would take an angel from car heaven to flip a switch in everyone’s head so that they suddenly buy American. Rather, this is a plan designed to fix GM, and to ensure that the General’s current predicament will never happen again after GM bounces back. Also keep in mind that this is a plan only for GM North America (for I propose cutting Buick, which would alarm the reader living in, say, China).

UPDATE: Well, looks like this is strictly a plan to fix GM after recovering, as the (once) powerful General went into bankruptcy today. Strange and scary times we are living in

1) Keep Pontiac

I’m still reeling over GM’s decision to axe Pontiac. Next to Chevrolet, this is the brand that has the highest potential to make money! After all, look at all the effort GM has put into this brand. They’ve spent all that money developing the Solstice GXP Coupe, the Pontiac G8 and variants, and now they are going to just kill the whole thing off? That doesn’t make sense. What’s more, the decision to return to the four “core brands” of GMC, Chevrolet, Buick, and Cadillac does not make sense either. Chevrolet and Cadillac should be kept, of course, but GMC and Buick? Neither are making GM enough money to justify their continued existence, and neither fulfill a market that the other two (Chevy and Cadillac) can’t.

2) Cut models, not brands

It’s necessary to do what you can to conserve cash in a financially hard time, but GM is going about it the wrong way. But this should have been obvious. When you cut an entire brand, you cut all of the models, regardless of whether they make money or not. By cutting specific models, however, you can pick and choose, and weed out everything that is non-essential. If it was me, I would cut everything in Pontiac except the Solstice and G8 (and their variants), the useless Colorado, HHR, Impala, Equinox, and Trailblazer from Chevy, either the STS or DTS (or both) from Cadillac, the Lucerne from Buick, and everything from GMC except for the Sierra and Acadia. I’d even keep Saturn, just weed out everything but the Sky, Aura, and maybe even the Vue. But Hummer and Saab have got to go.

3) Ditch the Volt

This may seem like a shocker, but it’ll make sense if you think about it. The much-ballyhooed Chevy Volt sounds like a great idea, but it’s really nothing more than a publicity stunt. I’m not saying that it isn’t applicable, I’m saying that it won’t make money. And all GM needs right now is money. The reason it won’t sell is because of its price. No matter how advanced it is, no one in America will spend $40,000 on a small Chevy sedan. It’s just that simple. And Bob Lutz has already announced that even at 40K, GM won’t make a nickel, because the technology is so expensive. Solution? Ditch the Volt, but make the Cadillac Converj. The Converj is the same thing as the Volt, only dressed up in Cadillac style and swagger. One of the sexiest concepts GM has ever produced, it will not only be a huge image car, but also has sales potential. Why? Because while GM can only charge $40K for the Volt, it can charge a lot more for the Converj, due to the brand. And while people won’t pay that much green for a simple Chevy, a surprisingly large target consumer base has the cash and the desire to pay up to $60,000 on such a nice Caddy. The end result? GM will still make money on the whole Volt idea, but will also please the airheads in Congress and boost its self-image.

4) Create an aftermarket division

The aftermarket demographic is huge, as proof, just listen to that ricer roaring down the street. What GM needs to do is tap that market. Take the models that will be modded, and offer everything tuner markets do but at a lower price, with a GM backed warranty. Not only will buyers flock to dealers, but this will also give GM a leg up over the competition, because no one else has it yet. Divisions like AMG, M, and SVT don’t count, because they are for the high end performance models. GM’s aftermarket division will be for the common car buyer, while offering aftermarket mods such as body kits, grilles, wheels, interior kits, performance mods, etc. at a lower price than private companies with a company backed warranty.

5) Create an exotic division

My idea of creating rather than destroying brands seems completely out of sync with what GM is doing, but that’s because what GM is doing is wrong. Cutting and consolidating is only happening because the stock holders and upper brass of General Motors are scared and are only looking after their own retirement funds, and are searching for a way to secure them by being cowards and retreating from action. GM will not survive this way. It has to take a gamble, and reach out with everything it’s got, and hope that the world will respond. Which is why GM should create an exotic division. This division would be the dream car division, and would host models that directly take on the likes of Ferrari, Rolls-Royce, Lamborghini, Maserati, and the other uber-exotics. And I’m not talking about models like the Corvette. While it certainly is world class, foreign competitors still see it as a lower breed. GM needs to build cars to combat the aforementioned brands, but on their terms. It don’t think there is any dispute over GM’s ability to build beastly cars. But these news cars will need to be flawless, they need to be luxurious, they need to be elegant, but above all, they need to be insanely expensive and be worth the price.

6) Have aggressive commercials

Believe it or not, but commercials have a huge impact on what people buy. More than anything else, commercials spread the news about a certain product, and when done right, they all but guide the viewer to the nearest dealer. So GM needs to utilize commercials. Stop with the boring, typical stuff. Stop advertising the cars that no one cares about. Instead, advertise the cars that get viewer’s blood pumping, that get them excited, that get them motivated. A crazed human being will do stuff they wouldn’t do otherwise, and GM needs to take advantage of that. And as the final coupe de grace, they need to take these hormone inducing cars and crush the competition with them. Attack the competitors. Slam their faults while glorifying your merits. Take the Camaro and show it thundering ahead of the Mustang and Challenger. Play soft gentle music when showing the M3 ambling along, and play loud crashing rock music when showing the CTS-V blasting through a curve. Stop showing the Malibu slowly rotating on a stand with a calm narrator and start showing the Corvette tearing up a track with only the scream of rubber, the roar of the exhaust, and the howl of the engine for narrative description. Stop showing a man or woman calmly talking while driving in a CTS, instead, show an ultra-smooth dude coming out of his CTS at a nightclub and picking up three hot, sexy girls right on the spot. Emphasize beastly-ness, emphasize sex appeal, show on national television that not only is your car the one to buy but that there is no better, and you have the nation’s viewers in the palm of your hand, and what’s more, you have their cash, too.

7) Build the damn concepts

I have lost count of the times when GM has a great concept and they can it. What GM doesn’t seem to realize is that concepts generate the greatest public interest, and by association, the greatest possible revenue. Just look at the huge response when GM showed the Camaro concept at the 2006 Detroit show. And when the public is all pumped up for a great concept, they get pissed and disappointed when they find out that they’re not gonna be able to buy it. They will be dissatisfied, not only with the decision, but with the company itself. And a dissatisfied customer tends to stay that way. So next time you do roll out a hot ride, those people who were pissed before are less likely to buy.

8) Charge more money where possible

GM needs money and one easy way to get it is to charge more. Not on the normal consumer models, as that would enrage the public, but on the cars that are already very expensive. Simply make the car a bit more appealing and charge a heckuva lot more. Take the Cadillac XLR, for example. Sharpen up the design, sharpen up the interior, increase horsepower, and generally just fix the little complaints that people have with it to make it more appealing. Spend about $5,000 in changes and charge up to $15,000 more. The trick is to make it seem like it’s worth it. Glitz up the exterior, shine up that chrome, use red stitching on the black leather and viola- Mr. Rich But Dumb Joe thinks he has the best deal ever. It’s a dirty trick, yes, but when your very survival is on the line you had better be prepared to do whatever it takes.

9) Speed up the bureaucracy

Right now, the whole process of making a car is just way too slow. From concept to production takes about 10 years, which is insane. That’s due mainly to the bureaucracy, where power over decisions is spread way to thin. What GM needs to do is centralize. Have one man be in total control of a specific area, and make his word law. If he wants something done, then it gets done. No bickering, no discussion, just direct action. By cutting out all the bureaucratic crap, I’m willing to bet that the process from concept to production could be more than halved. And that’s important, because in order to maximize sales, you have to take advantage of the period when your car is the craze. If you can sell a car at the exact time when people want it, then you’ll be netting in huge profits. Like I said before, when people are fired up, they’ll do anything. If a man is caught up in the Camaro craze, and he’s got the cash, he will buy a Camaro. But wait too long, like GM did, and the initial surge of interest will have died down, and you lose money in the long run.

10) Break the Union

This last point may be the most critical. If the union is still alive, none of the above points can be managed in the required time. In fact, I accused the union of bringing General Motors to the brink of anarchy and bankruptcy. It is precisely because of the existence of the union that GM cannot advance at the required speed. Therefore, in order to revive GM, the general must first break the backing of the union. Once it is broken, it must be guaranteed that it will never come back, or if it does come back, it will never recover the power it once had. The union here is the key, because without it, GM can do more. Generals can be automated, can get rid of bureaucratic nonsense, can speed up production, make marketing more effective, can prevent cowardly behaviors now taken by senior leaders, can take risks, and can do it once and for all before being dragged down by the alliance virus.