Posted by: David Welch on April 01, 2010
They came one after the other over the course of about 15 minutes, four press releases teasing us with big sales gains made by General Motors. First, a press release at 9:54 a.m. today saying that Chevrolet sales were up a whopping 41 percent. GM offered no more detail. We’d have to wait until 10:45 to get the goods. Two minutes later, Buick is up 76 percent, said the release. Then it’s GMC up 45% and finally Cadillac up 42 percent. It was a cunning move since GM knows that in news cycles where the delivery of data bits and sound bites is measured in seconds, the wires would simply post those headlines and get the details later. They dutifully did just that.
So for about an hour this morning, GM had some juicy headlines out on the news wires boasting whopping sales gains for its four remaining brands. Looks like a good month, right? Well, when the details finally emerged it wasn’t such a great month after all. Remember, this time last year the economy was reeling from the financial crisis. The car market was at historic lows and GM was gliding straight toward bankruptcy court. So March 2009 is an easy comparison for the writers of press releases.
Once we could dig into the numbers and ask some questions, GM didn’t exactly hit the cover off the ball. Marketing Vice President Susan Docherty said that sales to corporate and rental fleets were up 64 percent. Fleet sales tend to be less profitable since carmakers often sell those car to rental agencies at a discount. Sales to Pontiac, Hummer, Saab and Saturn, which are all being killed off are sold, plummeted and GM hasn’t been able to recoup all of the buyers. The bottom line is that GM’s market share fell to 17.6 percent, down from 18 percent this time last year and well off the 18.7 percent pace the company has set for this year.
The company does have some great new models. The Chevy Equinox, GMC Terrain and Cadillac SRX SUVs are hotter than a two-dollar pistol. So is the Camaro (pictured above) which outsold the rival Ford Mustang 8,900 to 5,900. Even Buick has a hit with its LaCrosse sedan. As fast as those cars are selling, GM needs to get more people to give those four surviving brands a look. Otherwise, Chairman and CEO Ed Whitacre’s unofficial target of 20 percent market share by the end of this year will be a mirage. Today’s play was cunning. But it will take more than PR schemes to convince GM’s skeptics that it has turned things around.
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