If You Were Wondering What GM is Planning for Pontiac and Buick--Read On.

Posted by: David Kiley on May 19, 2005

General Motors sales and marketing chief Mark LaNeve stopped in today and had this to say about GM’s most problematic brands—Pontiac and Buick.

“Everybody asks me if I think we have too many brands? The answer is No, but we have to manage them a lot better.” Buick and Pontiac have been decliining for years. These are not 21st Century brands, if you ask me. LaNeve admits that if GM is going to grow its market share, it won’t be through Pontiac and Buick. Market share stabilization, and maybe a bit of growth, will come from Chevrolet, Cadillac, and Saturn. Sales stablization and likely decline is the best they can hope for with Buick and Pontiac, he says. But they have to make the brands more profitable, even as they get smaller. That’s refreshing. Usually, GM and other companies don’t ‘fess up that some of brands are not being managed for sales growth.

GM, which began closing down its struggling Oldsmobile brand in 2000, has been quietly combining Buick, Pontiac and GMC dealerships into one channel. Some 80% of GMC-Pontiac sales points are combined and 50% of Buick sales points are already combined with Pontiac and GMC.
That channel, which will be nearly 100% combined in the next few years would, today, be the fifth largest channel of car distribution in the country.

GMC trucks and SUVs will be the bread and butter of this channel. Buick and Pontiac would each have only about four core models per brand, says LaNeve. And most important—no stupid overlapping products. No Buick Ranier SUV, which is copycat of the GMC Envoy. No Pontiac Grand Prix, which would be in the same segment as Buick sedan at a similar price point. No Buick Rendezvous SUV and Pontiac Aztek in the same dealership. “All this is Marketing 101,” says LaNeve. “But we have had to keep learning it over and over again.”

LaNeve thinks of the future of Pontiac and Buick in terms of MINI and Porsche. MINI only has one product today, but that’s expected to change within a few years where it will have at least two and perhaps three. “And everyone is clear what a MINI is,” says LaNeve. “Porsche, too…what do they have…three or four core models, and noone is unclear about what Porsche stands for.” “We can do that with Pontiac and Buick over time. Take down the model offerings to ultra focus them on maybe four models at the most per brand and make them part of an overall portfolio of GMC-Pontiac and Buick at one dealership facility.” He also says to look at Hummer for what GM is out to do. Three products at Hummer now, including the original H1, with a possible fourth, and everyone is crystal clear what Hummer stands for. That’s the way we are going to fix Buick and Pontiac.”

If you will allow me this analogy: I do a lot of gardening and I know every Spring, early, you have to clip the rose bushes just right if you want healthy roses and strong blooms. If you dont prune away the dead wood just right, the plants suffer. This is what LaNeve has in mind. It seems like a reasonable strategy going forward if they execute and are serious about saying no to their own executives who want every brand to have a minivan, roadster, sport wagon, etc.

One idea LaNeve was intent on leaving behind during his visit: “We are not looking to cut any of our eight brands.” And he’s not keen to see the number of models go down much either—suprisingly. Taking down three models between Buick and Pontiac, he says, may well result in three being added between Chevy and Cadillac where the growth is.

Laneve earned his stripes and two big promotions in the last eighteen months by fixing the marketing of Cadillac and making some smart product decisions. Rick Wagoner is counting on LaNeve to make sense of the rest of the GM brand stable.

Reader Comments

Joel

May 20, 2005 11:05 AM

I'm currently interested in two cars from Buick (Lacrosse) and Pontiac (G6) so it will be interesting to see as GM consolidates and updates all the vehicles within those lines.

rocket

May 20, 2005 11:39 AM

Well said. LaNeve has finally made sense of the core GM brand structure. Funny, to me, is that in all of the free advice that has been pouring GM's way over the past 6 months I never read or heard a single suggestion along these lines. Turns out, they do seem to have the right guys at the top.

Robert Farago

May 20, 2005 3:49 PM

Rocketboy

May 22, 2005 4:04 PM

At the risk of being picky, there are a heck of a lot more MINIs than just one type. There's the Euro-Asia only MINI One, and OneD, there's the Cooper, and the supercharged Cooper S. And then the convertable versions of the Cooper and the Cooper S. And they are marketed and sold as different cars, not just different trim levels. That being said, it's about time that GM is finally starting to realize what non-fan boys have been complaining about most US car makers for quite a long time.

Bill Hageman

June 11, 2005 3:35 PM

As a very senior citizen who only wants to buy American, I offer my thoughts. My past two autos have been GM. My current a Pontiac G6. Unfortunately there were problems with both. 92 Bonneville got fixed,before the ext warranty expired. There were two problems that I learned to live with for ten years.The last car a 02 Saturn L300 after 2 1/2 years had more than its share of major problems so, the G6. GM needs to look at outdated styles, Vastly improved reliability and making cars that the average consumer really wants. They buy Toyotas because they are so much more reliable and have the right accessories, and the right price. I could give a lot of other reasons, like why has GM given all the styling emphasis to Cadilac and Chevy?

toddy

July 6, 2005 10:21 AM

GM is determined to ignore the brand loyalty that has given in a unique spot in automotive history. Too bad. I'm a Buick diehard, but I finally gave in to the midlife crisis and bought a red GP. Love them both, but a Buick is not a Pontiac, and in my mind never will be. I like having the choice. Cloning a Pontiac and calling it a Buick won't work.

motheralj

July 23, 2005 11:22 PM

i started out buying American.....and for years...
say 1957-71 things went pretty well....but after
that aggravating things started happening....then
we bought a toyota and nohing happened ....the
darned thing ran and ran and ran.....so we bought
now five of them....and we just can't wear one
out......the last has been a Lexus....and that
is a super Toyota....and well ....its the best
yet....so....

if GM and Ford could just hire Japanese senior
officials...i suspect we would see some changes.

motheralj

Actual Owner

December 16, 2005 11:17 PM

First off I own a Pontiac G6 and wonder where people get thier ideas about this car! Professional reviewers have to ask if they are out of touch with reality... here's why: Vindications include: JD Powers AWARD for best midsize entry sedan for design layout and execution STRATEGIC VISION AWARD for best ownership experience Consumer Reports gave the G6 a very good for acceleration. The crash test ratings on the G6 are very good also. And surprise the G6 coupe got the best rollover rating from NTHSA of any car period! One plant rating service said the Orion, Michigan plant was rated the 4th best in north america. Don't put your stock in Japanese cars: Recalls recalls: Honda Civic 2006 for Gas Pedal, Toyota Prius for stalling while moving, Toyotas recalls are way up, Nissan Infiniti QX4 is amoung the 10 worst..and don't forget Mitsubishi which hid defects from consumers for 20 years. Suzuki and Isuzu are so bad they aren't growing anymore..poor quality ratings as well. So, that means the durable models Honda & Toyota make are why people believe so much in Japanese..well the repairs on Japanese models as they age are unbelievably expensive..

Perry Kravec

June 14, 2006 2:48 PM

Still amazes me how unfair trade is never brought up in these conversations... Japan can sell cars here at a tax advantage over our GM and Ford while GM and FORD are kept out of the Japnanese market. How well would GM and FORD be doing now if all Japanese.. German and Korean autos had additional costs(taxes tarriffs etc) of over $12,000 put on each car? Free trade is only good if it's fair trade.

Papa

June 13, 2007 1:35 PM

Let's not forget that GM is not really a so-called "American Car" anymore. Sure, they have thier corporate base in the US, but the majority of the parts are built in China, Taiwan, Mexico, Canada, and elsewhere. GM has abandoned being American built and American made, they get thier parts from who ever makes it fastest cheapest. GM has closed plant after plant in the USA, while Toyota, BMW, and others are BUILDING plants in the USA and creating jobs.

So to think that GM is American, think again.
They may have used to be, but those days are gone.

Perry Kravec

November 13, 2008 8:23 PM

Yes PaPa and they are building plants here (which GM and FORD are NOT allowed to do in their markets) and paying NO US TAXES... we have rigged the system against our own companies.
GM pay an average $2500 per car US taxes while we make "deals" with these foreign companies paying for infrastructure give them buildings and tax free income... that's just stupid.

While they Keep us out of their markets. Each plant they open sucks approx. approx. 400 million us dollars out of our economy and puts American companies out of business.

If it were a good thing that they build plants here .. believe me.. they would let GM and FORD build plants in JAPAN.

Also notice that Buick is rated no.1 nameplate for LONG TERM reliability (JD POWERS).

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News, opinions, inflammatory meanderings and occasional ravings about the world of advertising, marketing and media. By marketing editor Burt Helm, Innovation Editor Helen Walters, and senior correspondent Michael Arndt.

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