Friday, August 5, 2011
Making it at GM
A funny thing happens when you make products that people want. They're willing to pay for them.
As the New York Times noted, General Motors' earnings were up 89% in the second quarter largely because sticker prices are up about $500 per car and GM is spending $800 less per car in incentives.
Yes, the earthquake and tsunami helped by reducing the production capacity of Toyota and Honda, but in general buying a new car is not a "now" decision. If people really felt if it were worth waiting for their Camry or Accord they would. Apparently, it's not.
This is a far cry from the dark days of the late 1980s when all I had to promote were the Corsica, Baretta, Celebrity and Caprice. But 30 years later, they seem to have figured it out.
Things will get tougher for GM in the third and fourth quarters, but at least they're on the right track: listening to their potential customers, benchmarking their competitors like never before, and producing cars that are actually surprising and delighting both owners and critics.
And as long as they do that, they have a fighting chance.