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More from the GM losing a brand rumor mill.

Survivor: Buick vs. Pontiac
Comment from GM exec raises speculation that one -- or both -- of the venerable makes could go away.
March 29, 2005: 1:29 PM EST
By Chris Isidore, CNN/Money senior writer

NEW YORK (CNN/Money) - Pontiac and Buick could become the stars of their own reality show in the coming years: Survivor GM.

That's because the two mid-level brands of the nation's No. 1 automaker look like they're on the bubble. At an analysts' conference last week, GM Vice Chairman Bob Lutz said both lines are "damaged" and that dropping one of the venerable names -- both date back more than a century -- was possible unless there's a turnaround.

Lutz said closing a brand, as it did with Oldsmobile after the 2003 model year, was something that GM hoped to avoid. But he said that, if the carmaker's brands don't hit sales targets, "then we would have to take a look at a phase-out. I hope we don't have to do that. What we've got to do is keep the brands we've got."

GM officials have tried to backtrack somewhat on Lutz's comment, saying there are no plans to drop a brand and that he was only answering a question about a hypothetical. They say they're confident the brands will get the investment needed to grow.

"There's no strength in dropping a brand," said GM spokesman Dee Allen. "Pontiac, Buick and (truck brand) GMC together are stronger than two would be. They represent different customer bases."

But auto experts look at GM's continued slide in market share along with the financial problems caused by its current cost structure, and say the possible end of another GM brand isn't as much a surprise as the fact that a top GM executive would raise the possibility.

"It's a signal to folks that it's going to happen," said Walter McManus, director of the Office for the Study of Automotive Transportation. "They're very careful not to speculate about things that aren't going to happen."
Buick lags Pontiac in sales

Buick had 1.8 percent of the U.S. market in 2004, just ahead of the 1.7 percent share that Oldsmobile had in 2000, when GM announced the end of that line. Pontiac had a 2.8 percent share.

Both brands have recently had trouble attracting customers to new models that GM was hoping would give them a lift -- the Pontiac G6 and the Buick LaCrosse. Next up for the brands are the Solstice roadster from Pontiac and the Lucerne sedan from Buick.

But even the brands' advocates admit that getting potential buyers to look at these cars is a challenge.

"The G6, when we get people to test drive it, they love it," said Conrad Darby, a Florida Buick and Pontiac dealer. "We're just not getting sufficient people in to test drive it. And I think the Lucerne is going to be a home run. It's a gorgeous automobile. It's the problem we have with the rest of them. It's a four-door sedan and there are a million four-door sedans out there."

Still the dealer groups are a powerful constituency within GM, and dropping either Buick or Pontiac -- which would take the livelihood away from some operators -- would be a bigger battle than dropping Oldsmobile, which was seeing much of its sales from GM employees and rental car companies by the time the plug was pulled.

"I don't think Buick will go away," said Frank Bellavia, a Long Island, N.Y., dealer and president of the Buick Dealer Council. "The dealers do well. What we need is just more product."

But many experts think it's a tough road ahead for both brands, and that the end of the line could be near for at least one.

In fact, McManus said there's arguments to be made for GM dropping both brands. However, other analysts said it's unlikely that GM would want to drop both and have no mid-level brands in the space between Chevrolet and Cadillac.

Right now, many see Buick as running somewhat behind, with a somewhat older customer base to go with its smaller share.

"If I had to bet the farm, I'd say Buick will be the one that goes," said Mike Chung, auto analyst with Edmunds.com.

Chung said the weakness both brands have attracting new buyers is balanced by the strength both brands have in customer loyalty. That will make it difficult for GM to drop either brand with the hopes they would be able to hang onto the Buick or Pontiac customers with their remaining lines.

"I wouldn't rush to get rid of either line because of the costs associated with the move," said Chung. "But if GM's share continues to drop and gets down near 21 percent, I see them taking steps to phase out Buick."

Other experts say the decision could be a few years away, and that could give either brand a chance to win the race with the other.

David Cole, chairman of the Center for Automotive Research, said that if either brand ends up with a hot vehicle while the other flounders, it could be a deciding factor in which one survives.
Link:
http://money.cnn.com/2005/03/29/Autos/buick_pontiac_future/
 

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Another interesting read. Its time for the two brands to duke it out. I am not sure it is so certain Buick would go first either, as some analysts think, because Buick sells a decent volumes of high profit trucks where as Pontiac is almost exclusively all low profit cars.

Either way, it still comes down to product. If GM doesn't get its product base in order, it won't matter if they have 2 brands or 200.
 

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If Pontiac got the axe, I wonder who the Solstice would get shuffled off to. I really don't think it's life would end with Pontiac.
 

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brentil said:
If Pontiac got the axe, I wonder who the Solstice would get shuffled off to. I really don't think it's life would end with Pontiac.
I don't think Pontiac would be completely phased out before the Solstice was at the end of its run in its current body style anyway. They dragged out the death of Oldsmobile for a number of years. If it takes them 2-3 years to decide to axe Pontiac, then 3-4 years to completely phase it out, the Solstice could potentially be 7 years old before the division is gone.

By that time, a new reskin could end up over at Chevy.
 

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Fformula88 said:
I don't think Pontiac would be completely phased out before the Solstice was at the end of its run in its current body style anyway. They dragged out the death of Oldsmobile for a number of years. If it takes them 2-3 years to decide to axe Pontiac, then 3-4 years to completely phase it out, the Solstice could potentially be 7 years old before the division is gone.

By that time, a new reskin could end up over at Chevy.
even if this happens, i dont see why chevy would object to having an "affordable vette"
 

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If they had to cut a division, I still think Saturn and Saab should go, but if it's between Buick and Pontiac, then Pontiac should get the axe. The reason being that which ever they choose, they are going to loose faithful buyers loyal to the brand. If a Buick buyer can't buy a Buick anymore, it seems unlikely that that buyer would step down to a Pontiac, or suddenly pony up the cash to go to Cadillac, so they would no doubt choose a non GM brand.

On the other hand, if a Pontiac loyalist can no longer get a Pontiac, many of them would stay with GM. I can see Pontiac fans going to Chevy, Buick and maybe even Saturn. So I believe that killing Pontiac would help retain loyal customers more so than killing Buick. Also since Chevy already has a performance image and products, Pontiac is more redundant in the GM family than Buick. However it is my opinion that killing either is a dumb move. Better product offerings in both divisions and more seperation from other divisions would save them, and GM.
 

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As a somewhat Pomtiac loyalist, I would need coaxing to jump to Chevy, although they do have some fast product. I have driven Saabs and you can have them. So it would be Buick of Caddy for me and at teh price it would be a used Caddy or a new Buick, but where is the performance panache at Buick? Not since the GS455 and Grand National "Bad to the Bone" days.
 

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AeroDave said:
On the other hand, if a Pontiac loyalist can no longer get a Pontiac, many of them would stay with GM. I can see Pontiac fans going to Chevy, Buick and maybe even Saturn.
I am probably not a representative sample of loyal Pontiac fans, but Pontiac is certainly my favorite division. I would sooner buy a Ford than a Chevrolet.

As I see it, Pontiac is positioned to have a younger, hipper image than Buick, and that is a huge plus. Both divisions have loyal buyers, so that may be a wash. However, I wouldn't discount the fact that Pontiac's loyal buyers have an average age of 45, and Buick's loyal buyers are 65. Those Buick buyers are not going to buy many more cars before they start pushing up daisies. So if I were to chose between which buyers to alienate, I'd chose the older ones that won't be getting behind the wheel of many new cars anyway.
 

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I've also seen 65 average age figure. I expect the U.S. Buick models to transition into one model, the Buick Ambulette. :lol:

Brand will stay alive in China, where it is one of top marques: http://forums.gminsidenews.com/archive/index.php?t-4928.html

GM needs Pontiac to return to its sporty roots. Heck, right now the number one sporty GM marque top-to-bottom is the Cadillac. Think about that one for a second. Caddy has done a great job on their make-over, but what are the other brands doing?
 

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mceb said:
More from the GM losing a brand.

The G6, when we get people to test drive it, they love it," said Conrad Darby, a Florida Buick and Pontiac dealer. "We're just not getting sufficient people in to test drive it.
Where is the "beat a dead horse" smilie. I keep emphasizing that GM MUST embrace fantastic styling, at least in their "must buy" cars. Ala Mustang and 300C, if GM had made the G6 a gorgeous car instead of a Honda Accord clone, there would be a stampede of folks at least wanting to test drive one. According to this article, that is all it takes to sell a reasonable number of G6 cars.

Come on, GM! Let's transmit that Solstice quality styling to the rest of the Pontiac line!
 

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jimbo said:
Where is the "beat a dead horse" smilie. I keep emphasizing that GM MUST embrace fantastic styling, at least in their "must buy" cars. Ala Mustang and 300C, if GM had made the G6 a gorgeous car instead of a Honda Accord clone, there would be a stampede of folks at least wanting to test drive one. According to this article, that is all it takes to sell a reasonable number of G6 cars.

Come on, GM! Let's transmit that Solstice quality styling to the rest of the Pontiac line!
Styling is certainly an issue, and more unique styling for the G6 would undoubtably help with showroom traffic.

However, I wonder what cars those drivers were coming out of too. Media reviews feel the G6 is ok, but dislike its numb steering, coarse engine sound, and mediocre at best power for this class. I bet most of those buyers were returning Grand Am owners, or other GM owners, and not people who were cross shoping Accords and Passats, the cars GM thinks the G6 can top.
 

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Fformula88 said:
Styling is certainly an issue, and more unique styling for the G6 would undoubtably help with showroom traffic.

However, I wonder what cars those drivers were coming out of too. Media reviews feel the G6 is ok, but dislike its numb steering, coarse engine sound, and mediocre at best power for this class. I bet most of those buyers were returning Grand Am owners, or other GM owners, and not people who were cross shoping Accords and Passats, the cars GM thinks the G6 can top.
But awsome looks goes along way toward forgiving defects. This is why I'm most likely to buy a Solstice, and not an MX-5. On paper, the MX-5 beats the Solstice by a decent margin, and even though no one has driven either car yet, I expect the MX-5 to win at the track too. However the Solstice looks so cool, I am willing to over look it's defects and quirks, just to get that look. Mustang drivers forgive the solid rear axle, 300 drivers live with less visability, and Solstice drivers will have to leave everything at home, but the cars get sold.

Simply, the G6 gives a potential buyer no reason to cross shop. It's not super cheap, it not impressive on paper and the magazines have already said it's not as good. Without an emotional response from the styling, why would anyone go to the Pontiac dealer?
 

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AeroDave said:
But awsome looks goes along way toward forgiving defects. This is why I'm most likely to buy a Solstice, and not an MX-5. On paper, the MX-5 beats the Solstice by a decent margin, and even though no one has driven either car yet, I expect the MX-5 to win at the track too. However the Solstice looks so cool, I am willing to over look it's defects and quirks, just to get that look. Mustang drivers forgive the solid rear axle, 300 drivers live with less visability, and Solstice drivers will have to leave everything at home, but the cars get sold.

Simply, the G6 gives a potential buyer no reason to cross shop. It's not super cheap, it not impressive on paper and the magazines have already said it's not as good. Without an emotional response from the styling, why would anyone go to the Pontiac dealer?
I agree with everything you are saying. However, one caveat may be the effect of styling on a typical family sedan vs a sports car/sporty car too. I think styling is far more important to buyers of sports car, such as the Solstice, and sporty cars, such as the Mustang.

The 300 is somewhat of an exception to the rule. However a big part of its success is also the Hemi engine, which accounts for over half of all 300's produced. Its more of a sporty large sedan.

The G6 on the other hand is more along the lines of an Accord, by GM's own admission. If they are truly after Accord buyers, then styling may not sway them over to Pontiac dealers. Honda does not sell 450,000 Accord's a year based on their styling.

Now, if the G6 was regarded as being just as competant of a car as the Accord, or extremely close, then styling could be a deciding factor. I bet you would find a decent number of Accord buyers who would buy another car if they felt it was as good as their Accord, but with a nicer appearance. However, I do not think they want to surrender their perceived reliability and quality advantage.

Just as some people will compromise on some things for styling, others will compromise on styling for better overall vehicles.

GM needs to decide which of these customers they really want. If they want people who emphasize styling, then do it. If they want people who emphasize top notch quality, then do that.
 

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Fformula88 said:
GM needs to decide which of these customers they really want. If they want people who emphasize styling, then do it. If they want people who emphasize top notch quality, then do that.
Yeah, that's the problem. They're not giving people any reason to buy the G6. I think styling is more important to regular sedan buyers than anyone knows. Sedans have been so universaly poor looking across all brands for so long, that people don't even consider it a factor. Maybe the 300 is an annomily, but we'll find out when the Charger hits the showrooms. Yeah, Billy Bob and Cheater, aren't going buy it because it doesn't look like the General Lee and has extra doors, but lots of people out there who never even heard the name Charger before, I think will be wowed.
 

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I really struggle with the thought of GM folding another division. I think Olds and Buick were stepping on each others toes in most peoples minds so they could probably get away with that without offending too many, but I can't imagine not being able to buy another Firebird somewhere down the line. Buick I couldn't care about as I've never desired one nor ever will, but properly positioned I think the need is there for the division.
 

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Speaking of Buick, what was the last car they had that could be considered a halo vehicle, one that created some passion and excitement in the marketplace? The early-mid 80's Grand National? The Reatta? (If anyone realized it was even offered, sales volumes were low, and it didn't last long). They have been making your typical famuily hauler Century's, Skylarks, and LeSabres for ever. But what have they really had in the last 20 years to make customers, other than loyalists, say "I gotta have that!."

It holds mostly true for Pontiac too, but at least they had the Firebird up until 2002, and now the Solstice (maybe the GTO too).
 

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Fformula88 you are on the mark on Buick has not been up to. Their "halo" in recent years has been limited to the S-10 blazer clone that Tiger Woods promoted. One reason Reatta didn't make it is because no one expected such a car from Buick, sure maybe Opel back in the day, but same thing with Cadillac Allante and dare I say Chrysler TC Maserati. Cars that are/were basically good and out of the box, but not what the buyers expected. If you expect a Buick to be a subdued family car then flash doesn't work. That's one reason the jury is still out on the high performance Cadillacs. If you pardon the reference to drivers much older than I, traditionally Caddy has been an old peoples car. Put an 80 year old Fleetwood owner in the new 5 second XLR-V and you better call 911.
 

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Fformula88 said:
Styling is certainly an issue, and more unique styling for the G6 would undoubtably help with showroom traffic.

However, I wonder what cars those drivers were coming out of too. Media reviews feel the G6 is ok, but dislike its numb steering, coarse engine sound, and mediocre at best power for this class. I bet most of those buyers were returning Grand Am owners, or other GM owners, and not people who were cross shoping Accords and Passats, the cars GM thinks the G6 can top.
To qoute the article once more, " 'The G6, when we get people to test drive it, they love it," said Conrad Darby, a Florida Buick and Pontiac dealer. "We're just not getting sufficient people in to test drive it.' "

They love it when they drive it. So how does Pontiac get them to drive it? They are racing to Ford to test drive a Mustang and they are racing to Chrysler to test drive a 300.

If the G6 looked like the Chevy Bel Air Concept, I guarantee to you people would be racing into Pontiac to test grive one. If the Pontiac GTO looked like a modern update of a 67 Cadillac Eldorado, I am betting people would be racing to Pontiac for a test drive. JMHO.

A "halo" car like the Solstice will get people into Pontiac showrooms, then leave. The make-or-break "first ever" G6 should have had make-or-break styling, not look like a Honda Accord clone. Then you would see people tripping over themselves to test one.
 

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Fformula88 said:
Speaking of Buick, what was the last car they had that could be considered a halo vehicle, one that created some passion and excitement in the marketplace?.
Ff88,

I think you give the concept of a Halo vehicle way too much credit for sales of the rest of a company's model lineup.

Before the Honda S2000, Honda never had a halo vehicle. And nobody I have ever known decided to buy a Civic or Accord because they went to buy a Prelude or S2000, and got the practical car instead. They buy Accords and Civics because those cars offer a great value and word-of-mouth reputations for impeccable reliability.

Toyota has had no halo vehicle since dropping the Supra yet they are poised to overtake GM in world sales volume.

Halo vehicles have minimal effect. GM and Ford are only not in worse shape due to the many consumers who refuse to buy a foreign nameplate. When GM and Ford build cars equal to Accords and Civics, they will reclaim some of their market share. I think that time is very close in coming, as they are building great cars these days.

But the idea that Buick or any other GM division needs halo vehicles to sell the LaCrosse is erroneous. They only need beautiful well-made Buicks.
 

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Darkhamr said:
Buick I couldn't care about as I've never desired one nor ever will, but properly positioned I think the need is there for the division.
The question is, if Buick suddenly offered a car say like the Lotus Elise or Lighting Kappa, would you care then? My point being that a brand can be changed with the introduction of a truly great product. I believe that people's attitudes towards a brand image can be changed fairly rapidly with the right products. You say you will never be interested in a Buick, but I suspect a sub- five second two seat roadster at less than 30k would peak your interest and maybe even make a Buick man out of you.

Granted, it's not likely that Buick will ever build such a car, but there is no law that says they can't. Again, my point being that almost any brand image can be changed very quickly with money and the right products. There is no reason I can see why they couldn't drop Pontiac and turn Buick into a competetive BMW type company. But then again, I can't see how GM got so lame to begin with. :rolleyes:
 
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