Ditto for Ford: Product focus

Ford has similar problem as GM. A core brand, Mercury, seems unimportant. Mercury cars are just fancy Fords, sitting in the same dealerships next to Lincolns, which are truly distinct from their down-market cousins.

Are people stepping up from Ford to Mercury to Lincoln, like Toyota expects with Scion to Toyota to Lexus? Those brands make loads of sense because they are significantly different. Honda has Acura, and Nissan has Infinity. No confusion about what these brands mean.

Did I forget to mention that GM and Ford cars tend to NOT rank highest in auto-industry lists out there? The last I checked, neither had a single vehicle in the Consumer Reports list of most-reliable used cars.

Also, regarding operating efficiency and profits, neither GM nor Ford has the opportunity to gain scale across its value chain for design, production and marketing. I bet the incremental revenue is minimal for keeping their extra brands and models distinct, instead of rebadging some models into the core brands. Ford could just kill Mercury because each Mercury vehicle is a Ford with dressed-up interiors. GM could put rename some Pontiacs as Chevys, and maybe some Buicks as Caddys. Bye-bye, GMC.

With more focus at GM and Ford on how wide and deep to run their businesses, management could more effectively deploy resources against goals.


What GM should do: Product focus

Big problem at GM: Lack of product focus. They do too many things without doing very well at any or many. Americans don’t need all those mediocre midsize sedans, for example. Honda and Toyota each has one midsize sedan that significantly outsells any GM competitor.

Do we need any Pontiac-Buick-GMC or Saturn dealers? GM should focus on the 2 American brands that are truly distinct from one another: Chevy and Caddy. Differences between/among brands should be significant. How different are Buick and Caddy? Chevy, Pontiac and Saturn?

First, rebadge any worthy vehicles.

Second, kill Pontiac, Buick, GMC and Saturn. Sell Hummer to Chrysler, where the trucks become part of Jeep.

Third, convert any willing dealerships into facilities that (1) service all GM brands and/or (2) sell certified, preowned GM vehicles. I’ve heard that dealers make a lot more of their profits from used cars and service, so the Pontiac-Buick-GMC dealers might welcome the opportunity to give up on new cars. Let the gov’t and GM engineer soft landings, but kill the brands as fast as possible.