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November 21, 2005
Response on Red Tag
By Mark LaNeve
Vice President, GM North America
Vehicle Sales, Service and Marketing
OK, Fastlane bloggers, you’ve gotten my attention. I've seen your blog entries and wanted to respond. Some of you objected to including my Red Tag comments in this forum and urged me to stick to discussing only product. Others quarreled with the Red Tag program itself. Clearly, Fastlane is intended to focus on product. And for the most part, we do. Once in a while, however, I think it's important to give you some insight as to why we're doing a certain marketing program -- particularly when our competition is out there providing color commentary on our actions.
The reality of the business is that we want to move the metal at the end of the year. We know the Employee Discount for Everyone program brought in lots of customers who otherwise might have waited. But people haven’t stopped buying cars and trucks -- so we’ll do what it takes to bring new prospects our way, and our competitors will try to do the same. That doesn’t mean Total Value Promise is history -- far from it. Do I have to say “read my lips?” We're committed to this strategy because we're confident that over time it will bring new buyers into GM dealerships to experience first-hand our great cars and trucks -- particularly the new ones that are coming to market in the next few months. And after all, isn't that our goal? Red Tag is in synch with this strategy because it supports our efforts to close the gap between MSRPs and what you actually pay for a car or truck. Programs like this will always be part of our business. That's just the way it is. They make our business more exciting, and when we do them well they set GM apart from the competition.
When all is said and done, our latest promotion is about getting people in GM showrooms to see, touch and test drive really great products. With our 2005 and 2006 lineup, the hard work we’ve done in recent years to produce category-leading vehicles is really paying off. From Cobalt and HHR to the G6 sedan and coupe to LaCrosse and Lucerne – not to mention Solstice and the outstanding Cadillac lineup – it’s clear that GM is back in the car business, with products that really grab the market and hold on tight. Our all-new 2007 large SUVs take this segment to another level of excellence -- especially when it comes to interiors. Equinox and Torrent are big winners in the small SUV category, and HUMMER H3 is keeping that brand at the top for truck lovers. But there I go selling again.
Posted by Editor at 10:30 AM
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HHR: Fit To Be Tailored
Chevy HHR Open Air
By Bob Lutz
GM Vice Chairman
Back in August I challenged you to test-drive some of our newest products and see for yourselves if they deserve the lavish praise I’ve been giving them. I spoke specifically of the Chevy HHR and Impala, Pontiac Torrent, Hummer H3, Pontiac G6 Coupe and the Solstice.
It appears that at least some of you have taken me up on that, because those vehicles are getting attention in dealerships. The HHR in particular has been making a lot of headway in the marketplace.
Chevy dealers are telling us they can’t get enough of them; they are selling them at about three times the rate they’d ordered them. About half of those sales have been conquest sales – from customers who previously owned a non-GM product. All signs tell us the HHR is just getting started, so we are preparing for higher production than we set earlier in the year.
What I really like about HHR’s performance so far is that sales are hottest where GM has traditionally not done so well: on the west coast, for instance, and in warm-weather cities like Dallas and Houston.
Why has it gotten so popular? Let’s start with the fact that it looks pretty darn good. The HHR has character. People are drawn to its unique exterior, which is the result of crossing a 1949 Chevy Suburban – the original utility vehicle – with the much newer Chevy SSR. Yet, the HHR doesn’t take up much space; it’s only 176.2 inches long, so it’s easy to maneuver. It’s also very versatile. With the front passenger seat folded down, the HHR can carry an 8-foot ladder with the liftgate closed. Younger customers and those who like the latest gadgets appreciate the auxiliary input jack that allows an iPod to be played through the audio system. Our 1LT version of the HHR comes with a standard MP3 player.
People appreciate the HHR’s vehicle dynamics, thanks to the same compact-car architecture that has made Cobalt a hit. The price, starting at $15,990, seals the deal, reminding the customer that this car is nothing if not a great value.
And what’s more, it’s a lot of fun. I was unable to attend the recent SEMA show in Las Vegas, but from all accounts, HHR was a smash hit there. It had a huge presence, and was named the most accessory-friendly vehicle at the show.
Some HHRs were on display by GM, including four that made their customized debut on the Rides TV build-off, others were exhibited by aftermarket outfits as partner vehicles, and many others were purchased and tricked out simply because HHR lends itself so readily to such treatment.
There’s almost nothing you can’t do with it, and our people at the show returned with tales of nearly every variant imaginable. Surf mobiles, pro-street, urban, canyon runners, you name it. Whatever the taste, there was a flavor of HHR
for it. Color pallets ranged from the huge OE pallet to flat tones, two tones and every color the painters can mix. Some displayed new wheels and lowering kits, some were converted to panel rigs, and some were stuffed with audio equipment. It was all music to my ears.
Posted by Lutz at 3:13 PM
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Red Tag with a Twist
By Mark LaNeve
Vice President, GM North America
Vehicle Sales, Service and Marketing
Last year about this time, GM introduced the Red Tag Sale, a year-end marketing program that broke new ground for us and was a huge success. This week we’ve brought it back for another run – from Nov. 13 to January 3, 2006 – but it’s a new and improved version.
This time we’ve combined the best features of this past summer’s “GM Employee Discount for Everyone” campaign and last December’s Red Tag Sale. Once again, there will be a red tag to look for on most 2005 and 2006 model year Buick, Chevrolet, GMC and Pontiac models. But the listed price will be low, surprisingly low; and the price on comparably equipped models will be the same nationwide. This simple, consistent offer, along with the “what you see is what you pay” concept is the kind of straight-forward approach to pricing that people really appreciated about our earlier programs.
There are a couple of reasons why I like the Red Tag Event. First of all, it builds on the growing consumer awareness that GM stands for tremendous value. We are determined to provide customers cars and trucks that look great, perform flawlessly and come in at a lower-than-expected price. Just as importantly, Red Tag again gives us a leg up on the competition. With our program, consumers won’t be at all confused about what they are going to pay for a a Chevy, Buick, Pontiac or GMC vehicle. After all, it’s right there on the sticker. None of our competitors can make that claim.
Our other divisions -- Cadillac, Saturn, Saab and HUMMER – also are getting in on the action, with their own year-end special offers.
Sure, one of our goals here is moving product at the end of the year – a time-honored tradition in the automotive business -- and all manufacturers are in the game. But the simplicity of the offer, along with the transparent pricing, is what sets our program apart from the pack, and the focus on exceptional value represented by our vehicles strengthens the GM brand. That is critical to our success in 2006 and beyond.
Posted by Editor at 2:01 PM
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Podcast: Escalade Preview
2007 Cadillac Escalade
A crowd of celebrities saw the 2007 Cadillac Escalade for the first time yesterday, at a Rodeo Drive party in Beverly Hills, California. In this podcast, Cadillac General Manager Jim Taylor talks about the more powerful but more fuel-efficient Escalade, its new interior features and sound system, and the party. The Escalade will also be shown at the Miami Auto Show today.
Posted by Editor at 1:55 PM
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An Eye Toward the Future
Elizabeth Lowery
By Elizabeth A. Lowery
GM Vice President, Environment and Energy
This week I spoke at the Environmentally Friendly Vehicles Conference in the United Kingdom about GM’s advanced technology strategy, and would like to share some of the details I covered with you here, specifically our plans for bioethanol-based fuel systems and hybrids.
Those are only part of our solution, of course — GM has an advanced propulsion strategy to increase vehicle fuel economy and reduce emissions by executing a comprehensive technology plan that includes advanced internal combustion engines, new transmissions and hybrids in the near term, and hydrogen fuel cells in the long-term.
Beginning with the near-term strategy, our advancements in internal combustion engines have been well documented. These include improved variable valve timing systems, six-speed automatic transmissions, and advancements in diesel technology. We also offer vehicles that run on compressed natural gas, and liquid petroleum gas.
We’re also increasing the number of vehicles we have worldwide that run on bioethanol-based fuels. In North America we currently have 9 FlexFuel vehicles equipped to run on E85, which is 85 percent bioethanol and 15 percent gasoline. We have a million and a half such vehicles on the road right now, and current plans call for the addition of more than 2 million more through the 2010 model year.
E85 can cost less than gasoline; it’s clean-burning, reducing sulfur and aromatic hydrocarbons; and it’s domestically sourced and renewable, since it’s typically corn and sugar cane-based. If you compare a vehicle using E85 to a typical hybrid vehicle, the hybrid may get better gas mileage but the E85-powered vehicle saves hundreds more gallons of petroleum per vehicle per year, because only 15 percent of what you put in the tank is petroleum-based, compared with 100 percent in the hybrid’s tank.
In addition to our vehicles on sale in North America, we also have a large fleet of vehicles that run on bioethanol in Brazil. In Europe, the Saab 9-5 2.0t Biopower is already available in Sweden, and is Sweden’s best-selling environmentally friendly vehicle. It will be offered throughout Europe in demonstrator fleets next year. Saab will also offer the vehicle in China and Brazil.
It can run, without adjustment from the driver, on bioethanol-based fuel or gasoline in any proportions. It makes 180 horsepower while running on E85, compared to 150 hp on gasoline.
In the big picture, E85 is just one of what we see as a number of solutions to the energy equation, and we’re planning for all of them, so that we will be ready when the market decides which way to go. We’re not putting all of our eggs into one fuel tank. No single technology will resolve the environmental challenges we face, and that’s why our strategy is multi-faceted.
Hybrids are an important part of that strategy. There is little question that hybrids will remain an important part of the automotive landscape. But let's keep in mind that we're talking about a very small and very young market that is just now developing into higher volumes, and there is much to be discovered as to how big this market will get and how far it will grow.
Given the high investment and high cost of components inherent in the technology, we've embarked on a strategy that taps innovative approaches to give us the best footing possible in this growing market. We've also targeted traditionally higher consuming vehicles to maximize the benefits for the environment and make the fuel savings equation more attractive to the consumer.
For instance, customers for the hybrid system in the Saturn VUE Green Line that will be introduced in North America next year can expect a real payback on their initial investment in three years.
In 2007 the new fullsize SUVs will be available with our patented next-generation two-mode hybrid system, increasing their fuel efficiency even more, about 25 percent, with very little loss in performance. The addition of a second hybrid mode to the drive system improves efficiency, and reduces the need for large electric motors found in typical single-mode systems.
As you may have read, to make the new two-mode system the best system it can possibly be, and to get it into the hands of as many customers as possible, we have entered into a collaboration with DaimlerChrysler and BMW to develop it and make it more widely available. The combined development and market power of this group of companies — each with its own significant and unique strengths — is moving the two-mode hybrid system into the technology-of-choice for the industry. And we may add some more companies to the partnership before all is said and done… stay tuned on that one.
As I said, those are just two elements of our strategy that I discussed in the U.K. In future posts, we’ll discuss the rest, including our long-term hydrogen fuel cell plans.
Posted by Editor at 12:01 PM
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Podcast: 2007 Cadillac Escalade
Jim Taylor
In this podcast, FastLane radio host Deb Ochs interviews Jim Taylor, Cadillac general manager, about the unveiling of the 2007 Cadillac Escalade, being revealed this week in Beverly Hills, Calif. Taylor hints about the new features and talks the vehicle's image, along with celebrity interest. A follow-up podcast will take place after the reveals.
Download the MP3 (7.51 MB)
Posted by Editor at 12:14 PM
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