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Mission Forgotten: Selling Quality Cars and Trucks

By Warren Brown
Washington Post Staff Writer
Sunday, March 20, 2005; Page G02

Car companies sell cars and trucks. At least, that is what they are supposed to do.

Whenever the managers and employees of car companies forget that primary mission, they get into trouble. Consider General Motors Corp.

Since General Motors has many more showrooms than its competitors, dealers have to work harder to sell these Chevrolet and GMC trucks. (Noah Berger -- Bloomberg News)

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Many of GM's current problems -- falling sales and market share, reduced first-quarter earnings and soaring costs -- were planted in the 1960s through the 1980s, when the company forgot that it was a car company.

In those days, GM believed its main mission was to manufacture money, which is understandable for a profit-oriented corporation. But it misses the point.

You don't have to be a car company to make money. You can be a Wal-Mart, a McDonald's, or Affiliated Computer Services Inc., the latter of which is a $4 billion global giant that makes money by designing and using computers, cameras and whatever else governments deem legal to monitor other people's business, including their driving habits.

Heck, you can be a health insurance company or even movie actor/director/producer Mel Gibson. But you don't have to be a car company to make a dime unless, indeed, you are a car company.

Then, you'd better make sure that everything you do is geared toward making darned good cars and trucks -- and that means "good" beyond the obvious requirements of product quality. Good automotive quality is a given nowadays. Korean automakers Hyundai Motor Co. and Kia Motors Corp. now have good quality.

"Good" here means products that are exciting, compelling, must-have cars and trucks -- like the Chrysler 300C sedan and Dodge Magnum wagon that have been driving the Chrysler Group of DaimlerChrysler Corp. to market acceptability and, as a result, to better sales and earnings.

"Good" also means products that are timely, such as attractive, fuel-efficient cars and trucks that are on sale when gas prices are rising -- as opposed to an over-abundance of fuel-consumptive pickup trucks and sport-utility vehicles, which happens to be the situation at GM in general and its GMC Truck Division in particular.

For nearly a generation, the 1960s through the 1980s, and then into the first half of the 1990s, GM's managers and employees forgot that GM was a car company. GM's leadership, controlled by financial people, was under the impression that it was running a bank. Products were secondary. Profits and dividends were primary. Almost anything that got in the way of profits and dividends, including spending on product innovation and improvement, was pushed aside.

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