Cadillac Shake Up Underscores GM Worries
Is the Cadillac Converj dead?
General Motors seems to be worried about how the automaker is recovering post-bankruptcy. And that may not be a bad thing especially since that also means GM is living in reality, not wishful thinking.
Under the old GM, losing hundreds of millions of dollars each week wasn’t taken as seriously as it should have been. That sort of disconnect hastened the company’s decline, eventually leading to bankruptcy and becoming a ward of the state. Rick Wagoner may have been a gifted speaker, but while he spoke GM burned through huge wads of cash.
Impatient GM
Today, there is a strong undercurrent of impatience running through GM world headquarters at RenCen and around the world. GM not only has to rebound but they have to do it quickly. Yes, US sales were up in February but they aren’t where they should be. Worse, the company hasn’t capitalized fully on Toyota’s misfortunes and they also ceded the top position to their arch-rival, Ford. That latter event was the most painful one to bear coming from the only one of the three domestic producers not to go bankrupt.
Which leads to what GM did earlier this week: reshuffle the deck. Again.
On Tuesday, GM announced that several people were having their responsibilities changed including Susan Docherty. The one-time head of the Buick brand has gone through several job changes over the past year, but at least she can say she still has a job unlike three Cadillac executives who were booted: Steve Shannon, John Howell and Jay Spenchian.
Why the shake up at Cadillac? Sales. Sales. Sales.
Sinking Sales
In 2009, Cadillac saw its sales fall by one-third, the steepest decline of any of the surviving four GM brands. Year to date Cadillac is up by 14 percent, but that pace is below expectations. Meanwhile, sales for rival Lincoln have been increasing and the entire luxury market seems to be rebounding.
With a new SRX crossover and expanded CTS line in play, Cadillac has the product to attract buyers. GM just isn’t confident that their tools (executives) are a good fit, thus the shake up. And with Ed Whitacre at the helm quicker results across the board are a must for GM.
Converj Collapse?
Not verified yet this morning but something of major interest are rumors circulating that the Cadillac Converj, an upscale version of the electrified Chevrolet Volt, is dead. I find that hard to believe but if it is true my thinking is that GM will introduce a Buick version of the Volt instead. Still, with the Lexus HS250h marketed as the upscale version of the Toyota Prius, what will Cadillac get? The XTS Platinum, perhaps.
The month of May cannot come soon enough for GM because that is when the first compact Chevrolet Cruze models roll off of a Lordstown, Ohio assembly line. Chevrolet is what is really holding up GM, delivering about 70 percent of all sales with the Cruze expected to help the brand gain traction in the ultra-competitive compact car market.
Time is of the essence for GM who must prove ASAP that they are a viable entity. Unless the automaker gets the upper hand soon, a rebounding Toyota and surging Ford may prove to be the least of their problems.
Photo Credit: GM Corp.
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July 26th, 2010 at 5:07 pm
Cadillac design changes have alienated more buyers than it has gained. Those who traditionally liked Cadillacs do not like their current products. Likewise those who like the new ones do not like the old ones but there are not enough of them to replace the old ones.