GM Sales Surge
GM’s Electric Avenue
A Last Look at Hummer
General Motors, just months after its historic bankruptcy, has posted double-digit sales gains and shaken up its sales executives as CEO Ed Whitacre drives the auto giant toward his goal of profitability this year.
The automaker posted a February sales gain of 11.5 percent. For the four brands it’s keeping—Buick, Chevrolet, Cadillac, and GMC—sales were even better, rising 32.2 percent, the fifth consecutive month of gains for GM’s core brands.
Fleet sales led the way for the biggest U.S. automaker, which is majority owned by the U.S. government following its bankruptcy this summer. Such sales rose 115 percent.
For core retailers, sales rose 7 percent compared to last year, one of the worst in auto-industry history.
During the bankruptcy and since, GM has shed brands such as Saturn, Hummer, and Pontiac, and it has cut dealers as well. One of those dealers was to be Don Drennen Buick, which had been selling Buicks in Birmingham, Alabama, since 1908. But the dealership was later reprieved and has been at least beginning to get rolling since.
“We went through a unique situation: W e got fired in June and hired in November,” Ward Drennen of the dealership said. “So, we went most of the year without inventory, but now sales have been strong and the product is being well received by the public.”
Drennen credits the company’s willingness to reevaluate their products for the boost in sales.
“There’s been a cultural shift at GM, and they have gotten back to their core tactics that made them strong in the past, and that is well-built, nice-looking cars and trucks,” Drennen said.
The new lineup has boosted interests in the company products, he said.
“We are not only attracting the traditional buyer, but the people who may not have considered GM in the past,” Drennen said. “They’re coming in not looking at a Buick, but when they see one, they think Wow, I didn’t know GM was building stuff like that again.”
The company also seems determined to regain its engineering mojo with the introduction this year of the Chevrolet Volt.
The Chevrolet Volt is a first-of-its-kind car, with a battery and electric motor that will carry it 40 miles on an electric charge alone, and a small gasoline-powered engine that recharges the battery when it gets low. GM has bragged that the Volt will be able to drive 300 miles on a gallon of gas.
In essence, the Volt is new technology for the automobile market, and GM is treating its marketing efforts for the car that way—aiming it squarely at those who rush to buy the first high-tech products in markets like California when it rolls out later this year.
The Volt, though, is so far more an example of changes at GM than the real thing. The real thing may be the culture shift at an organization described charitably as sclerotic for years before it finally collapsed.
And the cultural shift of which Drennen spoke continues as word has emerged that the company is reorganizing its top sales team.
A source tells the Wall Street Journal that Mark Reuss, named North American president of GM, will take direct responsibility for sales in the region. Susan Docherty, who had headed sales and marketing, will give up the sales role and continue as head of marketing.
As the Journal points out, the changes reflect the impatience of Whitacre, who wants GM in the black by the end of the year and is focused on growing its North American market share.
Other car companies also reported big improvements in their February numbers. Ford sales rose 43 percent. Honda sales rose 13 percent.
And not all the news for GM was good this morning. The automaker also announced a voluntary safety recall of 1.3 million compact cars to replace a motor in the power-steering system.
Vehicles affected are the 2005 through 2010 Chevrolet Cobalt and 2007 through 2010 Pontiac G5, both sold in the United States; 2005 and 2006 Pontiac Pursuit sold in Canada; and the 2005 and 2006 Pontiac G4 sold in Mexico. The recall comes after an investigation by the National Highway Traffic Safety Administration that began in 2009.
Kent Bernhard Jr. is News Editor of Portfolio.com Aneesa McMillan is research director at the Birmingham Business Journal
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