Other Than That, How Did You Like The Play, Mrs. Lincoln?

GM North America's VP of Vehicle Sales Service and Marketing, Mark LaNeve, puts in a guest appearance on the GM Fastlane Blog this afternoon.  In his post he presents a case for things not being as bleak as everyone's saying.  The logic is  sound, if somewhat arcane and convoluted: 5 GM vehicles were included in a pool of 10 that JD Powers says are showing improved performance on a number of indicators of health. The indicators include, "reduction in the use and amount of customer rebates, an increase in actual retail transaction prices and a decline in the number of days it takes for a dealer to sell the vehicle."

OK. Doesn't sound bad. On any other news day, that might have passed blog muster.  Not today.

Yesterday, Kirk Kerkorian decided to up his ownership stake in GM, clearly not out of confidence in the company's recovery prospects.  More likely the renowed raider is looking for a way to get his hands on some of the more than $30 billion in cash GM's sitting on by forcing the company to sell off businesses or other assets.  Fire sale time, in Kirk's opinion.

Then today, Standard & Poor's lowered the rating on GM's (and Ford's) debt to junk status.  The move wasn't unexpected, but it certainly stings.  It increases the cost of borrowing for GM and reinforces mounting negative sentiment.

In the face of this one-two punch, Mark's optimistic report, while perhaps warranted, elicits a touch of pathos.  In the face of events like those that have taken place in the last two days, we'll have to have a lot better news than this if GM's to convince us that this massive turnaround is really going to happen.

Comments

[Jon Husband]

I think GM is in very huge trouble ... and sinking like a stone .. massive l-t debt, high overhead (health care costs), lost any pizazz they may have had, no hybrids that I'm aware of in the pipeline ... how much longer before we'll start hearing about government bailouts ?

[stephen clifford]

General Motors and Ford's automotive operations are becoming just like the older airlines saddled with legacy costs and managements too shell-shocked or hamstrung to take bold steps that have a chance of competing effectively with younger, more effective competitors.

[kurt]

GM has improved its cars a lot, but suffers a tired, stale approach in that it desperately shoves new (often unfinished) new product at us, rather than supporting what GM products we already own.

IMHO they could do better by cultivating a more pleasant, professional dealer athmosphere, and by properly equipping their service departments with TSB and part ordering information.

Also, why not involve customers in long term evaluation feedback? Some of us will be happy to take the time to talk to the engineers/techs and offer feedback. Also consider annual clinics where interested, literate people can can bring their cars in for review (by (I say "literate" because GM has to understand what is going on with the vehicle - yelling "my car sucks" is of little use to an engineer!)

Finally (gasp) GM might actually make some more money by offering reasonable product upgrades for cars people already own (engine enhancements, lighter/stronger wheels, bling-bling interior kits, etc.