Tuesday, June 3, 2008

Behind the curve

In yet another example of keen strategic thinking, G.M. finally reaches the shocking conclusion that gas prices affect sales and announces plans to close plants in Janesville, Wisc.; Moraine, Ohio; Oshawa, Ontario; and Toluca, Mexico by or before 2010. I guess it's hard to remember all the way back to what happened in the seventies. The New York Times reports:

Responding to a consumer shift to more fuel-efficient vehicles, General Motors said Tuesday that it would stop making pickup trucks and big S.U.V.s at four North American assembly plants and would consider selling its Hummer brand.

The moves, announced Tuesday by the company chairman G. Richard Wagoner Jr., will slash 500,000 units from the automaker’s overall production, and pave the way for increased investment in smaller cars and passenger vehicles.

Mr. Wagoner said that rising gasoline prices had forced a “structural shift” by American consumers away from truck-based vehicles built by G.M.

“These prices are changing consumer behavior and changing it rapidly,” Mr. Wagoner said at a briefing before G.M.’s annual meeting in Wilmington, Del. “We don’t believe it’s a spike or a temporary shift. We believe it is, by and large, permanent.”



1 comment:

  1. I had to laugh out loud when I heard on NPR that "GM is betting that the time has come for fuel efficient cars". Is their Magic 8 Ball finally being straight with them? Honestly, they don't even need to go back to the 70s. If they had started looking at this two years ago, maybe they wouldn't have had a 27% drop in sales between Mar 07 and Mar 08, but likely would have had that much increase.

    And I have to say, I don't think that compact car plan is the way to go either (isn't that what lead to the Chevy Citation?) People want the big cars they have, but they don't want them to use as much gas. Please, please Big 3, invest in fuel efficiency and alternative fuels before it is too late.

    I feel bad for Flint, but not GM. They have stuck their heads in the sand too long.

    Kathy W.

    Am I preaching to the choir here?

    ReplyDelete

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