Governmentalized GM
What’s the first thing that happens after a bad relationship ends?
A new relationship begins.
Sometimes, not quite before the old/bad one has entirely ended.
Often, without much though about the consequences of decisions made in the heat of the moment.
It’s interesting to think about all that as word arrives about GM’s apparent decision to dump its European Opel subsidiary (which appears to be having a down-low affair with Peugeot) in order to refocus its declining vigor on the U.S. market, where it continues to bleed market share like an old tire with a slow leak.
Current Prices on popular forms of Gold Bullion
GM CEO Marry Barra talks about the need for GM to “disrupt ourselves,” which is her way of saying – crap, we are in trouble!
Right now, GM’s combined market share in the United States is less than what Chevrolet’s market share was in 1970. Things have not been good for years, especially the years after the bankruptcy in ’09 and the cashiering of Pontiac, Oldsmobile, Saturn and Hummer.
Consolidation into just Chevy, GMC, Buick and Cadillac hasn’t helped.
That’s still four full-line divisions vying for a slice of the pie that Chevy alone once had all to itself.
GM’s U.S. market share is still in the low 20s and stock prices (despite a recent uptick) hover in the low $40s – about the same as when the much-touted First Woman CEO took over the helm of the world’s once-upon-a-time Number One in the world automaker.
She has made “ROI” – return on investment” – the new GM mantra. It is why the company is shifting to a rent-by-the-hour business model (more here) and it may explain the odd decision to headquarter GM’s Cadillac and Chevrolet media/press relations offices in Noo York City – a place unfriendly to real journalists who actually drive cars but very friendly to the metrosexual hipster types GM is courting.
Anyhow.
The divorce from Opel (after committing more than $1 billion toward “marriage therapy”/restructuring efforts since 2012 alone) would allow GM to refocus on things other than being the world’s Number One automaker.
Like being Number One . . . in America.
Maybe by getting under the sheets with FiatChrysler?
Fiat – which is yuge in Europe – hasn’t been able to make much headway in America. The Italian combine bought the clapped-out wreck that was Chrysler and became FiatChrysler, or FCA – with the idea that Fiat could use Chrysler’s established dealer network to gain instant access to American car buyers for its cars, while also making use of whatever remaining parts of the Chrysler product portfolio still had a pulse (like Jeep, for one).
But the marriage of convenience hasn’t turned out well.
The Chrysler side of things is becoming noticeably peri-menopausal and crow-footed. Aging models like the 300 – and the Dodges that are kin to it, the Charger and Challenger – have clearly been abandoned.
There is nothing new on deck, car-wise.
A clear sign that Fiat wants out.
Does GM want in?
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