General Motors

So far all I have seen and heard of General Motors management initial response to its need to restructure is marketing changes. They're now offering a payment protection plan that's better than Hyundai's. They're emphasizing On-Star as a singular feature of GM cars. Payment protection isn't going to sell more cars. If your job is shaky, the last thing you'll do is add to your debt load. On-Star sounds great, but it's free only for the first year. When it comes time to start paying for On-Star "security", a car owner with a cell phone will think twice before paying a second cell phone (On-Star) bill.

Yet, GM still has a marketing problem. They are pushing the wrong products. The Cadillic Escalade SUV, that turns you on when you turn it on, may be the ticket for over-sexed drivers, but unfortunately they're a small segment of the market. And by the way, so are Hummer owners. The only way these models can justify their marketing expense is the sizable profit per unit from their sale. A comparatively fat profit on a small segment of the market doesn't come close to a comparatively slim profit on a large segment of the market.

GM's real problem is the attractiveness of their products. GM needs to lower prices and improve profitability of manufacturing its various models, while improving fuel economy for all models. GM needs to improve its hybrid car offerings. One of the dumbest things GM did was to spin off Delphi with all its technical expertise in batteries and electric motors just before hybrids were going to get popular. GM should buy Delphi back and dump all of its marginal model lines and convert their assembly lines into producing hybrid cars, pickups and local delivery trucks.

Running a tighter ship with a leaner crew will do more to improve GM's bottom line than all the hype. It's going to be a hard sell to all levels of GM's work force who act like they have a sinecure instead of a job.