Pontiac Launching “Aveo-Fighter” G3 In US
This Badge-Engineered Hatchback Unwittingly Showcases the Problems of GM’s Divisional Structure
By Kevin Miller
A press release today claimed “Pontiac Announces New Small Car for U.S. Market.” The release went on to describe the “sporty, five-door hatchback G3”. The thing is, the G3 is not new to the US market. It is already sold at Chevrolet stores as the Aveo5, and is also sold in Mexican and Canadian markets.
“The small car segment has literally exploded in recent months, with sales up nearly 33 percent in the first six months of 2008 alone,” said Susan Docherty, vice president of Buick-Pontiac-GMC. “The Vibe, G3, G5, and G6 prove that you don’t have to sacrifice sporty design and responsive driving to achieve impressive fuel economy.” I would say that the G3 subtracts credibility from Pontiac as GM’s “performance” division. And as for fuel economy, goes, the G3 isn’t really that impressive.
The G3, which will be available in spring of 2009, has EPA ratings of 27/34 MPG. It joins the all-new 2009 Vibe, and enhanced versions of the G6 sedan and G5 coupe in Pontiac’s over-30 MPG club. The Vibe is rated 32 MPG highway, the G6 gets 33 MPG, and the G5 gets 37 MPG. Yes, you read that right- the 155 HP G5 (itself a rebadged Chevrolet Cobalt) gets better fuel economy from its 2.2 liter four than the 107 HP G3/Aveo5 gets from its 1.6 liter mill. So the G3 isn’t exactly cutting-edge, then.
This press release, and the launch of the G3, is a clear demonstration that the divisional, badge-engineered GM of the last half-century is still alive and kicking. As GM celebrated its centennial earlier this week and looks toward the future, focus needs to be put on making great products and marketing them well. With products like the Cadillac CTS and the Chevrolet Malibu, GM has demonstrated they can make great vehicles. The G3/Aveo5 is not a great vehicle, but it’s an OK vehicle.
By launching the G3, GM now will need to market the same car twice- Chevrolet will advertise the Aveo5, and Pontiac will advertise the G3. Assuming that GM has a single marketing budget, the Aveo5 will get a percentage, and the G3 will get a percentage. The G3’s percentage is likely taken away from other Pontiac models. By splitting the marketing this way, the message of GM’s smallest-in-the-US car is diluted, as is the message about the rest of Pontiac’s lineup.
The divisional structure of GM creates these inefficiencies and promotes the dilution of GM’s message, which should be telling consumers about the great vehicles GM is manufacturing. Instead of engineering and marketing two or three (or four) versions of the same vehicle, GM needs to condense their offerings to the best products in each segment. Consolidate their volume brands (Chevrolet, Pontiac, Buick, GMC, and Saturn) into a single GM store. That store could sell a full line of cars, the class-leading vehicles in each segment: The Chevrolet Aveo (but no Pontiac G3). A Saturn Astra. A Pontiac Vibe. A Chevrolet Cobalt (but no Pontiac G5). A Chevrolet Malibu (but no Saturn Aura). A Saturn Vue. A Buick Lucerne. A Buick Enclave (but no Saturn Outlook or GMC Acadia). A Pontiac Solstice (but no Saturn Sky). A Pontiac G8 and G8 ST. A Chevrolet Corvette. A Chevrolet Silverado, Tahoe, and Suburban (or their GMC siblings, but not both). Doing this would make GM a full-line automaker, rather than an automaker attempting to support five full-line brands. Each vehicle would then be GM’s sole offering in that class in the marketplace, and could be supported by a greater percentage of engineering and marketing budgets. GM vehicles wouldn’t be competing with their badge-engineered cousins for GM’s resources or for buyers.
As it stands, the “new” G3’s biggest competitor will surely be the Chevrolet Aveo5. Neither Pontiac nor Chevrolet wins. And at the end of the day, neither does GM.
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