"The new Chevrolet Malibu has topped General Motors Corp's sales expectations in its debut month on the market by a wide margin, a senior GM executive told Reuters." Ironically enough given his moniker, this piece of good news arrived courtesy Maximum Bob Lutz. GM's Car Czar revealed that the artist formerly known as the world's largest automaker blew-out its 500-car sales target for the new 'Bu by 2500 units. While the numbers call into question (again) the wisdom of launching a $150m ad campaign for a new car without any "boots on the ground," why that's 300 percent better than [GM's] expectations! Bob reckons this is good news because "most Chevrolet dealers do not have a car because they're selling as fast as they get them." Or, alternatively, GM didn't make enough. And speaking of bad planning… "Lutz said GM had misjudged the relative demand for two new crossover utility vehicles built on the same platform: the Buick Enclave and the Saturn Outlook. 'It just shows you how the best laid plans go awry,' Lutz said. More specifically, "The Saturn Outlook has been a little slower than we expected. I think that's partly because there aren't enough Saturn dealers, and secondly, there isn't the brand awareness for Saturn." Not enough Saturn dealers? Wow.
Find Reviews by Make:
Read all comments
“They’re selling as fast as they get them”
Just like the Solstice.
Don’t like the sound of that at all.
Here goes fit & finish down the tubes.
Phil sales are up and fit and finish goes down?
I fail to see the conection.
If a Japanses or European manufacturer would have a car flying off the shelves with no inventory it would be considered a “success”.
If GM has a car that is flying off the shelves, there must be something wrong, and at some point since we all know that the novelty wears out very quickly. Some pundit will say “told you so”.
AGR: If GM has a car that is flying off the shelves, there must be something wrong, and at some point since we all know that the novelty wears out very quickly. Some pundit will say “told you so”. You're misrepresenting the situation. The new Malibu is not "flying off the shelves" because there aren't any on the shelves. On the face of it, demand outstripping supply is a good thing. But GM is volume car builder. The new Malibu is [supposed to be] a volume seller, not a Ferrari. If The General was selling 50k Malibus a month and still not being able to make 'em fast enough, THEN you could celebrate their success. At the moment, we're talking 3k cars in the middle of a $150m launch campaign. I make that $50k per car sold.
I see what you saying R.F.The numbers are small.
G.M would love to turn up the speed.But not at the expense of percieved quality.Thats how we got in all this excretement.
mikey:
G.M would love to turn up the speed.But not at the expense of perceived quality.
Perceived quality? And are we saying that quality control mandates a first month’s Malibu run of just 3000 cars?
If so, what does THAT tell you about their production efficiency?
RF,
There is a fine line somewhere, I agree with you that right now there are probably not enough cars since it is a volume car. At the same time not having enough might hopefully create “demand” and a “pull” situation, instead of the usual “push”.
If this car is as good as everyone says it is in its segment and price, it has to earn its “lunch” in the market, it has to recapture consumer confidence, it has to win hearts and minds.
It is or it should be a volume car, but its got to earn its “lunch” will a consumer react more favorably by seeing a line of 50 Malibus on a dealer’s lot?
Has anyone ascertained why there are so few Malibus on the market? Is it because GM really are trying to make each one with quality and reliability in mind or is because the fewer Bu’s on the market, in conjunction with the hype it’s been getting, will drive people to pay RRP and keep their value on the used car market?
Or is because no-one knows?!
Katie:
Good question. We’re looking into it.
As far as we can tell, the tight supply is the result of a bureaucratic snafu. GM just couldn’t get the job of building new ‘Bu’s in time, and the marketing department couldn’t wait (all the ad time’s booked months if not a year in advance).
What kind of Bizarro world are they livin’ in at the “the Tubes” anyway?
They figure a gas-guzzlin’ $40K(CDN) Saturn SUV is gonna sell like hotcakes, while a $20K bread-and-butter sedan is only going to sell about 500 a month?
Stupid.
Can you imagine the pressure on UAW members right now to get Malibus off the end of the assembly line?
Can the UAW in its’ present mood be trusted to not adopt an attitude of “That’s good enough”?
As I understand it, Saturn has lost money for 17 straight years. And as I understand it, Saturn has pretty much the same number of dealers now as when the the Outlook was launched and the dealer count for Buick/GMC were pretty much where they are. And the GM execs are surprised? The sad thing is that I believe they really are surprised. Imagine how it must feel to be a PBG dealer trying to survive in spite of the continually surprised state of the 'leaders' of your only supplier. Who, incidently, are being paid millions in various forms to do what they continue to be (over) paid to do in spite of the NOT surprising results. And, speaking of surprises, we read a few days ago that Fritz Henderson was surprised that GMAC took a hit since the housing crash was, er, surprising. He said they didn't see it coming at the start of 2007. He might want to try reading some financial news for a change since just about everyone else DID see it coming at some point. Surprising as it apparently is to some highly-paid CFOs, bubbles do burst, and when housing prices increase at a rate substantially faster than other prices AND income for several years running, that spells bubble. POP. The engineers have designed good products, the assemblers have done a big give-back, but the screw-ups continue.
Not enough Saturn dealers? Hardly. But they *are* in the wrong places. Closest Saturn dealer to most of LA is up in the San Fernando valley – that’s 10-25 miles away from most LA locations, and a healthy drive in bad traffic.
500 crazy Americans buying a 1st year, 1st month production car, a GM none less.
These folks should get a medal.
Or a free consultation with a psychiatrist.
As the Germans say…Die Dummen werden nicht alle.
I think that’s partly because there aren’t enough Saturn dealers
Keep the comedy coming Lutz. I couldn’t make this stuff up even if I tried! Lutz says this without knowing the fact that in the 1990’s during Saturn’s sales peak there were the *same* number of dealers as there are now, and that back then apparently Saturn dealers had no trouble moving huge volumes.
AGR:
will a consumer react more favorably by seeing a line of 50 Malibus on a dealer’s lot?
Compared to seeing NO Malibus on the lot? The answer is yes, yes they will. GM is already celebrating with champagne bottles even though this is only the FIRST month of the new Malibu on sale and even though many dealers don’t have ANY Malibus at all, not even demo cars available for a test drive.
How do you think a consumer will react when they see Malibu advertising, become interested in the car and head down to the dealer only to find out that not only are there no cars on the lot, but that there are no cars to test drive. Then the dealer will tell the consumer that they will only be getting a handful of new Malibus over the next 2 months. The consumer will most definitely be frustrated and will go buy a car from a competitor instead.
Consumer confidence in the Big 2.8 is already very shaky and this whole situation with the Malibu won’t help.
Consumers in the midsize sedan class want choice. You can go to just about any Toyota dealer and you’ll see plenty of Camrys on the lots. That does not mean sales are slow; it simply means each dealer has variety of Camry models on the lots to offer a choice to the consumer. This makes sense consider there are 5 different model trims of the Camry. You can also go to most Honda dealers and see plenty 2008 Accords on the lot too.
Seeing vehicles on the dealer lot does not indicate slow sales. You need to know *how long* those vehicles have been sitting on the lot to know if sales are slow. In the industry, Toyota has a very fast inventory turnover rate. Same thing with Honda. So although you may see lots of Accords or Camrys on the lot, they don’t sit there for long. They quickly are bought up by consumers and then are swiftly replaced by more Camrys and Accords and the process repeats itself.
“If a Japanses or European manufacturer would have a car flying off the shelves with no inventory it would be considered a “success”.”
Selling 3,000 units of your new bread and butter mid-sized sedan in a month is just silly. This is a segment where US annual sales are in excess of 1 million units per year.
One way to exceed expectations is to set those expectations absurdly low.
And what about the $150M marketing campaign? Why was it launched at a time when GM didn’t expect to have more than a handful of cars to sell? If GM’s plan was to build 500 cars that isn’t even enough to stock each dealership with ONE!
“The Saturn Outlook has been a little slower than we expected. I think that’s partly because there aren’t enough Saturn dealers, and secondly, there isn’t the brand awareness for Saturn.”
Actually Bob, the problem is that their shouldn’t be three versions of the new GM CUV.
Either make Chevrolet your volume passenger car brand or do it with Saturn. There is no good reason to have ’em both. Saturn never should have been started, GM should have put the energy into fixing what it already had. Why continue to throw more money on a bad idea? It’s not like you are a government agency!
R.F Yes it worth it to build 3000 a month,if thats what it takes to build it right!Production efficiency will come.
As we all know there is folks out there ready to jump on the slightest flaw.
G.M is looking right at Accord sales.They cannot
compromise quality at any cost.
Phil Bailey :The U.A.W. does not or have they ever set quality standards.Lets clear up a little myth here.The rank and file of the U.A.W./C.A.W is not made up of radical,crazy,disgruntled,drunks
In the modern plant you have an assignment to do.If you don,t complete your asssignment you better have a good reason.Its called progresive discipline.You can and wiil be fired and the union can,t get you back in.
In a word, people in the plant are shit scared of thier jobs.Why do think they voted yes for concessions.
Believe me Phil if someone performs shoddy work they will be tuned up by thier peer group.And if I might add not nearly as pleasantly.
As someone who has spent 35 years in all areas of auto build .I think I know what I,m talking about.
Maybe it’s just me, but my calender STILL says that it’s November. In fact, it looks like there are still 9 days left until December 2nd.
Didn’t the new Malibu go on sale November 2nd? I was unaware that a full “month” was 21 days later. Is November the new February?
Maybe they shipped all 3000 produced in November to dealers. The ones that are built next week probably wouldn’t make it out til December. Or something.
Just saw my first 08 Malibu, on the lot today. It was a white LTZ. Not a bad looking car! Sunday – so unable to get into the car. If the quality of the materials inside, and the workmanship throughout is – as has been advertised by GM – I’ll probably buy one within a few months. So much better looking than the Cad CTS they recently came out with. With the looks -I’m impressed.
For a European who likes the US, how unexpected is this negative reaction to the launch of an apparently quite lovely US-made car, the new Malibu. The design looks great and if it drives as well as the G6, it drives really very well. I have been watching GM with growing admiration as it fights its way back into success, both in the US, but also in China – where I am frequently – and in Europe, where I live. Negative opinion about US car makers may have been right in the past, but is bashing GM not somewhat behind present perceived reality?
Edouard