Analyst Asks GM CEO Mary Barra Whether GM Vehicles Are Less Desirable
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During GM’s Q1 2019 earnings call, a Barclays Capital analyst asked GM CEO Mary Barra a rather interesting question: whether the automaker’s products lack the desirability of key rivals, particularly when it comes to vehicle design and effective marketing tactics that attract buyers.
“We’ve talked over the years about the cultural change you did at GM and a greater focus on cost accountability, making sure you’re in the right product and geographies to drive profit,” asked Brian Arthur Johnson of Barclays Capital. “But one thing I do hear from investors is, if they look at GM design, broadly speaking, both the vehicles, the interiors, the advertising it just doesn’t, in some people’s view, have the kind of pizzazz as you might see. I don’t always like going back to Tesla, but it’s not lost on some of us that one of your designers created Elon’s vehicle lineup.
So just, how are you thinking about the state of design overall at GM? Is it an important differentiator? Or do you think it’s more important to get capable vehicles out there and kind of play it more on the profit and the cost game? And if it is more important, what would you — what are you trying to do to kind of move it to the next level?”
GM CEO Mary Barra responded with the following, providing some insight into the automaker’s thinking and processes:
“I think it’s incredibly important. You have to do everything to win in this market. And design is a very important piece of it. I think we have a very disciplined process where we clinic data and understand the customers in segment and what they’re looking for, how they view products. Full-size truck is different than a Cadillac is different than a compact SUV like the Chevrolet Equinox. And so, we have a very rigorous process on how we develop trucks and really focus on putting the customer at the center as we do those designs.
But all aspects are critically important. I think if you – you mentioned advertising as well. I think Cadillac is a really good example as you’ve seen the shift that we’ve made. And Steve Carlisle can do a better job of telling you, but the list that we’ve had with Cruise, with the right campaign has been very very successful. And I would also say, when you look at brand building, there’s been tremendous improvement across all of our brands and strengthening from the key brand metrics.
So we’re focused on having beautifully designed products that people want and desire and got to have to having the right contenting, so we could have the right package and efficiency and affordability for the customer and winning in the marketplace and then having advertising that breaks through. But sometimes the advertising that breaks through and is most effective with the customers isn’t the one that wins all the awards.”
2019 Chevrolet Silverado 1500 (pictured) and 2020 Chevrolet Silverado HD have been criticized for having less attractive styling and undesirable cabins
The GM Authority Take
That seems like a nice reply, but it still doesn’t really explain what the automaker will do to solve the elephant in the room, which is that a significant amount of U.S. car buyers do not desire GM, its brands or products when shopping for a car – whether due to prior quality or reliability issues, image-related factors, or an entire list of other potential reasons. It’s a serious problem, one that leaves GM competing for a smaller portion of buyers.
Meanwhile, some of the automaker’s newest vehicle designs have been critiqued for being bland or unattractive, including such models as the all-new 2019 Chevrolet Silverado, refreshed 2019 Camaro, and the all-new 2020 Cadillac CT5.
The refresh of the 2019 Chevrolet Camaro SS (pictured) was widely criticized, causing GM to do a quick refresh for the 2020 model year
In addition, the Super Cruise campaign mentioned by Barra might make for a good talking point, but its success is very limited. The spot in question – called Pioneers – isn’t focused on Super Cruise, but rather mentions it in passing, while also bringing up a whole bunch of other Cadillac attributes. But apparently, it’s effective.
Here’s to hoping that Barra’s actual plans to increase the desirability and purchase consideration of GM and its brand and models are better than the answer that was given to Barclays’ Johnson.
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The proof is in the pudding, Mary. Not very scientific, but I observed much less buzz at GM displays in comparison to foreign brands at Detroit and New York auto shows this year. At Detroit’s Cadillac presentation, the biggest excitement was found around the ’59 Eldorado. I’m a long time GM customer, but my next transaction will most likely be with Toyota, Mazda or Kia.
what kind of trash would you buy at one of those 3?
The Mazda CX-5 for one, and it is way better than the highly overpriced Equinox/Terrain
Its Funny you say over priced When it Almost Number one selling units in its class….. And Design on the Equinox is way better then half the models out there. Must be a reason why Gm Sells so many . look up the numbers rogues down and equinox and crv up!
Mazda is beautiful design and fun to drive while Kia looks great.
I can’t figure out why GM design is so bland, even poor. Malibu’s exterior is adequate but interior design is pathetic.
Design and marketing are the two great differentiators. These elements are key to branding. Subaru, Mazda, PSA and FCA are going to strip GM of both profits and market share. Chevy is a very weak brand is many markets. Even I prefer Honda, Mazda or Chrysler /Dodge.
The problem with GM is that no one really wants their products. Chevy has some decent looking vehicles but some are just plain ugly (Malibu, Spark, former Cruze and Sonic). Buick has a line-up that has boring names and GMC is too expensive and has ugly vehicles and Cadillac has already los the battle and is also pumping out ugly vehicles such as the XT6. Come on GM, you need to rethink your vehicles.
The Cadillac CT5 is a good looking vehicle at least.
The Silverado interior is a problem. Chevrolet also needs some affordable “cool” cars similar to the Kia Soul, etc.
Very simple fix.Make better interiors.
That is what consumers are clamoring for in todays marketplace.
Look what happened to the last Gen VW Jetta. They offered a Cheap interior and they couldn’t give them away.
Todays buyers mostly have no clue about Power-trains. They care about Tech and amenities. Every single person can tell a good quality interior compared to a subpar interior. This isn’t that hard.
Exterior Design is fine at GM and so is Power trains for the most part (even though GM refuses to go All In with Cadillac)
This X 1000. (Plus lame commercials, at least the Chevy ones).
What would she know about design? She is wearing a scarf! around her neck as an accessory. She is as frumpy as they come – witness the altima blob masquerading as a new cadillac.
One more thing too. Besides the Vette and Camaro, GM has no Niche Cars to get people to the Dealerships.
No Raptor Competitor
No GTI Hot Hatch Competitor
No Cadillac Roadster
No Cadillac Convertible of any kind
No Cadillac Luxury EV
No Wrangler Competitor
No 4Runner Competitor
No Charger High Performance Sedan Competitor
Did I miss anything?
GMC should absolutely have a 4 runner and Wrangler competitor but alas the financial discipline won’t allow it. The time it would take to build the recognition of the vehicles isn’t something GM seems keen on
Agreed. That is the main issue.
GM is never willing to play the Long Game.
Yes, No EREV (eg Voltec) or PHEV competitor. Other than the PHEV (EREV) Honda Clarity, that market is wide open and could be easily taken from Toyota’s pathetic Prius with just a modicum of effective advertising. Why is GM management (not just Mary) so tone deaf? GM’s original plan for the Volt and it’s sister EREV CUV in 2022, properly marketed would have put GM at the top of the EREV segment and perhaps even the entire general PHEV segment.
IT appears we have been on the same wave length lately. To me it’s obvious that all of their Bland vanilla products are the result of a still stuffy, bean counter run overstuffed corporation. As to your question – yes you also missed none of the many promised electrified products out yet while competitors begin to move in with what soon will be an onslaught. Gm built a great product in the Volt and although both gens had compromises, we find our ’13 to be the best car we ever owned ( a common sentiment among owners), my neighbor is on his seventh, Yet GM did their best to insure paltry sales and dumped it BEFORE having a viable replacement for it. The Bolt could be that but is clearly hampered by compromised, cost cutting efforts (range, cheapness, no AWD, size, etc.). Unless they put products where their mouths are my next purchase will not be GM. Hell I might even go down the street to the blue oval if they deliver on their big EV promises.
Most of the products you list here ( the three Caddys excluded) went “all in” to fill a nitch and did it well at a good profit. GM currently only has one product that fits that description in my estimation and it comes out of Bowling Green. It bears saying here that the bean counters tried to kill that as well a few years back. I shudder to think of a world without a C7 or C8. I like Mary as a person but maybe Gm needs a stronger leader at the helm – ala Lutz – but maybe with a little less ego.
And the comment below by K hits it on the head. It takes long term vision and commitment to it, to create the kind of loyalty that 4 runner , Jeep and others enjoy. “financially disciplined” products create this dog chasing it’s tail” (stock price) effect. My comment every time I see a dog doing that is “what a retarded animal” – yes PETA I actually say it!
Yes, you did: Reliable vehicles to compete with the Japanese (and now the Koreans, who, oh by the way, were not even on the radar a couple of decades ago. But they learned – GM has not).
No performance suv!
Very true. I forgot that Segment.
This is the most ignorant comment I’ve seen in a long time. Just about every one of those vehicles is from a different car company. You could make that same list for every company with minor variation.
So, are the results of the “…very disciplined process where we clinic data and understand the customers in segment and what they’re looking for, how they view products” edited and manipulated in the same way as in the ‘Real People, Not Actors’ ads…before they’re presented to upper management? …and filtered through the bean counters?
I looked up the Tesla reference: Tesla design chief Franz von Holzhausen was responsible for the Solstice/Sky under Lutz. That explains a lot…
I don’t know if you can call Tesla’s designs – designs. They are wind tunnel exercises that they made enough room for passengers. The model S for its size doesn’t have good rear seat room leg or headroom. And the model 3 rear seat you feel like you’re sitting on the floor. The Model X was probably the best “design”, but they the made the unnecessary rear doors. And finally, the Model Y is a tall model 3. And don’t even start with interior design.
Granted, there definitely are some objective weaknesses in the design (inside & out), but those factors aren’t hurting the aspirational nature of the Tesla brand. The cars are selling in spite of those (and build quality) deficiencies, and there’s still something mildly exotic about the appearance. Maybe it’s just that the novelty hasn’t worn off yet…in any case, there are more Teslas than Cadillacs in my area.
The novelty hasn’t worn off yet. That doesn’t make GM’s problem any less acute, though. Betcha there are more BMWs, Mercedes’ Lexus’, and even Hyundai Genesis’ than either of them.
Objectively, yes – there are more BMW, MB, Lexus, & (probably) Genesis cars on the road in my area than Cadillac or Tesla. Each of those brands has some intrinsic value for the luxury buyer, whether that’s ‘instant status’, reliability, or bang for the buck. Tesla brings a technological tour de force with a reputation for ‘holy crap!’ acceleration. Cadillac has a long legacy of cultural significance as a luxury marque, but aside from teased concepts, Escalade, and the V-series cars, they haven’t done well to drum up any sustainable product lust. The best reason to buy a brand shouldn’t be depreciation…
Interiors across the board could be so much better. The CT5 has the same exact layout as the CTS – note the door handles, steering wheel, switch gear, the shape of the speakers. It’s an improvement but the car was definitely constrained by a budget. I don’t mind that the XT6 has the same layout as the XT5 but it should have come out much sooner. Drove a Malibu rental the steering wheel felt like cheap rubber in my hands.
GM design is lacking the passion and vision the American auto industry once pioneered. The approach on interiers is abysmal. When you brag about selling fewer vehicles yet a higher ATP to offset sales declines, your business model is flawed. Its apparent loyal GM customers and customers considering GM for the first time are taking notice.
The GM authority take, is a bull’s-eye. MBs response shows how incredibly deaf senior management is at GM. Their process does not allow for the recognition of failure. She said their process is very very successful when it is completely not successful, And not only do media outlets harshly criticize even GMs most recent products, but the marketplace is responding as well. These idiots have blinders on and are ruining General Motors.
You can throw a lot of crap on the wall here and while some of it sticks much does not.
Cool cars. Yes they get press and people desire them but most do not make much if any money. Trust me I love cool cars and own a few but most are failures in the market place.
Much of what GM has today is not really bad. The real issue is the details of some of these products that kill the appeal.
Better interiors or interiors that are much more than just Jet Black. GM about ten years ago put a red and black interior in the HHR SS and Cobalt SS that while it was not expensive looked much better just because it was black swede and red leather. Imagine the Blazer with a Red and black interior vs the drab black. The interior does not live up to the exterior just due to the colors for the most part but also feel.
It is like when Lutz was here. GM was going to cut the chrome around the windows in the Impala to save money. Lutz went on and added it as it gave the car a more added value look even for a few bucks a car.
He asked the designer what would sell better and the designer said with the chrome. Lutz said it is better to get in trouble for spending more and selling more than failing due to poor sales.
GM also needs to focus on decreasing issues on all products large or small. Toyota sells millions of non desirable cars just on perceived quality alone. Just imagine if they had the visual aspect down what they could do.
Right now GM has a lot of very good CUV models. Most of them are lost in the crowd due to poor marketing. My Acadia is a great vehicle but I only see it marketed with GMC discount advertising. Not a way to say this is a must have vehicle.
The details are what is needed.
We must also remember just building cool cars is not a sure way to success. GM had a lot of cool cars as they went int Chapter 11. They are ok for gathering attention but they alone will not fix what is wrong.
It is the average everyday vehicle that needs to be reliable as snow in the arctic and feel like it cost more than it really did.
Yuck. The excessive use of chrome around windows and everywhere else is part of the problem.
Dome it was just an example and what they did use was not excessive. The story was just to point out you can spend just a little more to make something more appealing to more people as they will see more value in it than without be it chrome or any other kind of trim.
All things are in moderation.
I agree with Dome. some unnecessary chrome paint on the plastic is 2000 and late. Also they should start offering mate colors.
Been saying it for years, now.
GM’s cars are bland; foreign looking.
Cheap interiors …ugly Buick cars !! GM is failing cusumers at a all time high and are not willing to change and make better car and trucks but still want to charge big money for them .They will fail ultimately…
The auto industry historically always swings from one end to the other. Many times as the designes win over the customers, the bottom line gets hurt since it’s engineers and designers making the call. To fix the bottom line financial people take over to get the financial house in order. When design surfers again, designers and engineers get more of a say. It is very difficult to get both in balance. It can but at the monument most auto companies are putting their money in EV and autonomous development, so it takes money away from design.
The new Blazer is one of the coolest, sharpest looking CUVs I’ve seen yet. The new C1XX CUVs are pretty sharp too. And no, I don’t work for GM – lol
I agree. GM exterior is just fine. The issue with GM is that for whatever reason they still have failed to understand just how important the Interior is for sales. Consumers that cross shopt can 100% see and feel the difference between GM cars and their competition. I agree with you about the Blazer. Very cool exterior design. Even the interior design is nice until you realize just how much Hard plastics are in it. I mean the Upper Door arm rests are Haaaaard. The Blazer goes up to $55,000 and Materials like that are unacceptable for a lot of consumers. Only GM does this on mostly Chevy vehicles. The Nox is the worst offender. The interior materials are borderline awful. Great Infotainment and Seats though.
My take,
The Customer service or “NON CUSTOMER SERVICE” has ALOT to do with GM and its desirability.
The low power ” on the road ” per vehicle resistance and weight is a factor.
GM says this engine makes this HP/Torque but if you cant make the car move or perform on the road it doesn’t matter what the engine HP/Torque is. ( transmission troubles — shift points — gearing — rev, rev, rev, no go ). Sure the average GM vehicle is average, but that’s it AVERAGE !!!
The overall look of MOST GM interiors is simply BLAND — BLAH, sure some high end stuff needs better materials but the average material is good enough for the average vehicle, but the interiors just look BLAH — BLAND !!!
And the price,
Its like the top GM thinks there vehicles are simply better !! If we charge more they are worth more. GM has used this strategy for most of my adult life, and for the most part it has worked, if you stick with GM. This is however, in my opinion, no longer working or going to work. With the competition now making a better more reliable vehicle, and taking WAY better care of their CUSTOMERS, for equal to less money GM is simply loosing market share.
Just look at two examples :
Move from a GM truck to a RAM. The RAM is cheaper, so an old GM owner would say it is cheaper built and therefore cheaper. A new GM owner says GM just profits more on the truck than RAM and uses that profit for the shareholders !!
When you have troubles with the RAM, FCA will take care of you just as good as GM when you have troubles with the GM, and GM as of the past two or three years, FCA take WAY, WAY, better care of you.
So as long as you continue to purchase RAM you will be fine, the new truck is cheaper and you will get less for your used one so its an even trade.
Now for the other comparison,
Lets say Audi — you can get an Audi with more options and more power than an equal or higher priced GM. You get a SO,SO, SO much better CUSTOMER experience. It is SO OBVIOUS why Audi has ate Cadillacs lunch for the last X years. GM just will not compete !!
So design looks of a vehicle are subjective to each persons eye !!
Cost of ownership is NOT subjective !!!!!!!!!
Dealing with RUDE, LYING, Customer support workers is NOT subjective !!!!!!
Getting fewer options for your money is NOT subjective !!!!!!!
Loosing market share is NOT subjective !!!!!!
I simply think the GM MACHINE is to large for the top management team to handle and the top management simply wants a smaller GM. They just don’t know how to get there without the shareholders dumping them.
GM for years has been mostly focused on China, as has the GM investor. We will see how the China deals turn out but one thing for sure is, China now has GM vehicles. China will make GM vehicles weather GM share holders get any money or not. When China thinks it has sent to much money to the USA, China will stop sending it, kick GM out, and simply take over the GM plants in China.
This will all work itself out in the next 6 years !!!
I believe the question is one that all GM dealers are asking, and the lack of sales in the new models is a testimony that the designs (interior and exterior) are not gaining new consumers.
Years ago Patrick Bedard said in Car and Driver, “It’s all about the product.” Lifelong GM owner above said it correctly: “GM just will not compete !!” Maybe GM just cannot compete. Except for the Corvette and Camaro (and that is iffy), there is no segment in which GM leads the way. In every category – reliability, design, performance, utility, etc., someone else is the leader and GM is way down the list.
In the comments above design seems to be equated with styling. GM is not bad on exterior styling, but design is a more comprehensive term and in its other elements GM is lacking.
I really is all about the product.
Yes, it is about the product. And if I allow myself to be repetitive, they had a product that, within its admittedly narrow segment, was as excellent as the Corvette and Camaro. The Volt was, without a doubt, the undisputed engineering leader in the PHEV/EREV segment and, with reasonable marketing, could have been successful and, given sufficient production volume, perhaps even reasonably profitable. Look how long it took the foreign competition to come up with anything even remotely competitive.
Would that not have been an outstanding introductory (and proof of capability) product for “GM’s (Cadillac’s ?) all electric future”? Instead, Mary Barra et al made the Volt into what appears to be a failure (it wasn’t), with only the humble and unremarkable (and failing?) Bolt as it’s only current entry in the BEV segment.
Of course she is going to say styling is very important and they work hard to get it right.
The fact that investors are even asking this question indicates they may not be succeeding as they would like.
What a shame. Management has their head stuck so far in the sand they can not see the real world around them Ego is not a good thing sometimes. First, it does not matter about power or looks as long as their products keep falling apart. I do not care if I have a nice looking and powerful vehicle if it is sitting on the shoulder of the highway waiting for the tow truck. Second, look at the general public in 2019. I do not see many 4’6″ tall 75 pound guys (or women) out there. Produce a vehicle with a decent seat that is comfortable for normal people. Also, some shoulder room would be nice. Having to roll to the side to shut the door is a little annoying. Small minds have small thoughts. I think that is the biggest problem. This is my seventh (7th) GM vehicle since 1994, sprinkled in with other brands, and I am not sure I will even consider another GM product when my lease is up in a couple of months. Again, what a shame !
Adding a follow up comment. I replaced my 08 Ford Edge in December. I was eyeing a used Grand Cherokee High Altitude and when one popped up in my area with the color I wanted I jumped but didn’t pull the trigger. At 25 I don’t need that type of car payment. Parents are GM loyalists – GMC and Cadillac all my life with some Buick mixed in. They tried to get me to look at Chevy and GMC for SUVs but there wasn’t anything I desired. The equinox is not my style, terrain is ok but nothing special. Ended up leasing a 19 Cherokee with everything I wanted – heated seats/mirrors/steering wheel, LED lights, v6, 4×4, and a sport mode that is actually sporty with awesome throttle. All for $250 a month. I considered the Blazer when it was revealed but pricing for what I wanted is INSANE. If I wanted to live outside my means I would have went with a Caddy lease or full size SUV, but I don’t need that and street parking would be a PITA. GM didn’t have anything for me so I looked elsewhere. I know people my age that love their Cruise/Equinox but they’re way too bland for me. Not surprised others feel the same
Nearly every review and reader’s comments I have come across, have blasted all if not most of GM’s interiors.
As well, at least 90% of the opinions I’ve read are negative against the new Silverado, and Camaro.
We’ll see how the buying public reacts to the new Cadillacs when they go on sale. So far, the opinions
have not been very convincing.
The lack of standard features, with higher prices than the competition, has also been called out. Making the public’s
perception of GM as a car company that phones it in without passion. Pure greed.
Mary is just a puppet living in a bubble. The powers that be, are short sighted, and this will not end well without
true and clear, uncompromising leadership.
Hurry GM. Time is catching up with your cost-cutting and designs that miss the mark.