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Is GMC a core brand?
Feb 23, 2009 1:16 PM

GMC-Sierra-Denali-grille Growing up, my Mom’s side of the family was a “GM family.” Everybody drove a GM car or truck. Nothing fancy -- usually a Chevy truck or Impala or Caprice Classic sedan, with the occasional El Camino or old Corvette for spice.

My grandparents were no exception. They always bought used and then drove them a long time. Biannually my grandfather would fire up the compressor in the garage and repaint his Chevy truck, keeping ahead (barely) of the rust. Those trucks were always in garish colors -- two-tone orange or yellow with white -- because he could get the best deal on those.

But near the end of his life, my grandfather decided to treat himself to a new truck.  This time he would pick the color (road-crew beige…think of DOT-issued vehicles) and the options -- two-wheel drive, no A/C, 4.3-liter V6. And he picked a GMC Sierra; he wanted his last truck to be a “nice” one because he deserved it. He knew that the GMC and Chevy came off the same assembly line, but he felt that the GMC was just a bit “nicer.”

Fast forward almost 15 years later. GM recently drew its line in the sand and named their four “core” divisions, brands they just can’t live without. Chevrolet (an obvious one); Cadillac (makes sense as the upscale marquee); Buick (well, the brand is popular in China, and the new Lacrosse looks much improved). And then there’s GMC. Really? And yes, Saab is pursuing bankruptcy protection and Saturn may be spun off on its orbit.

Don’t get me wrong—if I won the lottery, I’d fit a Sierra Denali into my fleet. GM’s restructuring plan presents GMC as “Engineering Excellence with Capability and Functionally”(sic). But GMC’s products remain, just as my grandfather’s Sierra, essentially identical to their Chevrolet counterparts. There isn’t really a difference in engineering excellence or “functionally.” (Yes, they could build a high-line Silverado with the Denali’s 6.2-liter V8 and AWD.)

Sure, it doesn’t cost much money to badge-engineer these trucks, but it does cost something. Cadillac and Buick exist to sell upscale SUVs, and the pickup truck market is (forgive the pun) contracting.

So why keep them? The likely reason: GM’s dealer lineup needs it. GM worked to split dealers into Chevrolet-Cadillac and Buick-Pontiac-GMC franchises. With a limited Buick product line-up, and the fracturing of Pontiac into a niche brand, that wouldn’t leave much volume for those dealers without GMC.

To that point, turning Pontiac into a niche brand seems redundant, as well. Selling a Solstice (or Sky) next to a Corvette seems a natural: go to dealer, look at Corvette, can’t afford Corvette, buy Solstice/Sky. And the Pontiac G8 would make the best Impala SS ever. Killing off low-hanging fruit like the current Pontiac G6, G5, and the announced G3 Aveo-clone eliminates some mediocre cars. But it also leaves that dealer channel with no practical car cheaper than a Buick Lacrosse.

It’s debatable if what’s best for those dealers is best for the company as a whole. You get the feeling that if GM had to do it from scratch – or bankruptcy? – it could just be structured as Chevrolet and Cadillac. However, GM can’t afford to buy out all of those other dealers, so they need them remain viable and continue to deliver product. And killing that many dealers would put a lot of sales and service staff out of work, plus impact current car owners.

I know that brand loyalty runs deep with some, and a lot of people may think that the GMC is indeed a nicer truck. But in the end, if GMC had folded, I’m pretty sure my grandfather would have bought a Silverado instead of the Sierra. And I doubt he’d be alone.

Tom Mutchler

Read "Detroit report cards" and "Car brand perception survey."

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