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Discuss Auto troubles scare buyers in the alt.autos.gm forum at Car Dealer Forums; Auto troubles scare buyers http://www.detnews.com/apps/pbcs.dll...810160375/1148 Already anemic vehicle sales further depressed by stigma from companies' ...
  1. #1
    Jim Higgins
    Guest

    Default Auto troubles scare buyers

    Auto troubles scare buyers
    http://www.detnews.com/apps/pbcs.dll...810160375/1148

    Already anemic vehicle sales further depressed by stigma from companies'
    struggles for survival.
    Bryce G. Hoffman / The Detroit News

    Falling stock prices and increasing talk of bankruptcy are beginning to
    frighten car buyers away from Detroit's troubled automakers.

    As if high gasoline prices and tight credit were not enough, General
    Motors Corp. and Ford Motor Co. now have to contend with the damage from
    a steady stream of negative news stories, merger speculation and common
    shares that trade for less than the price of a double latte.

    Marketing experts say the bad financial news is eroding already weak
    sales -- proving why bankruptcy is such a dangerous option.

    "Right now, it's more GM than Ford. The bankruptcy thing won't go away.
    It keeps popping up. And it builds," said Wes Brown, a partner in
    Iceology, a California consumer research firm. "Subconsciously, it's
    already having an effect. If that talk continues, the effect is going to
    be even worse."

    Ford, whose stock price has dipped below $2 a share, acknowledges that
    its financial woes are also scaring off consumers.

    "The business coverage of the entire industry is definitely affecting
    consumer opinion," said Jim Farley, Ford's head of sales and marketing.
    "I definitely feel a huge obligation not to be part of it all."

    GM has lost more than $18.5 billion this year. Ford has lost more than
    $8.5 billion. Both companies have seen their sales fall sharply this year.

    Ford needs to address its business challenges in its advertising, Farley
    said. That means focusing on the wave of new cars and trucks the company
    is launching.

    "Our product cadence is really going to be a lot higher than our
    competitors in the next six months," he said. "The optimism for the
    company has to come through. We just need to explain our story."

    GM said maintaining the company's image with consumers requires constant
    vigilance.

    "GM has worked hard over the last decade to change consumer perceptions
    about our quality and products -- and we've moved the needle in this
    area," said spokeswoman Kelly Cusinato. "Now, with these tough economic
    times, we also need to ensure customers and employees maintain
    confidence in GM, its products and its dealers."

    Brown said that is getting harder to do with all of the bankruptcy
    speculation surrounding GM today, and he said that is precisely why it
    has to avoid filing at all costs.

    "As a business tool, bankruptcy would give them all that they need to
    fix the company. But it would be unbelievably damaging to their brand,"
    he said. "If you file, you can say goodbye to any customers for a
    generation. GM would be left with a 10 percent market share if they're
    lucky, and those will just be the loyalists. There are way too many
    other options out there for consumers."

    When consumer-oriented companies file for bankruptcy, it can devastate
    their brand image. Kmart, for example, never recovered from its
    bankruptcy filing and was eventually forced to merge with Sears.

    The danger to automakers is even more acute, Brown said, because many
    consumers buy cars to make a statement. The only statement bankruptcy
    makes can be summed up in a word: loser.

    Chrysler learned that the hard way when it was on the verge of
    bankruptcy three decades ago, he said. As the federal government
    approved its loan guarantees, consumers abandoned the company in droves
    and it took years for its brands to recover from the stigma.

    GM shares closed Wednesday down nearly 5 percent at $6.22 and Ford
    shares dropped more than 6 percent to close at just $2.30.

    Farley said he is confident that consumers will return at the first sign
    of good news.

    "I have a lot of faith in U.S. customers," he said. "They really love
    buying stuff."


    --
    Civis Romanus Sum



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  2. #2
    Gosi
    Guest

    Default Re: Auto troubles scare buyers

    On 16 Okt, 12:14, Jim Higgins <gordian...@hotmail.com> wrote:
    > Auto troubles scare buyershttp://www.detnews.com/apps/pbcs.dll/article?AID=/20081016/AUTO01/810...
    >
    > Already anemic vehicle sales further depressed by stigma from companies'
    > struggles for survival.
    > Bryce G. Hoffman / The Detroit News
    >
    > Falling stock prices and increasing talk of bankruptcy are beginning to
    > frighten car buyers away from Detroit's troubled automakers.
    >
    > As if high gasoline prices and tight credit were not enough, General
    > Motors Corp. and Ford Motor Co. now have to contend with the damage from
    > a steady stream of negative news stories, merger speculation and common
    > shares that trade for less than the price of a double latte.
    >
    > Marketing experts say the bad financial news is eroding already weak
    > sales -- proving why bankruptcy is such a dangerous option.
    >
    > "Right now, it's more GM than Ford. The bankruptcy thing won't go away.
    > It keeps popping up. And it builds," said Wes Brown, a partner in
    > Iceology, a California consumer research firm. "Subconsciously, it's
    > already having an effect. If that talk continues, the effect is going to
    > be even worse."
    >
    > Ford, whose stock price has dipped below $2 a share, acknowledges that
    > its financial woes are also scaring off consumers.
    >
    > "The business coverage of the entire industry is definitely affecting
    > consumer opinion," said Jim Farley, Ford's head of sales and marketing.
    > "I definitely feel a huge obligation not to be part of it all."
    >
    > GM has lost more than $18.5 billion this year. Ford has lost more than
    > $8.5 billion. Both companies have seen their sales fall sharply this year.
    >
    > Ford needs to address its business challenges in its advertising, Farley
    > said. That means focusing on the wave of new cars and trucks the company
    > is launching.
    >
    > "Our product cadence is really going to be a lot higher than our
    > competitors in the next six months," he said. "The optimism for the
    > company has to come through. We just need to explain our story."
    >
    > GM said maintaining the company's image with consumers requires constant
    > vigilance.
    >
    > "GM has worked hard over the last decade to change consumer perceptions
    > about our quality and products -- and we've moved the needle in this
    > area," said spokeswoman Kelly Cusinato. "Now, with these tough economic
    > times, we also need to ensure customers and employees maintain
    > confidence in GM, its products and its dealers."
    >
    > Brown said that is getting harder to do with all of the bankruptcy
    > speculation surrounding GM today, and he said that is precisely why it
    > has to avoid filing at all costs.
    >
    > "As a business tool, bankruptcy would give them all that they need to
    > fix the company. But it would be unbelievably damaging to their brand,"
    > he said. "If you file, you can say goodbye to any customers for a
    > generation. GM would be left with a 10 percent market share if they're
    > lucky, and those will just be the loyalists. There are way too many
    > other options out there for consumers."
    >
    > When consumer-oriented companies file for bankruptcy, it can devastate
    > their brand image. Kmart, for example, never recovered from its
    > bankruptcy filing and was eventually forced to merge with Sears.
    >
    > The danger to automakers is even more acute, Brown said, because many
    > consumers buy cars to make a statement. The only statement bankruptcy
    > makes can be summed up in a word: loser.
    >
    > Chrysler learned that the hard way when it was on the verge of
    > bankruptcy three decades ago, he said. As the federal government
    > approved its loan guarantees, consumers abandoned the company in droves
    > and it took years for its brands to recover from the stigma.
    >
    > GM shares closed Wednesday down nearly 5 percent at $6.22 and Ford
    > shares dropped more than 6 percent to close at just $2.30.
    >
    > Farley said he is confident that consumers will return at the first sign
    > of good news.
    >
    > "I have a lot of faith in U.S. customers," he said. "They really love
    > buying stuff."
    >
    > --
    > Civis Romanus Sum


    "maintain confidence in GM, its products and its dealers"

    It is obvious that confidence in GM has been slipping for a long long
    time so there is not that much to maintain any more.

    Now that the finance arm is totally in the shithole and the suppliers
    are being screwed the customers leaving it will not be long before the
    rats really begin to leave the ship and it can not be long now before
    GM goes belly up.

    It will be interesting to see if Ford and Chrysler will benefit from
    the death of GM or if they go the same way.

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