General Motors Co. has been cornered into a tough position due to the fact that they have failed to produce quality vehicles to consumers. 30 million vehicles have been affected by the recall across GM’s multiple different models; in particular, the recall of 2.6 million cars with defective ignition switches linked to at least 23 deaths [1]. GM’s plans for the future include continued growth of models into China along with the re-instation of Cadillac as a luxury car brand [2]. Because of the recent blow to GM’s “image” in the automotive industry, the company must re-establish itself as a brand that consumers trust and can be excited about. In order to do this, GM has to divert the negative attention away from their product by attacking a different market/customer segment. GM can apologize all they want for their manufacturing defects, but fixing the defects of their old models won’t help sales in the future. Lack of awareness of Cadillac from a consumer perspective [3] poses an opportunity for GM to push into the expanding luxury car market in China. GM can regain consumer trust and market share by creating a differentiable high-quality vehicle that can outperform, as well as compete, with top brands such as BMW and Mercedes. However, GM must have a flawless growth strategy in production in order to return to profit and re-establish their brand at the top of consumers’ minds as GM is currently under the microscope.
GM’s Cadillac CTS-V
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Sources:
[1] Ben Klayman, “GM recalls more than half a million vehicles,” The Globe and Mail, Oct. 3rd/14
[2] Joann Muller, “GM Chief Outlines Growth Strategy,” Forbes, Oct. 1st/14
[3] Jeremy Cato, “Haven’t we seen this one before? The Cadillac saga continues,” The Globe and Mail, Sept 25th/14