Can GM revive Chevrolet?

A once-great American icon is losing market share. Can GM make Chevy attractive again?

By Bruce Kennedy Nov 27, 2012 10:35AM

A young man admiring a new car -- i love images/Cultura/Getty ImagesDecades ago, Chevrolet used to brag that it was as American as baseball, hot dogs and apple pie. But these days, America is moving on.


General Motors (GM) has seen slumping sales of its all-important Chevrolet line. The brand is reportedly losing market share to Chrysler, Toyota (TM), Jeep and Volkswagen (VLKAY). Chevrolet only had 13.2% of U.S. auto sales in the first half of this year -- down from 14.3% a year earlier.


Chevrolet has been a drag on GM in the two years since the automaker emerged from bankruptcy and returned to the markets. Still, GM's October U.S. sales were the highest they've been since 2007, with deliveries up 5% from to a year earlier and sales to retail customers up 7%.


GM can't afford to lose Chevy. So in this evolve-or-perish market, it's choosing to evolve by reinventing its brands.


The company will replace 70% of its U.S. nameplates with redesigned or all-new vehicles over this year and 2013. And the Chevrolet is the focus of many of those changes.


"They really started by revamping their entire product portfolio from top to bottom," says Alec Gutierrez, senior market analyst at Kelley Blue Book. And he points as examples to the redesigned Chevrolet Malibu, the new Impala scheduled for 2014 and the rebirth of the Camaro muscle car.

 

At the same time, Chevrolet and other U.S. automakers are aware that American consumers are buying smaller cars and paying attention to innovations like all-electric cars and compact SUVs. Despite its sales slump, Chevrolet is still GM's top-selling brand, and is taking the lead in innovation and change.

 

"A lot of people were curious as to why (GM) launched the Volt, a $40,000 premium electric vehicle, under the Chevrolet moniker and not, say, under Cadillac or even under Buick," Gutierrez says. "But I think it just proves GM's commitment to the Chevrolet brand as… a green-friendly company, on the cutting edge of technology. I think they're really trying to redefine what that brand means to consumers."


Gutierrez believes Chevrolet vehicles are currently on a par with its competitors, domestic and foreign, when it comes to quality and options. The big challenge for Chevy and its rivals, he says, is the rise of what were formerly second-tier companies in the U.S. like Hyundai (HYMLF), KIA, Volkswagen, Subaru and Mazda (MZDAF).


"The level of parity in the industry is so strong that you're going to see, in these high-volume segments, the market share becoming more and more diluted across all brands, versus someone like a Chevrolet or even a Toyota really dominating any given segment," he says. "I think segment share is going to be more evenly distributed among the major players as everyone kind of comes up to the same competitive benchmark. "

 

Chevrolet will soon get a new addition to its lineup in the Spark, an all-electric mini-car that will go on sale this summer in California and Oregon. The five-door hatchback is only about 145 inches long, the Associated Press reports. By comparison, Toyota's new Prius C is about 157 inches long.


Will Americans flock once again to a completely redesigned Chevrolet? The company is overhauling 13 Chevrolet vehicles in the next year. It's a risky move, but one that could make Chevy hot again.


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Tags: Autos
346Comments
Nov 27, 2012 4:57PM
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This is pure ignorance!  You'd rather buy a car from a foreign automaker than buy a domestic vehicle which has labor ties all through its supply lines.  Toyotas are assembled in the USA, not manufactured.  There is a difference.


USA Loyal
Nov 27, 2012 5:40PM
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I'm 22 years old and just graduated college in May, I had an 03 Dodge Neon and need a new car. Most of my friends seemed to go out and buy Scion TC's. After looking at them/riding around in them with a few of my friends I realized that I didnt like the cars much at all. I wanted something different that did better on gas then the TC's. Up comes the Chevy Sonic, which i first saw online and loved it as soon as I looked at it, as soon as i test drove it i was hooked. The next week i went to the dealer and picked up a new Sonic with the 1.4L Turbo and  I cant stop driving it! Got all the tech i need sat radio, blue tooth, ipod hookup, oh and the 40+ mpg does not hurt!
Nov 27, 2012 5:14PM
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Compare a 2013 Malibu to a 2013 Toyota Camry and you will

see why Chevy holds a higher footing in quality then Toyota.

Go to the dealer and stop listening to the status quo.

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I had a Camry.  It was a piece of crap.  Serpentine belt broke, Water pump went and passenger side window would go down after 5 years. It also slid all over the road in the winter.  I live in Cleveland.  I now own a Chevy Malibu(2 Years ) and havnt had a problem with it.  The Japs must have been drinking Saki that day!!!!!!!!
Nov 27, 2012 4:39PM
Nov 27, 2012 5:27PM
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I buy a new Silverado every ywo years and come out well trading up...try and do that with any other truck...and as far as maintance only oil and lube ...and thats no lie. Chevy trucks rock
Nov 27, 2012 5:03PM
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I thought the government takeover of GM fixed Chevrolet.  What? You mean the government cannot run a business!!!!! This does not bode well for Obamacare.
Nov 27, 2012 5:27PM
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GM is still bloated with the Union having control and that will eventually be the cause of its demise.
Nov 27, 2012 5:11PM
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Back in the day Chevrolet was considered the working mans car.  What I have seen as time passed a large portion the Chevrolet dealer body went from high volume, low priced, to High end, High Profit cars.  They seemed to want to sell one for a big profit rather than 10 for the same amount of profit.

 

I know Chevrolet/Gm got beat hands down in the entry level market primarily because of their dealer body.

 

Try finding a basic Chevrolet on a dealer’s lot.  GM provides them but dealers won’t stock them.  They would rather sell loaded to the hilt models like Cadillac Dealers.

Just like three years ago I wanted a New Avalanche, all the ones I could find in a 200 mile radius were all fully loaded.  I could have gotten a Cadillac Escalade EXT for the same as they wanted for those Avalanches.

Nov 27, 2012 5:36PM
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The biggest contributor to Chevy's sales decline is 20 years of fugly styling.  Harley Earl in the 50s and Bill Mitchell in the 60s designed some of the most beautiful Chevrolets ever.  It's hard to get excited about much of anything out of the Chevrolet styling department since 1970, except perhaps the C4 Corvettes.

There's just too much good competition out there.  Chevy need to step it up a notch or two.
Nov 27, 2012 5:15PM
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What you mean OBLAMA wasn't the Savior (with ur money) after all??? Don't tell Jaime Foxx!
Nov 27, 2012 2:54PM
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The Chevrolet Equinox is Fantastic !!  Looks like a mini-Tahoe !!   32mpg !!!$$$$$$$$$$$$$$$$$$$$$$$
Nov 27, 2012 4:41PM
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AS long as Ben keeps printing the bucks, GM & Chevrolet will not be allowed to go under (too big to fail).
Nov 27, 2012 5:32PM
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Hope you go down Chevrolet.  You shut us down because you thought we weren't big enough.  Why aren't all your BIG dealers selling?  We were current with all our bills to you and regular vendors and you still shut us down along with all the other small dealers who could give the everyday people the better price.   Just because we were small.  Good for you.
Nov 27, 2012 5:38PM
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If I had to venture a guess. I would guess that you probably couldn't find an American car with out foreign parts since prob the mid 1980's
Nov 27, 2012 5:46PM
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After trying to deal with their customer service for 2 weeks I can attest to the fact they will be dead.  They just dont understand that bad customer service=no customers.  I have bought chevy's my whole life but will never do so again.   I have had 5 actuators fail on my 2008 Tahoe and they refuse to pay for the replacement.  A simple google search shows thousands of complaints but they pretend like they do not know their is an issue.

Nov 27, 2012 12:08PM
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The 2013 Chevy Impala is hot.They`ll be winners again.The Volt is a disaster however.
Nov 27, 2012 5:17PM
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America is still love with muscle and retro designs. Look at the Camaro how well it's doing. The Monte Carlo of the 80's ('84-'87) which was a favorite at NASCAR and on the streets with it's 5 litre HO V8. They need to recapture what was tried and true to America. All of the imports from Japan, etc. all look alike in some form or fashion and GM followed suit. NO! Totally wrong to imitate. The electric car is out until you can manufacture it at a cost more affordable to the average driver. That ain't happening yet. GM is pricing themselves out of a market also thanks to the unions. This will always bite them in the **** and pocket book every time. The more demands and the more they give in, the more their vehicles will cost America. The imports don't have that burden to bear. The bailout preserved the unions and their take of monies. If they would of filed for Chapter 11, reorganization, you would of seen a leaner GM. You relected Obama to stay in bed with all unions and this is one of the big ones he must keep happy. They got him elected and he has to return the favor every day.  
Nov 27, 2012 4:58PM
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With all the computers necessary to make a car run today I'm just wondering when will Apple finally launch a vehicle? The iCar maybe?
 
Nov 27, 2012 6:07PM
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Simple:  Quality, style, popular price.  GM just can't put the three together. When they think they have the first two, they price it up there with Mercedes or BMW and they loose.  Face it, an 18 year old does not know Chevrolet ever was very popular, and the 60 year old can't forget the poor quality of any American car.   What is there to attract the buyer to a product with a high price and low quality history ? Nothing I can see !

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