AUTOLINE ON AUTOBLOG: How Many Brands are too Many?
June 22nd, 2008 at 6:27pm
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With gas prices soaring and SUV sales sinking, General Motors just put its HUMMER brand under “strategic review.” That’s generally the term used when a company is getting ready to dump a brand. And that begs the question . . .
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Comments (2)
June 23rd, 2008 at 12:19 am
I believe that it’s OK to have more than two lines, as long as the lines are distinctive.
When Ford Jaguar, it would make no sense to rename the Division, Lincoln. Also, it would have hurt Volvo sales to merge Ford and Volvo.
The problem U.S. automakers have is very little distinction. What was the difference between a Olds, Pontiac, or Chevrolet? Or between a Plymouth or Dodge? Or Ford and Mercury?
There is a difference between a Scion, Toyota, Lexus, and Prius (if that occurs).
I actually think that having a Hummer Division is OK. The problem is that Hummer only sells three, inefficient, similar looking SUVs. It’s the three vehicles that they sell that needs to go away. It’s bad that the Hummer division doesn’t offer fuel efficent vehicles.
The sales of the H1, H2, and H3 would suffer even if they were Cadillacs.
June 24th, 2008 at 8:29 am
“I believe that it’s OK to have more than two lines, as long as the lines are distinctive.”
John’s point is centered on economies of scale. In the end, economies of scale will win.
“Destinctive” costs money and is not economic.