Why the merger of GM and Chrysler could make branding sense
From my branding standpoint, the benefits of a merger between two of the big three automakers is potentially huge. While both GM and Chrysler have been hemorrhaging money, the opportunity to pare their respective brand portfolios along with the development costs of vehicles, engines and alternative-fuel technologies might give the merged company real market traction.
My recommendation would be to drastically prune the combined brand portfolio on both sides of the house. Pick no more than 5 brands (Jeep Chevrolet, Dodge, Cadillac and maybe Saturn) and toss the rest including Chrysler, Pontiac and Buick. In other words, get rid of whatever components they don’t need. It hasn’t been easy to watch these iconic brands lose their way, but it’s been easy to see why they have. With fewer brands to focus on the company will have a better chance to compete on the global stage with Toyota, Honda, and BMW.
On top of that, a lean mean auto company might also benefit from a “Made in America” branding spin in the short term. And wouldn’t that be nice? But I believe if these two companies focus on where they went off the track and make some hard choices now it might be possible to put an American car back in a leading-brand driver seat.
November 30th, 2008 at 10:09 pm
I couldn’t agree more. My only question is whether the two companies could sufficiently merge their operations. Are there enough operational synergies to make a GM-Chrysler merger work? Or is it just too cost ineffective? One of things that doomed the Chrysler-Daimler merger was lack of operational synergies. Given how much trouble both of these companies are in, any merger would have to be pulled off efficiently, and I wonder whether either company’s management is up to the task.