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GM Stumbles, Sees the (Green) Light

Like most Americans, GM made some bad strategic choices in the last decade or so and has come to regret it. Bob Lutz called hybrids an “interesting curiousity” and went on to pump out big SUVs to help fuel bronco-busting ids and assuage the fears of soccer moms.

GM certainly understood the zeitgeist of the time. Men wanted to feel macho and women wanted to feel safe. The SUVs projected attitude and promised security all while wrapped in all the comfort and luxury you could afford — and by the way we’re not PC so the hell with those pleasure-hating red environmentalists.

So now that there is no joy in Mudville, GM is playing catchup. Fortunately, America loves the home team…and turnarounds…and ‘come to jesus’ moments. So, hopefully, the company that once represented and embodied American industrial might can regain some of its market power. But how could they not see this coming?

Their focus groups kept driving them towards bigger is better--and GM is a market-driven company. While Toyota and Honda kept nibbling at the edges Americans still loved big cars, SUVs, and trucks. No one does BIG better than Detroit and those were the vehicles that sold. No one at GM expected gas to go this high this fast or the falloff in sales to be so steep.

Its not that they don't get the technology. They've had lots of very interesting concepts over the years--cool technology that just couldn't make it to production. From Sunracer in the '80s, to the EV1 of Who Killed the Electric Car? in the'90s, to today's Hywire and Volt concepts, GM's stable of green concepts has always generated buzz but has rarely led to market. If the hot money leaves commodities for alternative energy and oil prices fall, we may go back to business as usual and bozo behemoths may once again dominate the sales charts. Even so, I think a chastened GM has found religion and will bring at least some of these to market as quickly as they can.

The world has changed and no corporation is too big to fail but some do get second chances. Being a great company means seeing beyond the curve...or the next quarter...and making big bets that count. GM seems to at least be making the bets.

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