Buick LaCrosse, Chevrolet Malibu Drive GM to Q1 Profit
For the first time since 2007, General Motors is back in the black (on a quarterly basis), turning a net profit of roughly $900 million for the first three months of 2010. Although that's about half of the profit posted by Ford during the same time, GM's numbers are notably right in line with those from companies like Toyota and Hyundai. GM's core brands performed surprisingly well, and it seems obvious that customers who recently wouldn't even think of visiting one of the General's dealerships are now buying from them. Just as significant are the kinds of vehicles being bought'”like the Buick LaCrosse and Chevrolet Malibu'”which bodes well for the sustainability of GM's success.
It all starts with the LaCrosse, which, in many ways, has become one of the icons of the "new" GM. Yes, it technically rides on a pre-meltdown platform, but the car received some stunning new sheet metal for the 2010 model year and its underpinnings have been nicely updated as well, especially with the addition of GM's "HiPer Strut" suspension system.
The result, thanks to a dose of good timing, is a car people can point to as concrete evidence of GM's ability to built better products that customers really want to buy.
Look at it this way: The Cadillac CTS also can be thought of as a transitional product between the pre- and post-bankruptcy GM, and actually had a bit of a head start on the LaCrosse. The previous models of the CTS were much ahead of the previous Buicks, and the current Cadillac also received some notable recent enhancements. But one of the key features that makes the CTS and most of Cadillac's other vehicles stand out'”their design language, which features aggressive use of planes and sharp angles'”is simply still too radical to attract a significant public following.
That probably goes a long way toward explaining why the CTS is having a tough time in the market this year while the all-new Cadillac SRX, which eschews the typical Cadillac exterior for a more-rounded appearance, has seen sales shoot through the roof. At the same time GM was piling up that first quarter profit, CTS sales were falling by 23.2 percent and SRX numbers climbed by an astounding 425.2 percent.
And the SRX, for its part, doesn't have the package of all-around selling features that makes the LaCrosse a better new face for GM. (By which I mean that Cadillac doesn't seem to have given even a nod to telling a strong fuel-efficiency story with the SRX, while Buick is offering a four-cylinder engine beneath the LaCrosse's hood.)
This means crossing Cadillac off the list when we're looking for potential GM poster boys.
Of course, fitting a GM halo atop a GMC product is a stretch as well. The division's lineup is still distinctly representative of the "old" GM, except for the GMC Terrain, and that crossover can't offer anything the Chevrolet Equinox can't, outside of its more aggressive styling.
So, what about Chevy? The Chevrolet Volt and Cruze will, in theory, epitomize the new General Motors in all its glory. But not until they are actually on sale, and that won't be for some months yet.
There is the Equinox, but even though it's a fuel-efficient wonder (32 mpg on the highway) and even though it followed the same path as the LaCrosse (it's a pre-meltdown product that's received significant post-meltdown upgrades), and even though it's in one of the country's hottest segments (mid-sized crossovers), and even though it's routinely put up triple-digit sales jumps this year (nearly 130 percent for Q1), the Equinox hasn't been able to escape its Chevy roots.
That is, it's just too much of a mainstream, family-oriented vehicle to attract the kind of excitement GM needs to keep the buzz-o-meter ticking until the Volt and Cruze arrive. And remember, the Equinox is still outsold by cars like the Chevrolet Malibu and Chevrolet Impala. But in a way, that's good news, too.
Solid sales numbers of these Chevy sedans, both up about 39 percent in the January-March timeframe, show how GM's momentum is spreading throughout its core divisions.
It's as if the LaCrosse's ability to hit the industry's sweet spot'”it's edgy, but not too edgy; luxurious, but not too luxurious; etc., etc.'”is both convincing and reminding customers that GM has plenty of sugar left over for other segments.
Well, either that or those Ed Whitacre commercials are working better than I ever thought they would.