The troubles that prompted General Motors to phase out its Oldsmobile brand have been brewing for years.
Some of the problems, such as increasing import competition, were unavoidable. Other problems were of Oldsmobile's making, such as uncompelling marketing.
Lack of trucks
Oldsmobile did not get into the light-truck market until 1989 and then offered the Bravada sport-utility and the Silhouette minivan. Both models performed poorly in an era of booming truck sales. The Bravada did not come in a two-wheel-drive option, which many non-Snow Belt sport-utility buyers prefer. (The next generation will offer a 2wd.)
Chasing the wrong buyers
GM tried to redirect Oldsmobile to younger buyers, giving dealers new and sportier cars with an import flavor. That mission has been somewhat successful. But as one retailer explains: 'We gave up a lot of good old customers in the change. They were older customers, but they liked the product and they let you make a profit. So now we sell Aleros to young people. The problem is I've got to find four Alero buyers to make the return I did on one Ninety-Eight customer.'
Ron Zarrella, president of GM North America, said last week that Oldsmobile had found new customers - but not enough of them.
Too many dealers
Oldsmobile sold 1 million cars through 3,100 retailers in 1986, an average of 334 sales per store. Last year, the average fell to 127 sales per store as sales declined. Yet few dealers bailed out of the brand. The dealer census is down by less than 10 percent since 1990, despite GM's efforts to reduce retail head count.
As sales and profits declined, Oldsmobile dealers concentrated on their other brands, both GM and non-GM. The brand has only 63 stand-alone dealerships. Oldsmobile largely lost the battle for dealers' share of mind and couldn't break out of the downward spiral.
Oldsmobile struggled to capture the public's attention. Its 1988 advertising campaign, 'This is not your father's Oldsmobile,' drove home the point that consumers weren't sure what Oldsmobile was. The brand was supposed to fit between sporty young Pontiac and the higher-status Buick, but the crowding of the U.S. market in the past 20 years and the proliferation of products made brand boundaries harder to see.