With Bob Lutz now in charge of marketing, General Motors messages should be more consistent companywide. But Lutz will have to delegate to pull it off, dealers and analysts say.
What Bob has right now is a lot of stuff on his plate, said Jim Hall, a suburban Detroit analyst with 2953 Analytics. When youre in that situation, youve got to make sure that when stuff falls off, youve got people there to pick it up.
CEO Fritz Henderson said today that Vice Chairman Lutz was unretiring. He will head marketing, advertising and communications and have significant input on product design. In February, Lutz had said he would retire by year-end after eight years as GMs product development chief.
Lutz, 77, has experience in sales and marketing. In the 1960s and 1970s, he headed sales and marketing for GMs European Opel brand and served as executive vice president of sales at BMW. But he hasnt handled those areas recently -- and never while he was heading product development, Hall said.
Still, combining product design and marketing could pay off in a spectacular way for GM, he said.
The personality of the product should always be integrated into the marketing. This gives them the opportunity to do that, Hall said. It isnt going to be easy.
To be effective, Lutz has to delegate, as he has done in other roles, Hall said. But executive cuts are coming, so its not clear who will work under Lutz. Henderson said today that GM will announce by the end of the month which jobs will be eliminated with his promised 34 percent slashing of the executive workforce.
The CEO said today that Lutz would work with design chief Ed Welburn and with Lutzs product-chief successor, Tom Stephens.
The new norm
Many GM executives may have to carry a heavier workload, like Lutz will do, said George Magliano, director of North American auto research at IHS Global Insight, a market research firm.
Everyone knows that you need to downsize. You need to streamline, and to do that, youve got to do things like this, Magliano said. This new world is going to be a lot tougher.
Dealer Gordon Stewart -- who owns four Chevrolet stores in Michigan, Florida and Georgia -- said if anyone can handle the big task of merging product design and marketing, Lutz can.
Most of the (recent) opportunities for brand advertising were just wasted, and I think theyve been stabbing around for a while, Stewart said. He wont keep stabbing around. Hell just pick one approach and go for it.
You have to create demand
Combining marketing with product design will allow GM to address its main problems: the perception of its vehicles low quality and the reality of their declining residual values, AutoNation Inc. CEO Mike Jackson said.
You have to be restrained in incentives, and you have to be restrained in production, and you have to create demand around these fantastic products, Jackson said. Bob knows this inside and out, and I think when he was limited to just the product, you didnt have one individual to be responsible for closing this gap.
In May, Lutz told the Automotive Press Association that GMs toughest challenge is erasing its reputational deficit. How do you change peoples minds? We dont have the answer.
During the talk, he criticized GMs customer-assurance advertising as not communicating clearly enough that the automaker would guarantee car payments for laid-off customers. And he offered a forecast for GMs marketing strategy after its looming bankruptcy: The minute were out, wed make a strong communication effort about how strong GM is.
Jean Halliday contributed to this report.