Thursday, April 2, 2009

Getting profitable by cutting the profitable

Anyone can speculate or make statements based on anecdotal evidence or familiar talking points. That's one reason I try to back my opinions up with real data when I can. I'm glad to say that with some new numbers, my opinion has once again been validated.

The Big Three American automakers have seen their sales slip nearly 50% year over year. In trying to get the company fit and trim, GM is pruning several makes, Saturn being one of them. In a somewhat recent post, I complained that GM is cutting profitable (or at least better selling) vehicles, like the entire Saturn Line, while keeping redundant makes like GMC (essentially gussied-up Chevrolet trucks and SUVs, but not as nice as Cadillac). Well, a recent report found that while GM's sales figures have slipped phenomenally, the Saturn Astra's sales were up more than 30%.

Let me repeat that. At a company that's seen sales plummet by nearly half, in an industry that's tumbled by nearly a third, GM considers the most prudent move to cut a vehicle that's actually seen a 30% gain.

There's simply nothing more to say about it. I rest my case.

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