Brands,Are,Expected,Change,Det car Brands Are Expected to Change in Detroit
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Currently, General Motors, Ford, and Chryslersell a total of 112 models and offer 15 different brands to choosefrom, and thats in the United States alone! Those are high numbers,especially considering the steep sales declines faced by many of thesebrands. By comparison, Toyota, Honda, and Nissan offer only 58 modelsand seven brands.But the US automakers are not necessarilyentirely at fault. The Big Three once dominated the auto market, andoffering a slew of brands was a strategy that helped them become salesleaders. However, these once powerful automakers now account for underhalf of all new vehicle sales in the US, and their market sharecontinues to slide.While having a multitude of brands used tomake sense, that same strategy is now depleting budgets, increasing thenumber of designers and engineers needed, and also causing strain onmanagement and dealers. For example, Detroit Chevrolet dealersnow have to compete against dealers offering re-branded variants ofpractically the same cars just down the street. The radicalproliferation of models and brands has certainly contributed to highcosts for the automakers. To make matters worse, Used Cars Springfield MAbelieves this strategy has also has caused domestic automakers to movein accordance with adverse business and financial issues at a muchslower pace.Among the cut backs that the Big Three will have tomake are the ridiculous salaries. For example, Alan Mulally, Fordschief executive, will reduce his $21 million salary to a mere $1.Additionally, Ford will be arriving on Capitol Hill in a Ford EscapeHybrid, which certainly will put more symbolic faith in American carsas the Big Three's decision to previously arrive in Washington viaprivate jets did not convince anyone shopping at Chrysler Chicagoof their plight. But plenty of people did wonder why they were unableto use this opportunity to promote the value of their own vehicles.After all, the Escape hybrid has appealed to Ford Tacoma customers for its versatility and class-leading fuel efficiency. Thereduction of the Big Threes brands and vehicle lineups has alreadybeen underway. Perhaps the latest news is from Ford who announced itwas considering the sale of Volvo,its last remaining European luxury brand, which has also seendiminishing sales. But Ford isnt the only one. General Motors hasalready been trying to sell the Hummer brand, while Saab, Saturn, andPontiac all have the potential to be sold or eliminated as well.However, with so many brands, customers at a Ford Dealership in St. Louis expect that something will have to give at GM soon.Cutting a brand isnt a simple task says Lincoln Mercury Los Angeles,despite the need for it. Due to state franchise laws, an automaker suchas GM will need to buy out the dealers that offer that brand. GM spentabout $1 billion doing this when it decided to scrap the Oldsmobile brand.Butthese days the automakers are already bleeding cash, and dont havetons of it on hand to be buying out dealers of dissolved brands. A Spokane used cars dealer suggests that this makes a federal bailout absolutely vital to GM and the Big Three.The Big Three are not the only ones hurting. Chevrolet Tuscaloosadealers warns that dealers are also suffering from slowing car salesand the credit crunch. As a result, the Big Threes dealer networks areshrinking as many dealers are closing their doors for good.Forecasts remain fairly dim in the short-term as auto sales are not expected to rebound. Even Used Cars Kansas Citydealers believe that until credit is readily available, it seems alldealers in the US market will continue to fight an uphill battle. Butuntil the domestic automakers provide the changes that the industrydesperately needs, it will be the domestic dealers that will especiallybe hurting.
Brands,Are,Expected,Change,Det