To listen to Stanley Penn, Pontiac's redesigned Grand Prix is doing just what General Motors Corp. had hoped.
"It has an entirely new look," said the president of Penn Pontiac as he showed off a bright red coupe in his Southeast Baltimore showroom.
"Our Grand Prix sales have doubled and we're selling to people who would be spending $10,000 more on a foreign car like the Acura, Lexus or Infiniti."
The Grand Prix, which appeared in showrooms across the country about a month ago, is one of the first of 14 completely redesigned cars and vans that GM will be introducing for the 1997 model year, as the world's largest automaker seeks to shed its long-standing reputation as the world's largest producer of outdated vehicles.
"This is the most new models we will have introduced since 1980," said Edward Lechtzin, a spokesman for GM in Detroit.
By this time next year, GM will have replaced a fourth of its lineup.
The offerings include three new minivans to replace the poor-selling, plastic-bodied, long-nosed "Dustbuster" vans.
The Malibu returns as a midsize sedan to replace the Corsica and Beretta.
Cadillac will have the Catera, a $30,000 baby Cad aimed at the import-minded baby boomer.
The midsize line is being redesigned for the first time in 14 years with a new Buick Century and Olds Cutlass replacing the aged Ciera.
For those in the fast lane, a redesigned Corvette bows in the first quarter of 1997.
It has a trunk and more horsepower, and the transmission will be shifted to the rear for better weight distribution.
There is even an electric car, a $35,000 two-seater that initially will be sold only at Saturn dealers in Arizona and California.
It doesn't end with the 1997 lineup.
GM will continue replacing old cars with new cars at a rate of about one a month through the end of the decade.
It's all part of a multibillion-dollar plan to halt the long decline of GM's share of the U.S. car and light truck market and to wipe away the haunting memories of its near bankruptcy earlier in the decade that robbed the company of the cash needed to develop fresh products.
There's a lot riding on the new vehicles.
"The management at GM is not betting the company on these cars," said David Healy, an auto analyst with Burnham Securities, "but on the other hand, it will be a huge problem for them if these cars don't fly any better than Ford's new Taurus did."
Healy said GM's new products will be more conservatively designed than the Taurus and there will be less risk of them turning off a segment of the car-buying public.
"This is an extremely important 12-month period for General Motors," said Maryann Keller of Furman Selz Inc., one of Wall Street's most influential auto industry analysts.
Noting that GM has lost 10 percent of its market share since the early 1980s, Keller said that all of the new models need to be successful if the automaker is going make a U-turn and and start recapturing market share.
GM now has about 31 percent of the auto market, down from about 50 percent in the 1960s, when it was such a dominant force that some lawmakers in Washington considered breaking up the company.
The influx of new models is "crucial also to General Motors' strategy of maintaining six car divisions," Keller said.
"You can't maintain six car divisions with 31 percent of the [domestic] car market."
Keller said the new models could be the savior of GM's struggling Oldsmobile division, which is expected to sell fewer than 350,000 cars this year.
The Olds division used to sell a million cars a year, she said.
L The managers at Olds are not the only ones who are sweating.
This is going to be a tense year for a lot of people at GM, said David E. Cole, director of the University of Michigan's Office for the Study of Automotive Transportation.
The pressure is on, he said.
"They are apprehensive, as anyone would be with such a large array of new products, but at the same time I think there is a level of confidence at GM that I haven't seen in a long, long time.
"They don't feel like they are shooting from the hip.
"They have done their homework and they think their lineup is right for the market," Cole said.
He added that GM's confidence has received a big boost in recent years by the success of three other redesigned cars -- the Lumina, Monte Carlo and Cavalier.
In 1994 GM redesigned the Lumina, which had been offered in four-door and coupe models. The Lumina name was retained for the four-door sedan, but the coupe took on the Monte Carlo name. Sales jumped 85 percent in calendar 1995 and are up another 18 percent this year.
The redesigned Cavalier was troubled by production problems during its first year, 1995, but sales still rose 14 percent. They are currently running 47 percent ahead of last year's sales pace.
"I think they [the top executives at GM] will be very surprised if the new models don't work well in the marketplace," Cole said.
GM's various divisions are doing more than bending metal into new shapes to pull out of their rut and grab a bigger slice of the auto market pie.
The new products are being backed by a new marketing thrust the company calls brand management, which is designed to end division rivalry and create strong identities for each of its cars, trucks and vans.
It's no space-age marketing concept, concedes Ronald L. Zarrella, a GM vice president and head of marketing and advertising for GM's North American operations.
It was a strategy outlined by former GM Chairman Alfred P. Sloan in 1927.
It involves building a complete line of vehicles from the low-priced group to the top of the market and aiming each at specific buyers.
In recent decades the lines have blurred as GM's various divisions came out with look-alike cars that confused potential .. buyers.
"In today's vehicle market, with more consumer choices, each product needs a distinct brand image based on the benefit it offers the customer," said John F. Smith Jr., chairman and chief executive of GM.
Brand management, said Cole, starts with listening to car buyers to determine what they want in a new product.
"They were basing their products more and more on competitive products rather than on the markets or what the customers wanted," Cole said.
"As a result they are getting further and further from the market."
Now, Zarrella said, "We're positioning every one of our vehicles against a set of target customers."
For example, Zarrella said, the "Grand Prix is known for performance and handling and we want it to own handling in its marketing segment."
The Malibu with its roomy interior and large trunk is positioned to be the functional family sedan for the price-conscious buyer.
The Oldsmobile Intrigue, which replaces the Cutlass Supreme, will be a stylish midsize sedan designed to lure upscale buyers away from the imports.
In addition to aiming cars for specific customers, GM will be spending hundreds of millions on advertising to define its products and where they fit in the market.
"They are taking a new approach to advertising," Cole said.
"You are going to be seeing more targeting advertising.
"It will be more of a rifle approach than the shotgun approach used in the past, when the company pumped a large percent of its advertising budget into network television spots."
Cole said GM may even spend less money on advertising while achieving better results.
"Advertising will be more focused," he said.
"If you're trying to sell a Buick, which appeals to a more mature audience, you won't advertise on MTV. But if it's a Pontiac that you're selling, that might be the best place to spend your advertising dollars."
GM is doing a better job of directing its advertising and building cars aimed at clusters of customers with similar needs now than in the past, according to Zarrella.
But, he said, there is still room for improvement. His aim is to have very little overlap between vehicle brands by the end of the decade.
If GM succeeds, it would be enough to make Sloan proud.
GM's new models
PRODUCT... ... ... ... ... .AVAILABILITY
.... .... ... Minivans... ... .... ... ....
Chevrolet Venture... ... ...4th qtr.... '96
Pontiac Trans Sport ... ... 4th qtr... '96
Olds. Silhouette ... ... .. 4th qtr... '96
.... .... Midsize passenger cars .... ....
Pontiac Grand Prix .. ... .. 3rd qtr....'96
Chevrolet Malibu .. ... ... 1st qtr....'97
Oldsmobile Cutlass ... ... . 1st qtr... '97
Olds. Intrigue... ... 2nd or 3rd qtr... '97
Buick Century... ... ... ... 1st qtr. ..'97
Buick Regal... ... .. 2nd or 3rd qtr... '97
.... .... ... Small car... ... ... ... ....
Saturn coupe ... ... ... ... 4th qtr... '96
.... .... ... Large car... ... ... ... ....
Buick Park Avenue ... ... .. 4th qtr... '96
.... .... ... Luxury car... ... ... .... ..
Cadillac Catera ... ... .... 4th qtr... '96
.... .... ... Sports car... ... ... ... ...
Corvette ... ... ... ... ... 1st qtr... '97
.... .... ... Electric car... ... ... ... .
EV1... ... ... ... ... ... . 4th qtr..'96 - Calif., Ariz.
Pub Date: 9/22/96