Corvette replay: Lutz v. Wagoner?
Over the weekend, there were new reports about future product plans at Cadillac and Corvette. Underlying them, though, are some intriguing questions about how the decisions are being made and who is making them.
And about Bob Lutz’ role?
According to a breathless web report by Motor Trend the C7 Corvette “originally planned for the 2011 model year... will likely launch as a 2012 model and may even slip further.” The magazine reports that there are three possible versions of a C7 currently under consideration: an evolution of the C6, a mid-engine Corvette, and a Kappa platform based Corvette sharing its platform with the Solstice.
Most intriguing, however, is MT’s assertion that Bob Lutz is backing away from a mid-engine Corvette. According to MT, Lutz originally backed the mid-engine design. But now, “[w]e hear Lutz is backing down from his support of a mid-engine C7, though other powerful GM execs reportedly still favor it.”
Meantime, over at thetruthaboutcars.com it is reported that Lutz was behind a new, small entry-level Cadillac, over opposition from Cadillac General Manager, Jim Taylor, and GM’s marketing vice president, Mark LaNeve. Lutz wins and an Alpha platform Cadillac is to be introduced in 2011, built at Lordstown, Ohio. According to the report, Lutz believes the smaller car will help establish the brand overseas.
So, who’s running the product show at GM?
The facts in the Motor Trend report are obviously stale. The product plans revealed by the GM contract with the UAW have been all over the web for the past week. The contract specifically pegs 2012 as the projected date for a new Corvette, built at Bowling Green, Kentucky. The contract also commits to a dual-clutch transmission for 2012 for that car. It commits to a new Cadillac XLR for 2012 at Bowling Green. Lastly, the contract moves the next generation Solstice to Bowling Green.
So, who’s on first at GM? Is it Lutz? Or somebody else?
There seems to be some significant product planning tension at General Motors. Some of that may be prompted by fear that new federal fuel economy mandates will be too steep for the car maker to meet. Part of it may be prompted by GM’s emphasis on expanding in developing markets. Cancellation of the domestic Zeta platform was laid at Lutz’s feet, ostensibly due to concern that it would be too expensive to produce. However, Lutz has also said that the company was deferring some product plans due to uncertainty over possible mileage standards. There is every reason to believe that GM’s management might be gun shy about new large vehicles: they’ve been badly burned by the downturn in the truck and SUV market just as they brought new models to market, models in which the company had heavily invested.
The answer is that it’s somebody else – or at least somebody else’s strategy.
That somebody else is Rick Wagoner, the CEO and boss.
Wagoner’s vision of GM is global.
“Overseas” no longer means Europe alone. Indeed, Europe may mean very little to GM’s concept of “overseas.” While, GM’s new contract with the UAW clearly shows that the company has committed to the domestic market, that market is really an international market, too. Foreign companies dominate the domestic automobile market. While GM has made some periodic foray’s into the European market with Cadillac, it has no real reason to try to establish American brands in Western Europe. It already owns Opel and Saab, both already established European brands.
If GM’s product decisions are viewed from a global perspective, a pattern begins to emerge. The products which fit GM’s conception of the global market are approved. Those that do not, are not approved.
So viewed, a smaller and less expensive Cadillac begins to make better sense. It is not a question of whether a small Cadillac dilutes the brand in the United States. It is a question of whether the brand can be established in new markets without that model. IF they can sell some of them in the U.S., too – all the better. As for concerns about diluting the nameplate’s image – well, that’s what GM pays guys like LaNeve to handle. He’s getting paid to give that small Cadillac an upscale image, not to avoid the challenge.
It is no accident that the upcoming ZR1 Corvette was nicknamed the “Blue Devil” by its planners, and that it became identified with that name. That was an overt play to appeal to Wagoner, whose alma mater is Duke Univeristy, the home of the “Blue Devils.” But, why? Lutz tried to kill the ZR1, but failed – ostensibly because the car was too far along in the planning process to cancel. On its face, that excuse makes no sense: the car is just a Z06 with a supercharged version of the same basic engine and some carbon fiber body parts. What’s to cancel? It is a fair guess that the people at Chevrolet knew from the outset that it was Wagoner they’d have to sell, not Lutz.
MT’s report that “powerful executives” at GM favor the mid engine C7 even as Lutz “backs away” sounds like a replay of the Blue Devil struggle. At GM, who has more power than Lutz?
Marques with international prestige are producing high performance cars that showcase technology. Audi jut introduced one. Nissan and Lexus -Benz have new models aimed at that market on the verge of introduction. Mercedes-Benz is developing a new competitor for that market in conjunction with AMG, its subsidiary.
Prestige counts for a lot in emerging markets. That’s why Ferrari has a dealer in Moscow and why Ferrari has boosted overall production by 1000 cars annually. You can bet that the architect of GM’s global strategy understands that.
A mid-engine Corvette fits GM’s global strategy.
Remember one other thing: Bob Lutz is 75 years old. It is unlikely he will still be the Vice-President of product planning in 2012.