What's Good For Chevy Is Good For GM - Chevy Back in GM Management's Focus - Changes are a Comin'

FARMINGTON HILLS, Mich. December 18, 2003; Sharon Silke Carty writing for Dow Jones reported that General Motors Corp. is hoping to revitalize its Chevrolet brand by completely revamping its product line in the next 20 months, and by possibly dropping underperforming brands.

In a press briefing Thursday, GM's president of North American operations, Gary Cowger, said the auto maker's attempts to grab market share from its competitors depends largely upon the success of Chevy's new lineup. Chevy accounts for 56% of GM's sales, with offerings in the small-car market all the way up to commercial pickup trucks. "For GM to significantly grow, Chevy has to lead the way" Mr. Cowger said.

The company has set a goal of three million car and truck sales for its Chevy brand, although Mr. Cowger said he doesn't have a deadline for that sales goal. He noted that on an annualized basis, Chevy hit that goal three times in 2003. The auto industry reports monthly sales on an annualized basis, projecting what the total sales figure for the year would be if sales remained consistent each month.

An upcoming advertising campaign seems to tap on the nationalistic trend hitting the country, with a slogan of "Chevrolet - An American Revolution."

"We believe this passion is what's going to make Chevrolet great again," Mr. Cowger said.

Ed Welburn, GM's vice president of design, said the auto maker is attempting to recapture an emotional element with buyers. In the 1950s and 1960s, Chevy " had a very clear, strong identity; an assured presence."

"Then we lost it," said Mr. Welburn. "We didn't respond fast enough to a changing market. We lost that emotional connection."

W.W. Brent Dewar, general manager for the Chevrolet division, said the company is moving away from a one-size-fits-all mentality. In the past, the Chevy Cavalier was intended to satisfy two markets - lower-end small-car buyers and those wanting a higher-class small car.

"It's not credible to do that," Mr. Dewar said.

Now, Chevy is dropping the Cavalier and adding the pint-sized Chevy Aveo for lower-end customers and a more upclass brand, which will be revealed at the North American International Auto Show in January.

"If you're a foundational brand like us, you have to appeal to all markets," he said. "Within each segment you have to be relevant to the buyer."

Chevy is taking cues from Target Corp. stores, which focuses on producing stylish low-priced offerings. While Chevy doesn't intend to focus merely on the lower end of the market, it is taking pains to make sure its cars have stylish appeal.

"We call it 'Chevy Chic'," Mr. Dewar said.