BREAKING NEWS: Reason for GM Failure Discovered! - VIDEO ENHANCED

Recent New York Auto Show Video Pinpoints the Problem Behind GM's Malaise

By Marc J. Rauch Exec. Vice President/Co-Publisher

There's a lot of theories and opinions as to why General Motors, the world's biggest automaker fell into hard times. And I have to admit, that some of the diverse opinions have originated right here at The Auto Channel.

But earlier today, while editing some videos from the New York Auto Show now going on during Passover, I have uncovered the real reason: NUMBERS.

That's right, numbers. No, not numbers, as related to Deuteronomy or any other part of the Bible, even though it is Passover. I'm talking about plain old ordinary numbers... you know, like 1 through 10.

Alright, let me explain my discovery: I was watching and listening to GM spokeswoman Susan Docherty talk about the company's new business plans. She said "We've made it very clear, as we go forward in being a viable, strong, healthy company for the future, we're going to need to focus on four core brands; that's Chevrolet, Cadillac, GMC, and Buick." Ms. Docherty then goes on to talk about how this focusing on the four core brands will allow GM to dedicate themselves to the best possible development, engineering and marketing efforts, etc.

But immediately after Ms. Docherty finished her little presentation about the four core brands, the video revealed that GM will be continuing with FIVE brands, not four: Chevrolet, Cadillac, GMC, Buick, and here it comes...Pontiac.

So I went back and watched the video again (in fact, the video is included below so that you may double check my arithmetic). I watched and listened to Susan again, and counted on my fingers as she read off the names, and she definitely said "four core brands" and then enumerated them. Then I watched and listened to the announcer, and my old friend Alan Taylor, clearly enumerate not four, but five brands (of course, I disagree with Alan's milksopped assessment of Buick as a "good premium brand," but that's an issue to discuss another day).

Well, five brands is a lot more than four. Sure, it's only ONE more, but it is 25% more than four. 25% in business is a lot... it can easily make the difference between profit and loss.

But that's not all, because just one day before this presentation was given, General Motors announced plans to develop and bring to market (in conjunction with Segway) a new small vehicle called PUMA. So that's actually SIX brands (since PUMA is not, at the moment, aligned with any of the other GM brands). (SEE ALSO: GM/Segway Puma story)

Susan Docherty said, "...We've made it very clear...we're going to need to focus on four core brands..." But then GM has CLEARLY tells us that they are focusing on five (or sort of six) core brands.

So this illuminates two major skeletons in the GM's closet: They don't know how to count, and they can't discern one of the most basic tenets of marketing, What is a brand? I think, based on my own extensive 35+ years of experience in the business world, that either problem can result in severe effects to a company's bottom line. And when you combine the two problems, then you really are hurting your chances for success.

Now, I may be wrong, my arithmetic could be off, or maybe there is a sophisticated Lou Costello-Mr. Bacciagalupe banana-counting scheme* at work here that I'm not aware of. If so, please write to me at mjrauch@TheAutoChannel.com and let me know. The future of the American automotive industry is at stake here!

Click PLAY to watch the GM New York Auto Show video

*If you've never watched the Abbott and Costello television series from the 1950s you won't have any chance to understand this reference.