Chevy's Slow Going rEvolution

Update 07.26.04

Volkswagen announced declining profits and issued a profit warning in this Associated Press wire story. VW blamed everything but the obvious for slowing sales in North America and Europe. Namely, the German manufacturer needs to reposition the Jetta and the Golf.

Toyota's attempts to woo Generation Y buyers have missed the mark so far in this New York Times article. The second largest carmaker will drop the slow selling Celica and MR2. The Scion's first two vehicles, xA and xB, have inched off the sales line. The problem bedeviling the Scion also bit Honda with the Element.

End

When Toyota was designing its first Lexus vehicle, the engineers poured through junkyards across Europe, the United States and Japan. They looked at how cars aged. What pieces broke? What equipment fell apart? The results were in subtle but appreciated touches.

For example, fabric seam was across the seat. For the Lexus, engineers stretched the leather across the seat and stitched on the side. This meant the seat would last longer, and Lexus has been atop almost every customer satisfaction survey since its introduction. Toyota showed it was adept at understanding competitive intelligence.

As a side note, David Halberstam wrote an exhaustive, and illuminating account of the automobile industry called Reckoning. To understand how Japanese nameplates thrashed the American, look at how Nissan stayed with its market orientation strategy even when sales were terrible.

In this Wall Street Journal article, Chevrolet appears hopelessly stuck in its product orientation. The Cobalt lacks the buzz of the Scion, the angles of the Focus, the longevity of the Civic. In short, it is another piece of Chevy metal.

If I were running Chevy, I would pour through every junkyard looking at Jettas. I would listen to every Jetta owner. I would read every Jetta web site. Why? Because the Jetta is over priced, satisfaction as a measure of quality is dropping, and sales have slowed to an inch worm's pace. This is a great time for a rival to knock down Volkswagen while the German car builder struggles with its own self inflicted wounds.

If Chevy could out Jetta VW, then it would be the small car sales leader and not the Koreans or the Japanese. Of course, to accomplish that objective requires Chevy become a market oriented company and that barrier may prove too high.