Hummer? Good Riddance. Sort of. But Not Actually.

GM is going to get rid of the Hummer. Good riddance! Pretty much.

Here’s why BrandlandUSA thinks it isn’t such a bad idea for GM jettison the brand. Because General Motors spent millions on a crazy scheme to build up Hummer around the same time that it killed off Oldsmobile, a brand which in 2001 was selling over 233,000 cars a year! As Rowland Netherway said in the Waco Tribune:

The recent GM decision indicates that the company doesn’t have an automotive philosophy or plan for the future as much as it reacts to the reaction of consumers.

Perhaps that’s the way it should be except Toyota, Honda and a few other foreign competitors appear to build cars based on long-range plans.

Toyota first introduced its fuel-efficient Prius hybrid in 1997, the year before GM bought the Hummer brand from AM General. That didn’t seem to bother anyone at GM until fuel prices rose to the point that motorists began looking for vehicles more fuel-efficient than some GM models that got no more than 10 mpg in city driving.

Ouch!

In 2004, soon after General Motors put out the last, tinny Olds Alero, GM announced it would put another few billion more into Saturn, making them just up market from Chevrolet. Two years later, it would announce that it would end production of the first generation Hummer. (H2 and H3 would continue). With that admission was a BIG surprise—the original Hummer was only selling a few hundred cars a year!

The question begs. Why would GM kill a division that sold hundreds of thousands of cars a year, but be content to have a division that only sold a few thousand for all these years? It’s simple really. To GM, Oldsmobile drivers did not have value. They were not hip. They were not young. They were not edgy. They were not on steroids like Hummer. These consumers did not think that it was amusing to have a car named after a sexual act. And so those consumers, taken for granted, were driven to other brands for sensible people. Like Toyota.

Hummer was made under contract to GM by AM General, the company that developed the Humvee for the Pentagon. AM General, which was the last remnant of Willys Jeep, could do small production runs. GM should have sold a few thousand Humvees at GMC dealers, and leave it at that.

Olds is now hip

When a company kills off the brand entirely, it can, in history, proclaim that the market for the Olds disappeared, and say that it was responding to market forces, instead of the obvious, that the consumer was not buying the unfulfilled promises made by General Motors. But the last laugh is on the consumer, for only a year after the last Oldsmobiles were sold from Oldsmobile dealers, they began to be seen as hip by the sort of young street kids inspired by Pimp My Ride on MTV.

These are the sort of folks that GM thought would be amused by the Hummer. But they want a old Oldsmobile instead!

In the case of Hummer it is true that the market for the elephant disappeared. But there is a more painful admission in the case of the Hummer. The market was NEVER there for a mass market Hummer. In the case of Hummer, GM valued market research over facts. Market research said that there was a market for the Hummer. Reality said that GM was ACTUALLY selling over 200,000 Oldsmobiles a year.

Humvee still lives

And another reason BrandlandUSA isn’t sad. The Humvee, actually known as the (HMMWV, or High Mobility Multipurpose Wheeled Vehicle) will still remain in production for defense use by AM General. (GM also says it might sell the brand, though we wonder who would be interested, though there is certainly a small market for it.) AM General is one of the coolest companies around, a successor to Willys Jeep, and all those other brands. See a great history on company’s website at AM General.

3 Comments

  1. You’re a bit nuts and you clearly don’t understand all the market forces and reasons GM killed Olds. Olds was selling almost the same cars you could get through Chevrolet, Pontiac and Buick and they were arguably losing market share the fastest. They made a gamble on Hummer and lost. What they should have done was kill Buick and Olds and invest more in Saturn and a small car division like Toyota did with Scion.

    The Olds you see on PMR are typically the gas guzzling beasts from the 70’s and 80’s – not the rides they were rolling off the assembly line when they shuttered Olds.

    Other factors in the Olds decision , Hummers were rolling off the assembly line at a higher profit margin and many of the Olds cars were being sold into the rental car companies – something they easily replaced with other GM vehicles.

    GM is too easy to pick on, I’m amazed they are still in business.

  2. Nuts yes! I disagree about Buick and Olds over Saturn. They have poured billions into Saturn.
    Yes, GM is WAY too easy to pick on. If I didnt love them so much I wouldnt bother.

    I rather like Saturns, and have owned two wagons, including the original wagon. A nifty car. But an Olds was special.

    Certainly, the Toyota idea of starting up Scion is smart. But GM has great brands of its own.

    Yes, PMR has guzzlers. But a brand identity is all about history and the present day. What is hip to one generation is tacky to another.

    Part of what makes GM great is the variety of brands. And to me, there is a big difference between a family that would drive an Olds, and a family that would drive a Buick.

  3. I could think of 3 or 4 things that GM could do with Olds brand. (Prehaps I should get it the consulting game.) Hummer they should have limited it by place with an existing marques or dual headed dealers it like Buick-GMC. Hummer was a good brand as it was a patriotic brand like Jeep (and AM General was apart of Jeep predecessor). Both duplicated vehicle used by the military: HMMWV and GP.

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