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Many car experts see the beginning of a dramatic turnaround at GM. The company's products have features to boast about: multivalve engines, antilock braking systems, traction control, all-wheel drive and other new technologies. GM's new electronic transmissions have won rave reviews from the automotive press. "Let me put it into perspective," says auto consultant James Harbour, whose landmark 1980 study first shed light on Japan's manufacturing advantages. "General Motors is about to kick butt from one end of this country to the other. They're renewing products faster, they're continually reducing the cost of renewing those products, and you're starting to see a real distinctiveness between cars."
Consumers may be starting to notice too. GM's long, steady slide in market share bottomed out at a dismal 32% last October and has climbed back to 36%, even in a soft market. While Ford's sales are off 9% so far this year and Chrysler's are down 17%, GM is running only 5% behind last year's pace. But all of the Big Three have been outraced by the proliferating Japanese-owned plants in the U.S., which have increased sales 41.3% so far this year, selling 840,000 cars by mid-October. Overall Japanese market share in the U.S. has grown only about 1 1/2 percentage points this year, however, because most of the new Japanese production in the U.S. has been offset by reduced imports.
GM's extensive retooling, a drain in the 1980s, will be a boon in the 1990s by enabling the company to shorten its cycle of product development. Between last year and 1994, virtually every car and truck in its product line will have been redesigned, a claim that no other car company can make. In 1990-91 alone, GM will be introducing more new cars than Ford, Chrysler, Honda and Toyota combined. The 1992 model year will see redesigns of the Buick LeSabre, Pontiac Bonneville, Oldsmobile 88, Cadillac Eldorado and Seville, and Chevy's Beretta and Corsica lines, among others.
Most daunting of all for GM's competitors, the company has decided to fight for a bigger piece of the market. "GM is the pivotal company in this country," says analyst Keller. "By not defending market share, it allowed Chrysler to survive and allowed Ford to become this competitive monster. But here's something to think about: What if GM actually decided to defend its market share? I think that's going to be the major change." GM's Reuss confirms it: "At the top of our list is to profitably increase market share. You didn't see that five years ago." Saturn, in particular, throws down a challenge to GM's rivals. Ford hopes to fight back with the new Escort, designed by Mazda and built in Wayne, Mich. Chrysler is lagging behind, with a replacement for its Omni and Horizon cars due in two years.