GM/Renault?

christopherhJuly 3, 2006

The news today said that Jack Kekorian who owns a BOATLOAD of GM stock wants a partnership with Renault. Is the Daphne coming back to America? How about another Renault Alliance disguised as a Pontiac?

Just like the "old days" when we had AMC/RENAULT. Now maybe GMC/RENAULT?

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steve_o

Renault now is a very different company than the quirky manufacturer that brought the Dauphine to the U.S. and supplied a broke American Motors with some pretty boring cars (I always heard it called the "Renault Appliance").

Renault's partnership with Nissan has served both companies well, and GM certainly could learn something from both of those companies about offering cars and trucks people actually want to buy (one of GM's biggest problems right now). The news article I read was talking about a 20% share anyway, so I'm not sure how much influence Renault would have. But, if I were GM, I certainly would be listening.

    Bookmark   July 3, 2006 at 2:54PM
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christopherh

I remember the Dauphine. My neighbor had one. He's the one that called the Daphne.

Renault has some excellent engineering but they just cannot build a car that's reliable enough to please Americans.

They do build plenty of cars that routinely get 50 plus MPG though. Without batteries or fuel cells.

But Nissan's investors are worried that Nissan will be watered down and they are against the move.

    Bookmark   July 5, 2006 at 8:15AM
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steve_o

One of the reasons Renault hooked up with Nissan is that Nissan can bolt together a decent car/truck. Even the European market is too competitive now to put up with "quirky but unreliable".

I can see, though, how Nissan would be much less thrilled about this venture than either Renault or GM.

    Bookmark   July 5, 2006 at 3:28PM
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bill_h

wow 1st i`ve heard of this, john deere will be heading to the buick dealer to trade up to a new buicksan. hahahahahaha

    Bookmark   July 5, 2006 at 10:20PM
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earthworm

Lets all hope this does not end up as AMC/Renault did..
I do not relish the French position, their engineering is good, I guess, but their build quality was horrendous, at least it was back in the 60s and 70s, maybe it is better now - the Japanese competition must be scary.
Now ,I think we build a car that is an equal to any competition, but people do not perceive this.....
GM needs support from its CEOs and its unions, not from the French and the Japanese.
This has not fully happened - doubt if it ever will..

    Bookmark   July 8, 2006 at 1:49AM
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steve_o

Even the worst car you can buy in 2006 is better-built than the best car you could buy 20 years ago -- and likely is better than most of the cars built even 10 years ago. The French, like everyone else, have had to raise the bar. A modern Renault is no more of a gamble than 'most any other European or American brand. And you mentioned the VW Touran in another thread here; the Renault Espace is at least as popular in Europe.

GM needs support from its CEOs and its unions, not from the French and the Japanese.

GM needs a lot of help. They can now construct a vehicle that is of pretty good quality. But they have failed to balance well their interest in cutting costs with not making the cars look like they're cutting costs. Styling varies from excesses like the Aztek and the HUMMER to sharp-looking, desirable cars like the Solstice. They suffer from muddled branding (if Pontiac is the performance division, why don't they sell the Corvette? And why does GM need four versions of the Uplander?) And then there are the costs of adhering to UAW agreements which were made by a spendthrift GM back when they were making money. GM really can't fail to address any of these problems if they hope to grow and not merely remain on life support.

Both Renault and Nissan have gone through periods in which their cars were not selling well -- Renault's for being poorly-built and idiosyncratic, and Nissan's for being boring and not having the size or power expected of the vehicles they sold. Both companies have turned around, thanks largely to the efforts of Carlos Ghosn. GM certainly could learn a few things from what this man has proven he can do. If he can turn around GM, it shouldn't matter if he's from France or Japan or Pluto.

    Bookmark   July 8, 2006 at 7:27PM
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lee676

I dunno...

GM's recent history with "strategic parterships" hasn't exactly been glowing - their alliances with Subaru, Isuzu, and Fiat went nowhere and cost dearly. Buying out Daewoo's automotive operations has given us the wonderful Chevrolet Aveo.

Carlos Ghosn - probably the sharpest auto exec around nowadays - has been queried in the past about a GM post, and said he preferred to stay with Renault/Nissan. His Nissan turnaround plan actually turned the company around, something GM (and Ford's) frequent restructurings have failed to do. GM's problems run deep - they consistently seem to bring out the wrong car at the wrong time. Take the new Buick Lucerne, which tries to compete with the Lexus ES350 by being bigger and offering a V8 engine, just as sky-high gasoline prices are making 4-cylinder engines popular again. And Toyota's new 3.5L V6 outpowers GM's V8s, whilst offering better fuel economy. GM, meanwhile, is rolling out a revamped line of big SUVs, a market consumers are rapidly abandoning. The new roadsters from Pontiac and Saturn? Mazda got there 18 years ago and still does it better. GM also has way too many dealers for the number of vehicles they sell, too many brands (8 brands sold out of 6 dealerships, vs. 3 brands from 2 dealerships from Toyota). GM has really been thinning the Pontiac and Buick lines, with likely intent to ax one or both brands. They continuously blame their shrinking market share on everything except dull and uncompetitive cars.

I wonder if they even believe their own lies anymore. Take the largely-ignored Pontiac Montana SV6 minivan for example. It's being dropped next year, allegedly because a minivan doesn't fit the sporty image Pontiac wants to project. Really? Let's have a look over at DaimlerChrysler, where their Dodge division is chasing roughly the same customers - young, masculine, rugged types, wooing these alpha males with Ram pickups, Hemi Charger muscle cars, and the Lingerie Bowl. Does a minivan fit in with that image? Evidently, yes: the Dodge Caravan is the best selling minivan in the U.S., despite having to compete with a nearly identical Town & Country van sold at Chrysler/Jeep stores. Pontiac's problem with the Montana isn't because of image or marketing; it's because the van is woefully uncompetitive. The four GM minivans put together don't sell as well as either the Honda Odyssey or Toyota Sienna.

Personally, I think Lutz is the most overrated exec at a major car company - I'd ditch him before Wagoner, but they'll probably both need to go.

    Bookmark   July 9, 2006 at 11:30AM
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