Pontiac leans into the sporty in quest to define its market
When the revolutionary new P-car, a plastic-skinned 2-seater, bows in the fall of 1983, it will give the Pontiac division of General Motors further help in nailing down an image that has eluded it for years.
In fact, after more than a decade of floundering in an automotive ''no man's land,'' Pontiac now thinks it knows where in the marketplace it's trying to sell cars.
''In the 1970s we bounced around trying to decide whether we were a luxury car, a low-priced car, such as the Ventura, or what,'' says William E. Hoglund, general manager of Pontiac. ''We also made a couple stabs at putting GTO packages on Venturas'' - in other words, a sports car.
''The most successful car we had all through the 1970s was the Firebird.''
About a year ago the people at Pontiac began to correct this lack of direction, or identity, so that motorists would know what they could expect to find when they thought about buying a new car.
Would they go to Pontiac for a big luxury car? Could they expect to find a sports-car alternative? A family-type car? A youthful car? What?
This kind of indirection has plagued GM car divisions all up and down the line and is one of the reasons for the severe drop-off in Chevrolet sales and its once-firm position in the marketplace.
All the GM car divisions - even Cadillac - were sharing what everyone else had. No longer could a motorist get into the GM ownership club by starting out with a Chevrolet and then climb the ladder to a Pontiac, Oldsmobile, Buick, and ultimately - if he had the money - a Cadillac.
''It becomes very important for an organization to have a sense of marketing direction,'' Hoglund says.
The Pontiac division has decided to concentrate on what it calls the expressive, more sporty end of the market, but, he says, ''that doesn't mean we plan to abandon the family end of the market.'' The division has, however, dropped out of the big-car business.
It has decided that all future designs, seating, instrument panels, etc., will be done with more of a sporty flair.
The Pontiac version of the GM A-body car, for example, is far more European, or continental, in execution than the Chevrolet. In other words, the Pontiac 6000 has its own distinct feel, or atmosphere, as opposed to the Celebrity by Chevrolet. It sets the two cars apart. A potential car buyer either likes it or he doesn't.
In the P-car that's coming up, Pontiac will have a car all to itself and is now rebuilding its home assembly plant in Pontiac, Mich., to accommodate it. Hoglund says the design ''is revolutionary and includes a lot of exciting innovations. There isn't a car built like it anywhere in the world.
''The paint process, for example, is far different, and so is the whole construction of the car.''
As part of its plan to establish its own identity, the GM division is also revising the way it identifies its cars.
''We've had a little trouble getting the 6000 off the ground because we changed the name,'' Hoglund says. The division has been shifting to alphanumerics instead of names - the 6000 for the midsize A-body car as well as the J2000 for the J-car subcompact and T1000 for the Pontiac version of the Chevrolet Chevette - similar to what some of the European and Japanese car manufacturers have done so successfully.
''In the A-car,'' says Hoglund, ''we didn't have any name in that end of the market to put on the car.'' But the public is unfamiliar with the ''numbers game'' in domestic cars. Ultimately, he sees success.
In the future all the GM car divisions will increasingly try to identify their own niche in the marketplace instead of feeding off one another, as well as the outside domestic and import competition, as they do today. Chevrolet can be expected to return gradually to the lower-price, entry-level spot in the marketplace.
''The competition makes one very keen,'' Mr. Hoglund asserts.
Meanwhile, he says the biggest job facing the US auto industry is, in his words, to ''get the costs down.''
The auto executive tells of a divisional diemaking shop in which the costs were significantly higher than any other die shop in the Detroit area.
''We laid the numbers out to the union,'' he says, ''and then sat down and renegotiated the contract which was applicable to that die shop. We took out 25 percent of the cost.''
Further, ''we also had something like 27 or 28 job classifications,'' he notes. ''It's silly and very expensive.''
In a Pontiac engine plant, scrappage rates have dropped in some operations from 25 percent to less than one-half of 1 percent, Hoglund reports. Inventories have dropped up to 60 percent and labor efficiency is up around 25 percent. Inventory has fallen from $3 million to well under $1 million.
''A lot of it,'' Mr. Hoglund says, ''is just because we stopped producing junk and stopped having to buy more parts to produce junk.''
Engine-plant suppliers are also sharply reducing bad parts - from an average of 6 to 8 percent to well under 1 percent.
''We're only get 0.8 percent defects, which, in the foundry business, is absolutely unheard of,'' the automaker reports.
Looking ahead, he says that ''it's a lot more fun to go to work these days than it used to be.''