- The Washington Times - Thursday, May 20, 2004

A couple of weeks ago, a dark red Oldsmobile Alero rolled down the assembly line at a General Motors’ Lansing, Mich., Car Assembly plant, marking the end of America’s oldest — and the world’s second oldest — automotive brand.

Plant employees signed their names to the inside of the hood of the 35,229,218th Oldsmobile built since Ransom E. Olds established his company in 1897. The last Olds is on display at the nearby R.E. Olds Transportation Museum, in an exhibit called “Thanks for the Memories,” open to the public.

Oldsmobile, in fact, has a storied history, having produced some of the most historic nameplates — the Cutlass, the Eighty-Eight, the Toronado — and engines such as the Rocket V-8. It pioneered chrome-plated trim and front-wheel drive.

GM had announced in December 2000 that the Oldsmobile brand, which became part of GM in 1908, would be eliminated over the following few years. GM said that despite major investments, Oldsmobile remained unprofitable, and its sales continued to erode. Besides, GM executives said, Oldsmobile buyers could easily move to other GM brands, most likely Buick.

So what is happening to Oldsmobile buyers? They aren’t going to Buick, for sure. Nor are they going to other GM brands in any great numbers. In fact, they are going to imports, mostly Japanese.

J. D. Power and Associates, the California marketing firm that conducts quality surveys, analyzed where Oldsmobile buyers were going via its Power Information Network, which gathers information regarding real customer buy-trade transactions from dealers.

Turns out, Oldsmobile buyers are turning to Hyundai Motor America in significant and increasing percentages.

In terms of brands, they turned to Chevrolet first and then to Hyundai. Cadillac and Pontiac ranked fifth and eighth, respectively.

Yet, Olds buyers didn’t flock to GM brands in large enough numbers to boost GM in the corporate ranking.

Buick ranked dead last as an alternative for Oldsmobile owners.

GM was 14th among all manufacturers that Olds owners turned to. Right behind Hyundai, they went to Nissan, Honda, Toyota, Mazda, Mitsubishi, DaimlerChrysler, Subaru and Suzuki (GM owns a stake in both these last two), Volkswagen, BMW, Isuzu and Ford, respectively.

Someone who is not surprised is George Glassman, who owned an Oldsmobile dealership in the Detroit suburb of Southfield, Mich. GM spent untold billions on buying out dealers such as Mr. Glassman or reassigning some to other GM dealerships.

When GM’s decision to eliminate Oldsmobile was announced, Mr. Glassman predicted a defection from GM with the departure of Oldsmobile, in part, because brand loyalty is nonexistent, and value is the be-all and end-all.

He’s also not surprised Olds buyers didn’t go to Buick. “Buick is still perceived as appealing to an older crowd,” Mr. Glassman said.

“GM truly turned its back on hundreds of thousands of buyers who I think could have been loyal.”

In addition, with their Oldsmobile franchises gone, dealers such as Mr. Glassman had to find other brands to sell; they went to Subaru, Kia, and, in Mr. Glassman’s case, Hyundai. In other words, mostly GM competitors.

“Hyundai acquired a number of good, quality dealers who have become the best competitive force against GM. [GM] created the monster,” Mr. Glassman said.

“I was a determined GM dealer, now I’m a very determined Hyundai dealer.”

And his customers have not found it difficult to transition from Oldsmobile to Hyundai.

They’ll have even less hesitation to switch to Hyundai now. In the week that the last Oldsmobile was produced, the South Korean automaker skyrocketed from near the bottom to near the top of the J.D. Power and Associates’ quality charts.

Hyundai, in the J. D. Power Initial Quality Survey, which asks more than 51,000 Americans about quality problems they’ve experienced during the first three months of owning their new vehicle, surpassed American and European manufacturers and is settling in among the lofty ranks of Honda and Toyota.

Hyundai Motor America tied American Honda in problems — 102 problems per 100 vehicles — just below No. 1-ranked Toyota Motor Sales U.S.A., with 101 problems. (Last year, Hyundai was near the bottom with 143 problems.)

In terms of brands, Hyundai ranked seventh behind luxury makers Lexus, Cadillac, Jaguar and then Honda, Buick and Mercury, putting it also ahead of Toyota and Infiniti.

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