Wednesday, July 19, 2006

Chevy's high noon

Thursday, July 13, 2006
Chevy's high noon
GM tries to build buzz for upcoming Silverado
Brett Clanton / The Detroit News

PITTSBURGH -- In a tightly guarded ballroom at a Sheraton hotel, a small group of General Motors Corp. officials stiffen as they learn the guests of honor are about to arrive.

Everything has to be perfect, since almost no one outside the company has seen the redesigned Chevrolet Silverado pickup before this moment.

The door opens. The room goes silent. And in walks not a team of auto experts in power suits, but Big & Rich, the chart-topping country music duo.

"Whoa, that's awesome!," says band co-founder John Rich from under a black cowboy hat as he strides toward the gleaming blue pickup.

Smiling, he slips behind the wheel, turns the ignition and revs the engine.

"I'm gonna need one of these tomorrow," he says.

Chevrolet used its sponsorship of Major League Baseball's All-Star Game this week in Pittsburgh -- and the dozens of celebrities it attracted -- to quietly begin building buzz for the 2007 Silverado ahead of its launch this fall.

That's because GM needs and expects the next-generation Silverado to play a key role in its turnaround after the company lost $10.6 billion last year.

The current Silverado is not only the second-best seller of any car or truck in the nation and GM's top-selling vehicle line, it is a major profit center for the world's largest automaker.

But the 2007 model comes to market just as high gas prices and other economic headwinds are pushing some consumers away from the lucrative full-size truck category.

GM will have to fight harder to keep its place in the category, as other Detroit automakers try to protect their turf amid weakening sales and Japanese rivals aim to make deeper inroads.

This week, GM put the new Silverado in front of a handful of celebrity "influencers," ranging from professional athletes to musicians, in hopes of spurring a word-of-mouth campaign in the right circles.

In addition to Big & Rich -- known for the hit "Save a Horse (Ride a Cowboy)" -- ESPN baseball commentators Harold Reynolds and John Kruk got a turn at the wheel, and baseball legend Cal Ripken Jr. was scheduled for a private viewing.

This is only a tiny first step in what GM is planning for the launch of perhaps its most important vehicle this decade.

Right now, hundreds of GM employees and marketers from outside firms are painstakingly poring over a top-secret marketing plan for the new Silverado that will stress how far the truck has come since its last redesign in 1999.

Broadly, that plan will aim to keep loyal buyers in the fold and woo potential customers with a list of bragging rights, including big improvements in fuel economy over the outgoing truck, new class-leading safety features and a more refined interior.

The pressure to make sure the massive campaign hits all the right notes is keenly felt by those working on the plan.

"You better get it right," said Kurt Kruger, director of the Chevy account for Accentmarketing, a Miami-based firm that GM has hired to target Hispanic customers with Silverado ads. "Because if you don't get it right the first time, you don't get a second chance."

Chevy called its top 150 dealers to Pittsburgh on Monday and Tuesday to begin laying the groundwork for the Silverado launch, and to show them the vehicle for the first time. Tickets to the All-Star Game, which the dealers enjoyed from an Outback Steakhouse perched in left field at PNC Park, also helped lure the group to Steel City.

Yet the real test for GM will come later this year, when the truck finally lands in showrooms after years of preparation.

"No question about it," said Joseph Barker, industry analyst for CSM Worldwide in Northville. "This is a monster launch for General Motors."

While analysts say the 2007 Silverado is superior to its predecessor, GM still faces some challenges.

Gas prices near $3 per gallon and rising interest rates have weakened pickup sales recently, fat rebates are cutting into profits and Japan's Nissan Motor Co. and Toyota Motor Corp. are gunning for a bigger place in the category.

Few predict that the U.S. full-size pickup market -- which accounts for about 2.5 million of the 17 million vehicles sold annually -- will grow much beyond where it is today.

Even so, GM aims to boost sales and gain market share in the category with the new Silverado and GMC Sierra, a full-size pickup on the same GMT-900 underbody that arrives this fall. GM also wants to sell more richly-appointed trucks that yield a higher profit margin.

GM executives are confident that the new Silverado has the goods to do what the previous model did for its full-size truck business.

The outgoing Silverado/Sierra combo helped GM surpass Ford Motor Co. as the nation's biggest full-size truck seller, with the pair of trucks capturing more than half of the segment's 300,000 added sales since 1999.

"We have no intention of giving that up," said Gary White, a GM vice president and line executive over full-size SUVs and pickups, sitting in the passenger seat of the new Silverado on Tuesday.

Employee-pricing promotions last summer helped lead the Silverado to its best sales year since 1978 and to a record annual performance for the Sierra. Through June of this year, however, Silverado sales are down 12 percent and Sierra sales are down 19 percent, according to Autodata Corp.

GM invited The Detroit News for an exclusive first look at the 2007 Silverado, but would not allow specific details of the truck to be printed until after an unveiling to the media early next month at its Milford Proving Grounds.

But an unauthorized spy photograph of the truck has been circulating since June. That picture was taken in Colorado when a GM contractor made the mistake of hauling the new truck to a public car wash after a private publicity photo shoot.

The photo shows a truck with a wider track than the previous model, flared fenders and a more aerodynamic front end. But dealers who saw the truck for the first time Tuesday said the photo didn't do the truck justice.

"It's just unbelievable," said Bill Estes, a Chevrolet dealer from Indianapolis, Ind., who attended the closed-door meeting, which barred dealers from carrying cell phones for fear of another photo leak. "It's going to give us such an edge over our competitors," he said. "Ford is not even an issue anymore."

GM mainly used meetings in Pittsburgh this week to pump up dealers of its biggest-selling brand as they head into the second half of the year. And it was no secret that Chevy was in town.

As a sponsor of Major League Baseball, Chevy took every opportunity to put its cars, logos and advertisements all over Pittsburgh.

In the Allegheny River, there were huge inflatable baseballs painted with Chevy bowties. On the streets downtown, there were 100 Chevy vehicles promoting GM's "flex-fuel" technology that allows vehicles to run on either gas or an ethanol blend. On Tuesday afternoon, there was a parade for baseball stars who rode in Chevy cars and trucks.

The All-Star Game promotions come just days after Chevy revived a popular advertising campaign from the 1970s that recalls a long-standing relationship with professional baseball. The new national campaign borrows from the old musical theme, "Baseball, Hot Dogs, Apple Pie and Chevrolet" but updates it for the times.

The new Silverado, however, won't begin showing up in ads for a few more months. The rest of Chevy's dealers won't even see the truck until September, when they gather in Las Vegas for an annual meeting.

GM pulled ahead the launch of the new Silverado by 13 weeks to aid its North American turnaround efforts. The move had the unintended effect of letting GM get to market with a new pickup faster than Toyota, whose new San Antonio-built Tundra arrives early next year.

Though it is starting small, Toyota is expected to become a bigger player in full-size trucks in coming years But the Japanese juggernaut may have a hard time attracting highly loyal domestic truck buyers, no matter how good the product.

That's just the kind of thing Fort Worth, Texas-based Chevy dealer Chip Jones wants to hear. Cars are one thing, but Jones said he can't envision a day when Toyota becomes the truck leader in the Lone Star State.

"Trust me," he said. "They'll never let that happen in Texas."

You can reach Brett Clanton at (313) 222-2612 or

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