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Interview With Car and Driver's Csaba Csere

Aired May 29, 2003 - 14:49   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


MILES O'BRIEN, CNN ANCHOR: General Motors is confessing its sins, promising to do better, and looking for redemption. In a very unusual ad campaign called "The Road to Redemption," the car manufacturer admits some of its past models were clunkers. Of course, we all knew that.
Its humble message is aimed at buyers of new GM products, and promises they are ready to make amends.

Let's find out more now from CNN's Alan Chernoff to see if people are ready to buy that Buick.

ALAN CHERNOFF, CNN FINANCIAL NEWS: Miles, you might call this mia culpa advertising. Next week, the nation's biggest automaker will begin a print ad campaign that does confess to quality problems in the past. The headline of the ad says, "The longest road in the world is the road to redemption," and the subheading says, "30 years ago, GM quality was the best in the world. Twenty years ago it wasn't. The story of our long journey back."

In the fine print, GM argues, "Today we're building the best cars and trucks in our history."

The company is targeting the estimated 40 percent of U.S. vehicle shoppers who don't even consider GM models. Executives want them to rethink their impression of GM.

(BEGIN VIDEO CLIP)

GARY COWGER, PRESIDENT, GM NORTH AMERICA: This is something where you're looking to build up equity with people over a longer period of time, and I think, Why are we able to do this now? It is because of the solid improvements that we've made.

(END VIDEO CLIP)

CHERNOFF: Independent surveys show that GM quality, in fact, has improved over the years. In fact, in a press release, GM says it was the top performing domestic manufacturer in the latest J.D. Power and Associates Initial Quality Study.

But what GM does not say is that its score on the study was actually below the industry average: 134 problems per 100 vehicles compared to the industry average of 133. J.D. Power surveys more than 50,000 car and truck buyers 90 days after their purchase, and the company does a separate survey on long-term dependability. And there too, GM also performed below average in the latest study. So, Miles, it appears that perhaps GM has a little further to travel on this quality road to redemption.

O'BRIEN: Interesting story. Alan Chernoff in New York, appreciate it.

Here to talk about the redemption campaign is Csaba Csere. He is editor in chief of "Car and Driver" magazine. Csaba, good to have you with us. Are you there?

CSABA CSERE, EDITOR IN CHIEF, "CAR AND DRIVER": I'm here.

O'BRIEN: OK. Good. We couldn't put you up there for a second. Quality issues, I guess, quality control.

But we are on the path to redemption.

This is a remarkable campaign. Give us a sense of what's going on inside the halls of General Motors there in Detroit -- and I would just love to be the guy who first pitched this idea at those high- level meetings. They probably sent him out of the room and told him to get a job at Ford.

CSERE: Well, it is amazing that actually telling the truth in an ad would seem so controversial, but that is really what these guys are doing. They are acknowledging what went on, and 20 years ago, their quality was genuinely very poor. Right now, it's basically right in the middle of the pack and improving, and has been improving over the past several years. What GM wants to do is, they want to take those buyers that they lost over the last 20 years and get them to take another look at GM products, and I think a little bit of candor gives this ad some credibility.

O'BRIEN: All right. It's probably a little more than candor, though. What they're essentially admitting is that 20 years ago we were lying to you and telling you we had great cars. When you admit that you've told a lie, you lose some credibility with consumers, don't you?

CSERE: Well, I don't know that they were lying 20 years ago. Twenty years ago, they were doing the best they could. They were putting their best foot forward in their advertising, just as every company does all the time, and every product isn't the best. Nobody is always going to be the best in any particular field, and 20 years ago, they definitely were far from the best. Now they're competitive.

I don't think consumers are going to take this that way. I think consumers are going to say, Hey, they guys finally get it, because they're admitting what we knew all along.

O'BRIEN: All right, but does the advertising campaign match the reality? Are these cars that you're seeing today and test driving right now, are they really that much better than they were?

CSERE: Well, they are a lot better than they were. They're not necessarily the best in every segment, but right now they're also terrifically strong values. GM has a very level of incentives on these products. They're -- many of them are very, very good bargains. And the pure incentive advertising has not been working anymore to get people into the showrooms. So GM is taking a new tack to try and get people back into the showrooms.

And by the way, this ad coincides with their free (ph) overnight test drive program that's available on just about every car in the lineup. So if they can get you into a showroom, you can actually try out one of these cars and see for yourself.

O'BRIEN: Where did GM go astray? And when I ask that question, I guess it's a question, collectively, for the big three. How did they lose their way on this very basic and fundamental important issue of quality?

CSERE: Well, for a long time, the big three had a closed market. Up until the early '70s, they really had very little foreign competition, and no one was driving them to do better, and they gradually deteriorated. They were under union pressure to deliver higher wages, and no one was really making them do better cars.

But when we had the fuel crisis in the mid-'70s, then again in the early '80s, the imports, particularly the Japanese, made huge inroads into the market, and their quality was substantially better, and that's when they lost a lot of the customers, and it has just taken a long time to make up those differences.

O'BRIEN: Hard to change perceptions, isn't it, Csaba?

CSERE: Well, it's very hard to change perceptions, especially on a big ticket item like a car. This isn't like buying a $20 shirt where if it falls apart, you're only out 20 bucks. It is a serious investment. For most people, it's the second largest expenditure after a home that they ever make, and nobody really wants to take a risk on a bad car.

That's why, once you lose a customer to bad quality, it's very hard to win them back, and I think it's important for GM to be honest about what the reality was, and try and get these people back and give them a good deal to further lure them back, and also give them a chance to try the cars out.

O'BRIEN: Really quickly, Csaba, would you buy a U.S. car? GM car?

CSERE: I would certainly buy some of them. For me, it depends on whether it's the product that I want. But if it were a product that satisfied me, you bet I'd buy it.

O'BRIEN: All right. Csaba Csere, "Car and Driver" magazine. Thanks very much for being with us.

CSERE: My pleasure.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com






Aired May 29, 2003 - 14:49   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
MILES O'BRIEN, CNN ANCHOR: General Motors is confessing its sins, promising to do better, and looking for redemption. In a very unusual ad campaign called "The Road to Redemption," the car manufacturer admits some of its past models were clunkers. Of course, we all knew that.
Its humble message is aimed at buyers of new GM products, and promises they are ready to make amends.

Let's find out more now from CNN's Alan Chernoff to see if people are ready to buy that Buick.

ALAN CHERNOFF, CNN FINANCIAL NEWS: Miles, you might call this mia culpa advertising. Next week, the nation's biggest automaker will begin a print ad campaign that does confess to quality problems in the past. The headline of the ad says, "The longest road in the world is the road to redemption," and the subheading says, "30 years ago, GM quality was the best in the world. Twenty years ago it wasn't. The story of our long journey back."

In the fine print, GM argues, "Today we're building the best cars and trucks in our history."

The company is targeting the estimated 40 percent of U.S. vehicle shoppers who don't even consider GM models. Executives want them to rethink their impression of GM.

(BEGIN VIDEO CLIP)

GARY COWGER, PRESIDENT, GM NORTH AMERICA: This is something where you're looking to build up equity with people over a longer period of time, and I think, Why are we able to do this now? It is because of the solid improvements that we've made.

(END VIDEO CLIP)

CHERNOFF: Independent surveys show that GM quality, in fact, has improved over the years. In fact, in a press release, GM says it was the top performing domestic manufacturer in the latest J.D. Power and Associates Initial Quality Study.

But what GM does not say is that its score on the study was actually below the industry average: 134 problems per 100 vehicles compared to the industry average of 133. J.D. Power surveys more than 50,000 car and truck buyers 90 days after their purchase, and the company does a separate survey on long-term dependability. And there too, GM also performed below average in the latest study. So, Miles, it appears that perhaps GM has a little further to travel on this quality road to redemption.

O'BRIEN: Interesting story. Alan Chernoff in New York, appreciate it.

Here to talk about the redemption campaign is Csaba Csere. He is editor in chief of "Car and Driver" magazine. Csaba, good to have you with us. Are you there?

CSABA CSERE, EDITOR IN CHIEF, "CAR AND DRIVER": I'm here.

O'BRIEN: OK. Good. We couldn't put you up there for a second. Quality issues, I guess, quality control.

But we are on the path to redemption.

This is a remarkable campaign. Give us a sense of what's going on inside the halls of General Motors there in Detroit -- and I would just love to be the guy who first pitched this idea at those high- level meetings. They probably sent him out of the room and told him to get a job at Ford.

CSERE: Well, it is amazing that actually telling the truth in an ad would seem so controversial, but that is really what these guys are doing. They are acknowledging what went on, and 20 years ago, their quality was genuinely very poor. Right now, it's basically right in the middle of the pack and improving, and has been improving over the past several years. What GM wants to do is, they want to take those buyers that they lost over the last 20 years and get them to take another look at GM products, and I think a little bit of candor gives this ad some credibility.

O'BRIEN: All right. It's probably a little more than candor, though. What they're essentially admitting is that 20 years ago we were lying to you and telling you we had great cars. When you admit that you've told a lie, you lose some credibility with consumers, don't you?

CSERE: Well, I don't know that they were lying 20 years ago. Twenty years ago, they were doing the best they could. They were putting their best foot forward in their advertising, just as every company does all the time, and every product isn't the best. Nobody is always going to be the best in any particular field, and 20 years ago, they definitely were far from the best. Now they're competitive.

I don't think consumers are going to take this that way. I think consumers are going to say, Hey, they guys finally get it, because they're admitting what we knew all along.

O'BRIEN: All right, but does the advertising campaign match the reality? Are these cars that you're seeing today and test driving right now, are they really that much better than they were?

CSERE: Well, they are a lot better than they were. They're not necessarily the best in every segment, but right now they're also terrifically strong values. GM has a very level of incentives on these products. They're -- many of them are very, very good bargains. And the pure incentive advertising has not been working anymore to get people into the showrooms. So GM is taking a new tack to try and get people back into the showrooms.

And by the way, this ad coincides with their free (ph) overnight test drive program that's available on just about every car in the lineup. So if they can get you into a showroom, you can actually try out one of these cars and see for yourself.

O'BRIEN: Where did GM go astray? And when I ask that question, I guess it's a question, collectively, for the big three. How did they lose their way on this very basic and fundamental important issue of quality?

CSERE: Well, for a long time, the big three had a closed market. Up until the early '70s, they really had very little foreign competition, and no one was driving them to do better, and they gradually deteriorated. They were under union pressure to deliver higher wages, and no one was really making them do better cars.

But when we had the fuel crisis in the mid-'70s, then again in the early '80s, the imports, particularly the Japanese, made huge inroads into the market, and their quality was substantially better, and that's when they lost a lot of the customers, and it has just taken a long time to make up those differences.

O'BRIEN: Hard to change perceptions, isn't it, Csaba?

CSERE: Well, it's very hard to change perceptions, especially on a big ticket item like a car. This isn't like buying a $20 shirt where if it falls apart, you're only out 20 bucks. It is a serious investment. For most people, it's the second largest expenditure after a home that they ever make, and nobody really wants to take a risk on a bad car.

That's why, once you lose a customer to bad quality, it's very hard to win them back, and I think it's important for GM to be honest about what the reality was, and try and get these people back and give them a good deal to further lure them back, and also give them a chance to try the cars out.

O'BRIEN: Really quickly, Csaba, would you buy a U.S. car? GM car?

CSERE: I would certainly buy some of them. For me, it depends on whether it's the product that I want. But if it were a product that satisfied me, you bet I'd buy it.

O'BRIEN: All right. Csaba Csere, "Car and Driver" magazine. Thanks very much for being with us.

CSERE: My pleasure.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com