No. 1000
June 12, 2019
 

About The Autoextremist

Peter M. DeLorenzo has been immersed in all things automotive since childhood. Privileged to be an up-close-and-personal witness to the glory days of the U.S. auto industry, DeLorenzo combines that historical legacy with his own 22-year career in automotive marketing and advertising to bring unmatched industry perspectives to the Internet with Autoextremist.com, which was founded on June 1, 1999. DeLorenzo is known for his incendiary commentaries and laser-accurate analysis of the automobile business, as well as racing and the business of motorsports. Author. Commentator. Influencer. The Consigliere. Minister of the High-Octane Truth. DeLorenzo is considered to be one of the most influential voices commenting on the business today.

DeLorenzo's latest book is Witch Hunt (Octane Press  witchhuntbook.com). It is available on Amazon in both hardcover and Kindle formats, as well as on iBookstore. DeLorenzo is also the author of The United States of Toyota.

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Sunday
May192019

THUNDERHEADS.

By Peter M. DeLorenzo

Detroit. For all of the creative thinking and instances of intermittent brilliance demonstrated by its talented True Believers, this business is plagued by an oppressive layer of rote thinking and lemminglike behavior that is beyond frustrating and that has routinely wreaked havoc on the proceedings over the decades.

Why, you might ask? Auto companies are obsessed with other auto companies when it comes to product and marketing and just about every other aspect of the business. Part of the reason is that this business is an inveterate gossipy sewing circle that ebbs and flows with the prevailing winds. Model intros, press events and auto shows are chock-full of news that flows through the media and out to the wider audience, which is, first and foremost, made up of the other auto executives and their minions who have an insatiable need for any and all information about their competitors. Throw in the fact that the suppliers are a hotbed of hearsay, and you have a kaleidoscope of rumors, conjecture, hard but inevitably garbled facts, advanced intel that is shockingly accurate (but gets lost in the fact that there’s a thread of disbelief associated with it), and everything else you can imagine swirling around at a furious pace. And thus, it was ever so.

The result of all of this is that eerie and just plain weird occurrences happen all the time. You see it most in design trends that appear and become the look of the moment spread across a wide spectrum of the business overnight. How does this happen, exactly? Especially when designs are created with crushing lead times in top secrecy? One reason is that young design talent is being trained with a new level of discipline and professionalism in this business, which is commendable. But there’s a sameness that develops in that indoctrination too. Similar perspectives, similar training and similar points of view rear their heads eventually. The other reason is that everybody talks in this business, especially designers who get together to shoot the breeze. It’s no wonder that trends and design “signatures” you see in the models developed and offered not only seem so similar, but they somehow arrive at the same time. 

It doesn’t end there. Engineering and technical features are another hotbed of a kind of, “if Belchfire Motors is going with it, we’re not going to be left behind” type of behavior. Suppliers play a huge role in this, too, tipping off each other and their competitors alike about the latest gimmicks and come-ons that are on the way. And certainly, the explosion in AV and BEV research and development and the massive spend on new technologies has yielded, not surprisingly, similar pursuits – and results – with only subtle nuances to distinguish them from each other.

And then, of course, marketing isn’t left behind in all of this either. The strategic lingo used, the tone of the advertising, the executions, the national sales event advertising, the eerie similarities are all there right out in the open. And behind the scenes, trend words and industry jargon spread like wildfire because, after all, if you’re not on top of the latest marketing speak, you’re basically nowhere, which is a fate worse than death in this business, especially in the marketing arena. No other pursuit parses consumer information down to the last minutiae more than the auto business. The net result of all of this varies widely, because the genuine success of a marketing campaign ultimately hinges on hitting upon a compelling piece of creative, much to some marketing strategists’ chagrin. (After all, an accepted adage in this business – at least by clients – is that if a marketing campaign is a success, it’s because of the astute strategic thinking on the client’s part. If a campaign fails, however, it’s somehow always the ad agency’s fault.) 

You only have the look as far as the new TV commercial for the Chevrolet Silverado called “Tailgates” to see what I mean. It’s more compelling and memorable than any of the launch advertising that was initially created for the new Silverado, and I’d be willing to bet that the idea didn’t originate on the client side, either.

But the largest and certainly most demonstrable lemminglike behavior in this business is model proliferation. It’s loosely based on the philosophy that if a car company utilizes its vehicle architectures efficiently to create more models, then the profits will follow and everyone will look like a hero. Except that it doesn’t really work that way.

The most strident proponents of the model proliferation philosophy are the German luxury auto manufacturers. There’s no question that they’re the OGs of this movement. They exist in a world of their own making that revolves around the credo that if model proliferation is a good thing, then even more model proliferation is an even better thing. The explosion of models from Audi, BMW and Mercedes-Benz started to go off the rails about a decade ago, when they decided en masse to not only attack the SUV market while churning out even more variations of their coupes and sedans, but they then added performance variations to everything, whether they deserved it or not. All of this was fueled, of course, by the fact that the German luxury competitors have spent the better part of the last decade jumping at the slightest whiff of a rumor of a new product from one of their competitors to come up with an answer to that product of their own.

This is about the time we started seeing BMW doing homely “GT” versions of some of their sedans and countless versions of their “X” vehicles. And Mercedes and Audi launching product answers of their own that ended up stepping on each other within their own showrooms to a shocking degree. Do you even remember when BMW was just about the 3, 5, 7 and 8 Series? Or when Mercedes-Benz was about the C-, E- and S-Class? Or Audi was about the A4, A6 and A8? It barely registers on the memory meter now. (Just an FYI, right now BMW offers the following models: X1, X2, X3, X4, X5, X6, X7; 2, 3, 4, 5, 6, 7, 8, Z4, M Models, i3 and i8. And that doesn’t even begin to cover the variations of each of those models).

And now, after chasing niche after niche – both real and imagined – the German auto manufacturers have come up for air to realize that they just can’t do it anymore. In the last few months the buzz across this business has been about cutting the number of models offered while reducing complexity. Coming up with all of these niche vehicles is one thing, but supporting them properly with marketing, advertising and dealer training is quite another. It has added costs upon costs, and the whole thing is about to come undone because with all of these companies investing billions in BEVs and other advanced driving technologies, they simply can’t afford to do it anymore. And the aforementioned German manufacturers aren’t alone, either, because Toyota, Honda and VW have launched similar initiatives.

But this is much more than the manufacturers wanting to reduce their own, self-induced internal chaos. It’s about the fact that the confusion for consumers in vehicle showrooms – as well as prices – has been escalating to an untenable level. It’s nice to have options when car shopping, of course, but when variations upon variations are offered – with subtle model differentiations on top of subtle model differentiations added for barely discernible effect – it doesn’t add to consumer confidence by any stretch. In fact, it creates just the opposite, turning off people by making their decisions wildly complicated and needlessly difficult. 

To me the end of model proliferation for model proliferation’s sake is a very big deal. It has been such a part of this circus for so long that for the industry to now walk back from it is a measure of just how much the industry is in the throes of definitive change. 

We’re not talking about a few wispy clouds in the industry’s coffee these days. No, these churning, 70,000-foot thunderheads are ready to unleash their fury on this business for decades to come.

And that’s the High-Octane Truth for this week.

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