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A lesson in Product Diversification

I am truly baffled that the industry that created a lot of great MBA course studies missed out on this one big time.  GM, Chrysler and Ford failed to cover their market segments.   And they capitalized on a trend for short-term gain, forgetting that a trend is just that, a trend that will not last.

I am talking about SUVs and large cars that are simply fuel inefficient.  They are beautiful and luxurious alright, but the market for these couldn’t last.  Now, you have wonderful SUVs and hummers and large cars just sitting on display windows, heavily discounted and with coupons for free or discounted gas pump purchases.

But the market is not interested.  What went wrong?  They forget to cover the low end of the market – those that needed fuel efficient compacts and small SUVs that, unfortunately for them, are now owned by Japanese and Korean brands.

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