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Fri, May 30, 2003 - Page 12 News List

General Motors to lure new customers by pushing quality

AP , DETROIT

General Motors Corp is using an unconventional approach to boost North American sales, acknowledging in new advertisements quality blunders to underscore progress it has made in recent years.

The world's largest automaker said Wednesday it will begin a long-term advertising campaign next week aimed at consumers who shy away from GM vehicles because of concerns about quality.

The initial installment, called "The Road to Redemption," will run in national and regional newspapers and magazines.

GM declined to say how much it was spending on the campaign, which over time will shift from quality to improvements in technology, the environment and design.

"We need to communicate to consumers ... in a voice that's very different from what they expect," said Gary Cowger, president of GM North America. "It's a unique effort to reach those consumers whose perceptions of GM are out of step with today's reality."

In J.D. Power and Associates' 2003 initial quality study released this month, GM fared best among the domestic automakers, recording an average of 134 problems per every 100 vehicles -- one more than the industry average.

Toyota Motor Corp repeated as the automaker with the highest overall initial quality, recording an average of 115 problems per 100 vehicles, but the domestic brands continued to gain ground in the closely watched study.

Toyota's Lexus brand was tops among all nameplates with 76 problems per 100 vehicles -- 27 fewer than No. 2 Cadillac, a GM brand.

GM has narrowed the gap between it and the industry leader in the J.D. Power survey by 58 percent in the past four years.

"We may not have done everything right in the past, but we've learned from it," Cowger said.

Art Spinella, an analyst with Oregon-based CNW Marketing Research, said GM's tactic was unusual in that shortcomings are not something auto companies either easily or readily admit.

Because GM already is making progress with consumers on the quality front, Spinella said he questioned how effective the ads would be, though he's yet to see them.

He said the message might have as much impact internally as it does externally.

"If consumers get anything out of it, that's fine," he said.

"But basically this seems to be a conversation with dealers and their staffs and with GM's own employees as much as it is with consumers. It's sort of cathartic," Spinella said.

GM, like other automakers, has battled sluggish sales since the start of the year because of lagging consumer confidence and concerns about the US-led war against Iraq.

Some analysts had predicted strong sales this month because of heavy incentives from nearly every automaker, but observers now are saying volume likely will come in below expectations.

Automakers report May sales Tuesday.

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