New GM project targets U.S. cities

From the Detroit News

'Arlington' initiative calls for taking message to markets untainted by negative news coverage.

David Shepardson / Detroit News Washington Bureau

WASHINGTON -- General Motors Corp., hoping to overcome a flood of negative national news, has quietly launched an intensive marketing effort to tout its successes and build consumer awareness for its products in medium-sized markets around the country.

A team of about 50 people -- including a couple in each of 16 cities, including Sacramento, Calif., Columbus, Ohio, Austin, Texas, and Buffalo, N.Y. -- is running the multimillion-dollar "Arlington Project," named for the Washington, D.C., suburb where it will be based.

The effort includes direct marketing, attempts to secure more favorable news coverage and outreach efforts by dealers, suppliers and other company officials. The cities were selected because they are dominated by local media rather than national outlets that have hammered GM in recent months for its sales and financial losses.

"We need to be more confident and aggressive in getting our side of the story told. One side's been told quite a bit. We need to get our side out, but you know we have to have results to validate it," Mark LaNeve, GM's sales and marketing chief, said in an interview Wednesday. "All the Arlington Project is about is really getting out our side of the story on product, fuel economy."

A second effort -- dubbed the Detroit Project -- is aimed at touting the progress of GM's turnaround in the national media.

"We have a lot of good news stories to tell," GM chief spokesman Steve Harris said, calling it a grassroots effort to get better coverage.

According to an internal memo sent by Harris on Wednesday announcing a shake-up in GM's public relations department, Peg Holmes has been named senior strategist and will oversee the Arlington Project.

She will work with the McGinn Group, a communications consulting firm also based in Arlington.

Brian Akre has been named to head up the Detroit Project -- "which is responsible for communicating the success of the GM turnaround," the memo said.

In addition, GM is making a renewed push to boost sales in booming markets such as southeast Florida and southern California, where its market share has fallen to the low teens in some areas.

Nationwide, GM has captured 23.8 percent of the U.S. market in the first four months of 2006, compared to 25.4 percent during the same 2005 period.

The company has been using senior executives to promote GM's turnaround.

Chairman and CEO Rick Wagoner has been on national TV, including an appearance on the CBS' "Face the Nation" Sunday morning news program and "60 Minutes" newsmagazine, as well as in Time, Newsweek and other prominent media outlets.

"Rick's been out there quite a bit. The dealers think that Rick is an excellent spokesperson for the company. He doesn't like doing it. He likes to run the business. … It's important for him as the CEO to be out there," LaNeve said.

During the interview Wednesday with The Detroit News, LaNeve touched on a number of topics:

GM wants to build and "fast-track" the new Camaro -- a concept sports car that's received lots of positive press coverage. "Based on the reaction to it, it'd be a great product for us not only for volume but from an image standpoint," LaNeve said.

"A car like that done and priced right is a 100,000-unit vehicle." No final decision has been made on putting the Camaro into production.

LaNeve said the company is about 1 percentage point behind where it should be in market share this year. "I feel we can make up some of the ground," LaNeve said.

GM is committed to building more flexible-fuel vehicles -- 400,000 are planned this year -- which can run on E85 -- a fuel made of 85 percent ethanol -- and will continue to add new models. "We think we'll be over 50 percent by end of the decade," LaNeve said.

GM has no plans to do an "employee discount" style summer sale that boosted market share in 2005. "We're not planning on any big bang, GM-wide incentives. We are going to be aggressive. We are going to have summer sell down programs, but they'll be executed by division," he said. The amount of incentives "is going to be driven by the competition. We're not going to let them run away and hide from us."

Rising gas prices have significantly impacted SUV sales.

"If gas was $2 a gallon, we'd probably be doing 100,000 more" full-sized SUVs.

GM's Live Green Go Yellow Web site has received more than 5 million hits, helping the company combat the perception that it doesn't build enough fuel efficient vehicles.

"Everytime it gets written and it says, 'GM, which is dependent on gas-guzzling vehicles,' it reinforces the belief. We'd like to see some shifting in that."

You can reach David Shepardson at (202) 662-8735 or dshepardson@detnews.com