The dictionary defines “White Elephant” as :
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a possession that is useless or troublesome, especially one that is expensive to maintain or difficult to dispose of.
The following 4 cars produced by GM certainly fit that definition and can be seen as the most important parts in the company’s implosion.
All 4 cars hailed from the 1980s. It was GM’s worst decade ever as far as market share is concerned. All but the first can be laid at the feet of CEO Roger Smith, a man who seemed to love doing everything the most expensive and risky way possible and effectively bankrupted the world’s largest company.
X-bodies
What was it?
To meet Corporate Average Fuel Economy regulations, GM sequentially downsized all its cars in the late 70s. In 1977, the full sized cars were shrunk, in 1978, the intermediates, now it was time for the compacts to be both shrunk and moved to front wheel drive.
What was wrong with it?
The x-bodies were supposed to be released in 1978 alongside the new midsized cars, but it was soon delayed. GM’s investors wanted a return on all the money that was being spent on this new fuel efficient lineup and GM’s dealers were sick of explaining to confused buyers why they should buy a “midsized” Malibu when the “compact” Nova was less expensive and roughly the same size. So the X-bodies, Chevrolet Citation, Pontiac Phoenix, Oldsmobile Omega, and Buick Skylark, were prematurely put on sale.
The new cars were an absolute nightmare in terms of reliability. They were recalled no less than 9 times by NHTSA, a record that has never been broken. Body arms came loose and damaged fuel and brake lines, steering racks detached, transmission hoses failed and caught fire, front springs came unseated, and worst of all, a faulty brake proportioning valve caused the rear wheels to prematurely lock up. The government sued and GM wound up winning the case in 1987, 2 years after the x-bodies were put out of their misery.
The X-bodies were also pretty lousy to drive. They would violently torque steer, the crude Iron Duke 4 cylinder engine was gutless and produced prodigious noise and vibration. To help fix this problem, the front subframe was attached to the body with very soft rubber mounts. This led to an odd sensation during acceleration as automotive writer Paul Niedermeyer explains:
It felt as if your favorite H-mobile was composed of two separate components (which it sort of was), or to take the analogy further, it felt like the body was a semi-trailer hooked to the back of a semi-truck. Floor it, and the truck started heading one direction (left, if I remember correctly) while the trailer both followed as well as tried to keep the truck from running off the roadway.
The awfulness was reflected in sales. The Chevy Citation was America’s best selling car in 1980 with 800,000 sold. This was down to barely 60,000 by 1985. I assume Honda dealers were swamped with X-body trade-ins during that period.
H and C Bodies
What was it?
GM decided to downsize their big cars again in 1985 and move them to Front Wheel Drive. The C-Bodies were the 3 pictured cars, while the H-Bodies were the Pontiac Bonneville, Olds 88, and Buick LeSabre. The Chevrolet Caprice and Cadillac Brougham stayed on the old B-Body platform.
What was wrong with it?
Smith’s reorganization of GM stripped away the autonomy of all the divisions. The result was widely criticized cookie-cutter styling, which Lincoln made all too clear in this 1986 commercial.
And the design the 4 divisions settled on wasn’t a particularly good one. The “shear” look was going out of style, and for whatever reason, earlier models used sealed beam headlights despite composite headlights being legalized.
There was another problem; GM chose to downsize based on the predictions of consultants who said gas was headed towards $3 per gallon ($6 in today’s money). They turned out to be extremely wrong. In 1986, gas prices fell to less than $1 per gallon. In a plot twist, it was GM’s small full sized cars that were now dinosaurs, relics of the energy crisis. Traditional luxury sedans like the Lincoln Town Car and GM’s own Cadillac Brougham set sales records in 1986.
You may say that hindsight is easy in retrospect, but the fact is that gas prices had been slowly declining for 5 years. This meant GM was planning for an energy crisis that nobody else saw coming.
The H/C bodies cost GM $3 billion to develop, about the same as Ford spent on the Taurus, but the reactions to both could not have been more different. It was money down the drain for GM.
W Bodies
What was it?
A new midsized platform that was not just a response to foreign marques like the Honda Accord and Toyota Camry, but also to the hot new Ford Taurus. There were 4 of them, each with different personalities. The Buick Regal was supposed to be a traditional American luxury car, the Olds Cutlass Supreme was aimed at European import buyers, the Pontiac Grand Prix was supposed to be a sports sedan, while the Chevy Lumina was the blue collar family car.
What was wrong with it?
The W-body project was probably the most incompetently managed and costly one of Roger Smith’s boondoggles, and that’s saying something.
The project dated back to 1983. The aim was for the W-body to take a whopping 21% of the US car market (today all of GM has just 17% of the US market) with 7 factories each building 250,000 cars. It was poorly executed from the beginning.
Robert Dorn, Pontiac’s chief engineer, was appointed the GM-10 coordinator–but what good is a head without a body? Dorn had no dedicated team, and no authority over any engineers. He worked out of Chevrolet’s engineering department, next to engineers over whom he had no power.
In total, the project cost a staggering $7 billion ($14 billion in today’s money). That’s twice what Ford spent on the much better Taurus. Buick, Olds, and Pontiac got the coupe versions of their W bodies on sale in 1988. In those 5 years, a lot had changed. GM went from 42% of the US market to just 35%, their lowest since the 1920s. And the market for midsized coupes was shrinking quickly (Taurus was 4 door only). It took until 1990 for Chevrolet to get its W-body, which offered the first sedan variant. It wasn’t until 1991 that all the W-body sedans arrived. The resulting cars were not very good. They couldn’t match the Honda Accord for quality or refinement and couldn’t match the Ford Taurus for handling. The Chevrolet Lumina sedan was 9 inches longer than the Ford Taurus, but no more spacious inside.
By 1990, GM was losing $2000 on every W-body it sold and in 1992 was on the brink of bankruptcy. It was at this point that it became clear GM’s decline was terminal.
Saturn
What was it?
This was the last of GM’s attempts at a miracle compact. This car, originally meant to be sold as a Chevrolet, was so new that it got its own division, its own new factory in Tennessee, new engines, and a whole new dealer network.
What was wrong with it?
GM was still delusionally convinced there was a silver bullet out there that could solve their problems. The Japanese knew that the key to excellence was continuous improvement that took years of effort, something that GM ironically understood and still understands with the Corvette.
Despite spending $5 billion on the Saturn, the resulting car was no Honda Civic. Its engine was noisy and its interior was cheap. GM’s executives told themselves that the better dealer experience with no-haggle pricing would put them above the Japanese. Honda and Toyota dealers were notoriously sleazy, so that wasn’t what brought customers in.
Saturn’s problems only got worse in its next 18 years of existence. By the time the plug was pulled in 2009, it had become a full lineup of SUVs, a midsized family sedan, and even a roadster. If the Saturn had been sold as a Chevrolet, this sort of mission creep would’ve been avoided. Instead, they wound up with a gaping money pit.
Conclusion
Much has been written about GM’s implosion, but as these 4 costly debacles illustrate, much can be blamed on their costly search for “the next big thing”. They lost all their money on get-rich-quick-schemes. And consider where all the wasted money could’ve gone. It could’ve meant improved quality and reductions in NVH (noise vibration and harshness). Things that would’ve made them more competitive against the Japanese. But they didn’t, and they paid the price.