Oldsmobile was one of the most well-known and loved automobile brands in the United States. The company was established in 1897 and merged with General Motors (GM) in 1908 (“The end of the road,” 2004). However, in 2000, GM notified that it was no longer possible to produce Oldsmobile automobiles due to economic causes (Rothenburg, 2001). In fact, there was a large variety of reasons for the production halt, implying that it was no longer “profitable” for GM to continue or renovate the Oldsmobile line (VanHulle, 2014). One of the major causes was the established image of the vehicle and its connection to older populations. In other words, the brand was not attractive to younger generations, and this stigmatization negatively affected sales.
GM could potentially renovate the vehicle line to restore its popularity among various demographic groups. However, the company decided not to modify Oldsmobile due to two primary reasons. First, drastic changes to the automobile line would have potentially destroyed its identity, which was beloved by so many people in the United States (VanHulle, 2014). The second reason was even more critical – GM already had too many automobile brands (Rothenburg, 2001; VanHulle, 2014). As Mark Phelan noted, “Part of it was just simple math <…> GM had about 50% more brands than it needed” (VanHulle, 2014, para. 29). As a result, GM could potentially renovate the vehicle line to make it more relevant in comparison to import models, but it would have most likely led to financial losses. The company evaluated the pros and cons of halting production and decided to prioritize profits and minimize risks by ceasing the Oldsmobile line. Although it was a painful decision for millions of people who truly loved Oldsmobile, it was GM’s right as the business company to pursue profits.
References
Rothenburg, A. (2001). No more merry Oldsmobile. Ward’s Auto World, 37(3), pp. 86-91.
The end of the road for Oldsmobile. (2014). History. Web.
VanHulle, L. (2014). Oldsmobile’s gone 10 years, but all’s not forgotten. USA Today. Web.