Monday, May 10, 2010

Ed “P.T. Barnum” Whitacre, GM Chairman and CEO

Have you heard the rumor that General Motors is changing their slogan from “Mark of Excellence” to “There’s a sucker born every minute”?

Two weeks ago, I wrote a column about Ed Whitacre, the CEO and chairman of General Motors and his saturation TV commercials about how GM had repaid us taxpayers all of the money we loaned GM. If you missed that column, you can read it on my blog, www.EarlStewartOnCars. The bottom line is that Ed was “speaking with forked tongue” and GM did not do what he said. Taxpayers have not received one dime back from the TARP money our Congress voted to give GM. His whole claim was a “smoke and mirrors” effort to mislead the American taxpayer in an attempt to hype the value of GM stock when their IPO comes to market soon.

Following further along the lines of the famous huckster, PT Barnum, last week Ed fired his marketing manager who had been hired only a few months ago. Ed replaced her with the marketing manager from Hyundai. He chose this guy because of the way he had increased Hyundai’s sales during the recession. That seems like a good reason, but there’s more. He specifically chose the Hyundai marketing manager because of his advertising campaign claiming that Hyundai would allow a customer to stop making her car payments and return the car if she lost her job. I exposed this scam on my radio show. There are so many conditions in the fine print of this offer that virtually nobody can qualify. It’s “get ‘em in the door”, bait and switch advertising. Is this the kind of advertising we will be seeing from General Motors from now on?

Actually Ed “P.T. Barnum” Whitacre has already started with his bait and switch adverting. General Motors was exposed in last Monday’s (May 10, 2010) Wall Street Journal of being guilty of paying Consumers Digest to give their cars “Best Buy” ratings. Please don’t confuse Consumer’s Digest with Consumer Reports, an honest, accurate and non-profit organization. Of course, Consumers Digest is intended to be confused with Consumer Reports which has earned the trust of millions of car-buyers. Consumer’s Digest charges car manufacturers $35,000 for the first “Best Buy” rating and $25,000 for each subsequent one. General Motors paid for fifteen of their models to be rated a Consumers Digest “Best Buy”. That totals $350,000 to fool you and me into believing that GM makes good cars. Oh, I forgot to mention that Consumers Digest has no subscribers and sells no advertising! I guess we know how they make their money, don’t we?

I wrote an article for Hometown News about 3 years ago entitled “Consumer Reports is your best friend in choosing a car”. You can read that article on my blog by clicking on www.EarlStewartOnCars.com. In that article I warned car buyers not to be fooled by other publications that were “on the take” to give high quality ratings to car manufacturers. Consumer Reports is a non-profit and will not accept any payment from any product manufacturer. In fact, when they test a car, they buy the car from the manufacturer and will not even accept a car on loan. Furthermore, they do not allow any manufacturer to use their name in any advertising about the test results.

As most of my readers and listeners to my radio show know, I continually fight unfair and deceptive and illegal advertising by car dealers. Generally, I don’t have a problem with deceptive advertising by manufacturers. In fact, up until our government became the majority owner of General Motors, their advertising was basically OK. One of the big reasons Florida car dealers get away with so much is that our Attorney General, Bill McCollum, doesn’t enforce the “Unfair and Deceptive Trade Practices Act”. Florida car dealers may advertise any way they like, even illegally, without fear of reprisal. The Attorney General of the United States is Eric Holder, an Obama appointee. I can only speculate on why he hasn’t done anything about General Motors unfair and deceptive advertising. I’ll leave the speculation up to you.

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