Should the new GM start with a new name?

[June 13, 2009]  WASHINGTON (AP) -- ValuJet was reborn as AirTran. Philip Morris rechristened itself Altria. Blackwater became Xe.

Would a name change work for beleaguered General Motors?

It would mean casting aside a brand that stood for almost a century as a symbol of American industrial might, but some marketing experts say it might be just the thing to help the once-mighty automaker make a fresh start.

"If the goal is to try and put this company on a massive diet and just turn it into a smaller car manufacturing operation, I'm not sure there'd be that much harm in rebranding," said Jean-Pierre Dube, a University of Chicago marketing professor.

"The brand isn't in good shape," he said, "so they have little to lose."

With GM tarnished by its bankruptcy and its reputation for building cars no one wants, wiseacres have had no trouble coming up with new names.

There's Groveling Motors, after GM's appetite for federal bailouts. And General Moneypit. And, perhaps most popular, Government Motors - after the taxpayers' major ownership stake.

With GM still righting itself, "it's just too soon" to think about a name change, company spokeswoman Susan Garontakos said. But she acknowledged the idea is part of discussions within the company.

"We know we want to reinvent the company and want to build it so that it's something that will show that GM is going to be the company of choice," she said.

In April, not long after taking the reins of GM from its ousted former leader, CEO Fritz Henderson was asked about the possibility and said it was "not something that's high on my list of things to do."

"Actually I haven't spent too much time worrying about the name of the company," he said. "We've only got so much time on our hands trying to get the brands right."

GM's misery has company among other big businesses that changed their names after tough times.

ValuJet, devastated when one of its planes crashed into the Florida Everglades in 1996, killing all 110 people aboard, took the name AirTran after buying that company's fleet a year later. It survives under that name today.

More recently, security firm Blackwater Worldwide, changed its name to Xe - pronounced like the letter Z - earlier this year to distance itself from its operations in Iraq, including a deadly 2007 shooting that killed several civilians.

Name changes often reflect how a company wants its business to be perceived. Philip Morris Cos. changed its name to Altria Group in 2003 because the company, which was also then the owner of food maker Kraft, wanted to shed its tobacco image.

But it's an effort not taken lightly. Experts warn that rebranding a corporate identity can take years and hundreds of millions of marketing dollars, drawing attention to how the automaker is spending money under government control.

And such a colossal effort still might not win over drivers, or investors.

Although the company may want to distance itself from its past, its past is not all negative. GM used to be known by other names over the years, including Generous Motors - a nod to the company's benefits package for workers and retirees.

Of course, that generosity helped push the company under. Ballooning labor costs made GM uncompetitive against foreign automakers like Toyota and Honda.

GM is already starting to rename parts of its business. Its investment-management arm, General Motors Asset Management, is now Promark Global Advisors. The banking arm of auto finance company GMAC Financial Services last month changed its name to Ally Bank.

And, on paper at least, the "new GM" - separated from the "old GM" in the Chapter 11 bankruptcy process - is already operating under a different name in court filings: Auto Acquisition Corp.

In the meantime, GM is plowing ahead with its reinvention campaign. A new television ad called "Chapter 1" promises a stronger and leaner company. GM is looking to shed its Saturn, Hummer, Pontiac and Saab brands.

Allowing the GM name to take the heat makes it a kind of shield for its individual brands, such as Chevrolet, GMC, Cadillac and Buick, that are more closely associated with individual cars, Mike DiGiovanni, GM's executive director of global market and industry analysis, said during a monthly sales conference call in April.

"What we're seeing is the GM brand gets dinged big time in terms of considering a GM vehicle," he said. "But when you look at Chevrolet, Cadillac and our other brands, they haven't changed."

If it did opt for a name change, GM could wait and pick a new name to highlight how its business is reshaping, said William Lozito, president of Strategic Name Development, a brand naming company based in Minneapolis.

That's what the electronics company known as Lucky Goldstar did in 1995 by changing its name to LG Electronics. The company kept the letters L and G but gave them new meaning - "Life's Good" - as it moved from making toasters to making televisions.

The Web site Automotive News offered other ideas in a poll - Chevy Inc., The Cadillac Motor Car Co., U.S. Motors and Renaissance Car Co., among others.

And then there's Lozito's suggestion for a name, with a nod to GM's small-car future: Great Mileage.

[Associated Press; By EMILY FREDRIX]

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