General Motors Complaint - Cadillac Cost of ownership Prohibitive
GM has not yet understood that customer satisfaction is primarily determined by cost of ownership. That is, the purchase price plus repair cost over a reasonable lifetime. The cost of ownership of this Cadillac is substantially higher than the purchase price after only 60,000 miles of normal use. The blower unit went out after 21,000 miles. The plastic top of the dashboard separated from its glue and curled up after 40,000 miles. An electric window went out after 52,000 miles. Both left and right coils went out after 56,000 miles and a leaky water pump had to be replaced after 58,000 miles. The knee bolster under the steering column no longer stays on because all of the clip mounts that hold it in place have been broken by dealer mechanics.
It appears that GM has been caught up in "the sell the product at a loss and make money on the after sales parts" conundrum. Similar to selling ink jet printers below cost to make money selling expensive ink cartridges. When little or no money is made selling the car then the profit must come from selling parts at inflated prices. For example, when the cable that opens and closes the window breaks the entire window sub-assembly must be replaced at a cost of several hundred dollars. The cable that costs a few dollars cannot be replaced.
It is understood why sub-assemblies are replaced instead of individual parts because the number of parts required in inventory is significantly reduced. The problem is that reducing inventory cost by reducing parts with sub-assemblies is that the consumer pays much more for repair and the cost of ownership skyrockets. The service manager noted during the service review that they often service broken window cables so why does this problem persist? If a multi-hundred dollar sub-assembly must be replaced for a simple cable then shouldn't the cable problem be corrected? Or is it too profitable to sell an entire sub-assembly for a few hundred dollars caused by a broken cable that costs a few dollars? What happens to the sub-assembly that is replaced? Is it rebuilt with a new cable, returned to inventory and resold?
Another example is that the clip mounts used to hold on interior trim appears to be designed to break when the trim is removed. Each time a dealer mechanic removed the knee bolster for service they broke one or more clip mounts. Now there is only one clip barely holding the knee bolster on. The clips are not broken. The posts where the clips are mounted are broken. Because the posts are part of the knee bolster then the entire knee bolster must be replaced at a couple of hundred dollars because of a few broken plastic mounts. Wouldn't a little more plastic to make stronger mounts make more sense than having to replace an entire part after being removed 3 or 4 times? Or is it more profitable to sell the entire part for a couple of hundred dollars?
Relying on after sales parts and service for profitability is an indicator of a dying company. When a company cannot make profit from selling the product then surviving on after sales parts and service is only a temporary reprieve from failure. Eventually, the higher cost of owneship drives away customers so there is less product sold and less product to service. GM should stop selling inferior cars at a loss and relying on parts and service for profit and begin selling quality cars at a profit that require less service and lower the cost of ownerhip that increases the value of the car which in turn increases price and profitablility.