GM Exec Hopes Sales Better Than His Race Time

Why is legendary auto executive Bob Lutz so happy after placing seventh in a race he organized against journalists, bloggers and customers?

Because even though he didn't win, the winning car was the car of his choice. A former GM performance division executive who drove a Cadillac CTS-V claimed the top honors at Thursday's race at a Monticello, New York race track. The CTS-V, with a 6.2-liter, supercharged V-8 rated 556- horsepower engine, is the same model GM vehicle that Lutz drove in the competition.

In fact, seven of the top 10 cars on the track were Cadillac CTS-Vs. Of course some of the CTS-V's direct competitors in the U.S. market like Jaguar, BMW and Mercedes Benz opted out of the competition, but it was still a pretty good marketing plug for General Motors' luxury brand.

Hoping to build on an aggressive two months of marketing, struggling U.S. auto maker General Motors announced Thursday that it is extending its money-back guarantee program, which is part of the company's "May the Best Car Win" campaign. The program, which offers unsatisfied customers a refund within 31 to 60 days of purchase, was scheduled to end Nov. 30. Instead, GM is extending the offer until Jan. 4, 2010. And Lutz couldn't be happier with the campaign's early results.

"It's working and it's costing us nothing," Lutz told ABC News shortly after the race. "It's having a very very favorable effect on customer's consideration. It's a very strong statement of the confidence that we're having on our products."

General Motors, which launched the campaign as its first major marketing effort after emerging from bankruptcy, says it has sold 142,000 cars under the special offer. So far, 15 cars have been returned with another 49 cars in the process of being returned.

"When you look at the composition of the 15 cars almost all of them are customer error," Lutz says. "They bought a Camero and then figured, 'oh hell, this isn't what I needed,' and they bring it back and get something with four doors. We had the case where a guy wanted a manual-transmission Corvette, and he had a difficult commute, and it took him about two weeks to figure out he really should have bought an automatic transmission. So he brought it back and we swamped it out for him," he said.

The automaker, which has received $50 billion in taxpayer loans, is hoping to reverse its fortunes and stem the slide of its sales and market share in the United States. It will try to boost sales with a second round of advertisements in December featuring hood-to-hood comparisons with competitors. The ads will emphasize the attributes of GM cars versus the competition. "We're going to eliminate this perception gap between what people think GM vehicles are like and what they are naturally like," said Lutz.

There are signs that GM's marketing campaign is making a difference. CNW Research, an automotive marketing research firm, has said the "Best Car" program has been successful by spiking interest in GM products far beyond any recent previous efforts. Also, Edmunds.com forecasts a strong October for General Motors, saying the company will achieve its highest market share year to year at 21. 5 percent, up from 20.9 percent in September. Earlier this year, GM's market share had dropped to a record low 19 percent.

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