The Crank: Changing Aveo to Sonic could cost GM up to $100 M

By John LeBlanc Two thousand and eleven is shaping up to be a big year for little cars. New car buyers will not only get a fresh Ford Fiesta, Mazda2, and Fiat 500 , Nissan Versa, and Hyundai Accent to choose from, debuting next week at the Detroit auto show, General Motors' Chevrolet will be showing off its long-awaited replacement for its Aveo subcompact, set to go on sale later next year. Trouble is, Chevy's new subcompact won’t be called Aveo. The rumours have ended up true. This week—and despite spending loads of money promoting the "new Aveo" concepts at auto shows around the world the past few years—GM has made a last minute decision before the car goes into production next March to rename its new subcompact hatch and sedan “Sonic.” Yes. As in the “hedgehog” and U.S. fast food chain. But more worrisome for a company that still owes Canadian and U.S taxpayers money, the decision could cost GM up to $100 million USD before one Sonic is sold. According to published reports, the name change came from GM North America President Mark Reuss. He objected to "Aveo" because it was hard to pronounce, and, well, “It’s just that there are a lot of other names out there.” Of course, that kind of logic would mean every car in GM's lineup would get a new name each year. But I digress... Whether more people will buy the small Chevy because it’s named Sonic instead of Aveo, who knows. But it will cost GM (and us!) a lot of marketing money. Jim Farley, Ford’s marketing head recently told TheDetroitBureau.com that a branding campaign to launch an all-new nameplate can cost from $50 million to $100 million USD more than a marketing effort designed around a brand name that’s already established. For example. Ford is launching a new 2011 Explorer right now, moving it to a crossover car-like unibody chassis after riding for a quarter-century on a body-on-frame truck-style SUV chassis. It’s about a big of a change in a vehicle you can make in the business. But after little success trying to get customers to understand what a Freestyle or Taurus X was, Ford is sticking with Explorer, thank you very much. As is Nissan with its new 2011 Quest minivan, or Hyundai with its new 2011 Elantra. But for some reason, GM knows something all these other automakers don’t. Plus, if you think how many times GM has played this name game in the past (Cavalier/Cobalt/Cruze; Sunbird/Sunfire/Pursuit/G5 Pursuit; Chevelle/Malibu/Lumina/Impala; Venture/Uplander; the list goes on) those $100 M hits really start to add up. What do you think? Should GM have stuck with the Aveo badge? As an Aveo owner, do you feel dissed that GM is ditching your nameplate? [Sources: TheDetroitBureau.com, Automotive News, Detroit Free Press]

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