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The Hummer word derived from the military multipurpose vehicle soldiers call Humvee, which stands for High Mobility Multi Purpose Vehicle. This vehicle has been designed by AM General when they were the contract in 1979 by US Army to design a new vehicle for the Army to replace the old jeeps. a specialty vehicle manufacturer, Am general get the contract of designing a multi purpose vehicle from US Army. The big boxy Humvee designed by Am general was launched for field operation in the Gulf War in 1991.
Tv shots and media coverage of war made people familiar with the vehicle, In 1992 in response to the popularity and notoriety of Humvee launched a civilian version of it H1. it weighed 7100 pounds, had a 6. 5 litre V8 turbo diesel engine that produced 195 horsepower and propelled the vehicle to 60 miles in 18 seconds. However speed was never a point of difference for H1. rather it was designed to take serious elite road warriors of the beaten path. The vehicle could travel in very rough surfaces. The ad went “the world’s most serious 4*4”. It portrayed the vehicle’s offrorad capabilities and military heritage.
The target market was rich affluent people who could pay 100000 dollars to own the toughest vehicle. Am general also opened a Hummer driving Academy to train people how to drive it. GM market research GM found that most people associated Hummer name with the rugged and tough vehicle. In 1999 Gm made a contract with Am to buy the brand name and supply them with H2 sport vehicle for next seven years. H2, a smaller version would appeal to wealthy individuals, baby boomers who wanted to enjoy the life by facing challenges, and also to 30-40 individuals who were working in investment banks or so.
GM also hoped to launch H2 in luxury SUV market. Gm planned to sell 19000 H2 in 2002 and continue selling 40000 for the next years with a starting price of 49000 dollars. Softening the market Gm hired Modernista to develop 3 million dollar ad campaign, which started with tag line ” hummer, like nothing else” The ads went to different well known magazines to appeal to the segmented readers. The new ads rather than portraying how tough H2 is showed it in a journalistic type photography as it appealed more to the thought pattern of the target market. The launch
Gm targeted households of age 42 with income of 125000 dollars as opposed to AM’s 50 year olds with 200000 income. Differet luxury packages were offered with the H2. For promotion along with Tv ads, H2 were used in popular shows like CSI: Miami. On road test: Despite the criticisms that H2 lacked storage space and that only ten percent of the owner would actually take it off road H2 were roaring out of the showrooms. Gm was realizing 20000 profit from each sell. By mid 2003 demand slowed. After five months of straight declining sell due to rise in fuel prices Gm faced a declining customer satisfaction index.
However Gm was still determined to sell 100000 vehicles a year, so it launched a Sport utility version of H2. for mid 2005 Gm along with Nike unveiled the plan to launch a H3 SUV targeting the younger males especially the teenagers. GM demanded the 167 Hummer dealers to rebuild their showroom with driving ramps any other amenities to create a hype for smaller Hummer H3. However industry analysts think selling more hummers would dilute the brand’s image or even steal sales from other GM vehicles.