Government Leaves GM's Ad Budget Alone After Halving Chrysler's

(MoneyWatch)  Folks at Chrysler and its agency, BBDO, will likely be fizzing with anger at the news, reported in Ad Age, that General Motors' ad budget was passed by the Presidential Task Force on the Auto Industry without any changes. When Chrysler's bankruptcy went through that panel it was chopped in half.

GM now has permission to spend up to $50 million a month on ads during its restructuring while Chrysler's budget is just $67 million for the entire period. The companies are expected to spend three months before emerging, like butterflies, as viable businesses.

Car companies aren't made or broken by three-month advertising periods, of course, but the discrepancy will give more ammo to those who believe the government is meddling too much in this failed industry. It looks like the government has hobbled Chrysler at the starting gate, for no apparent reason other than a big ad budget following a bailout looks bad. GM, meanwhile, continues to burn through its bailout dollars on its "Reinvention" campaign -- an ad that doesn't advertise any cars! On the auto panel is Treasury Secretary Tim Geithner. He's a smart guy. I had lunch with him once when he was on the Federal Reserve Bank of New York. He knows an intimidating amount about macroeconomics. However, what he knows about auto advertising can probably be sketched on the back of a postcard.

If these companies are to emerge as legitimate, competing brands selling commercially viable products, then advertising decisions should probably be left to the executives whose bonuses depend on them, not Washington officials.

Image by Flickr user jorbasa, CC.